CAN EXPATS APPLY FOR A HOME LOAN FROM A LOCAL BANK?
I have had a couple of inquiries from expatriate clients who are not married to a Filipino regarding the possibility of getting a loan from a local bank to finance their home purchase here in the Philippines. So is the option of borrowing from a local bank possible for them? The answer to this question would vary depending on which bank you are talking to.
To shed light to this concern, I met with a couple of bank officers and here is what I was able to get from them:
While it may seem quite straightforward, the more stringent part of the loan application process would be to prove that the expat applicant will be staying here for good and that their purchase will be used as their permanent residence in the Philippines and of course, their capacity to pay off their loan.
We also have to keep in mind that they are only allowed to apply for a loan for the purchase of a property that is covered by a Condominium Certificate of Title for obvious reasons. Also, it is very crucial to know if your expat client is purchasing the property for his or her permanent home or as an investment.
Now, although a guarantor or co-borrower is not required by most of the banks that I have interviewed, I ascertain that this would still depend on the result of the applicant’s credit assessment that will be conducted by the bank.
As for the loan per se, bank’s would usually offer a maximum loan payment term of 10 years with an interest rate similar to what they would give to a local borrower.