While buying a property in the Philippines remains to be a momentous financial undertaking for most of us, the good news is there are many real estate investment options scattered on prime locations in the country. Some of these locations are Makati, Parañaque and Taguig specifically Bonifacio Global City.
Jumping into the property-buying process, however, must not be done in a haze. Educate yourself first. Here are the necessary steps in buying a property.
What is the purpose of buying? For family use, retirement, business or investment? Put simply, it is for residential or commercial use?
Next, what is your desired property category? House and lot, lot only or condominium unit(s)?
What is your desired location? In the metro or nearby provinces? Far from the busy-ness of the city or near your place of work?
What is your budget? For this, you need to set prices minimum and maximum. For example, your budget is between Php2 and Php7 million.
Finally, what are your other specifications? For a residential house or condo unit, how many bedroom and garage provisions would you like? Would you prefer combinable condo units?
These are the information you need in finding the right property for you regardless of its purpose. Also, once you determined all these, it is easier to narrow down your choices.
This is where property portals and real estate websites will come handy. The process is easier if you have a developer in mind and simply type in its name on the search bar. Then, you can simply find the properties you like and compare. Comparison shopping is a weapon in making informed buying decisions.
After seeing the properties on the Internet, your next goal should be inspecting your shortlisted properties. Nevertheless, you don’t want to tour the properties alone.
Typically, developers have a roster of licensed brokers to sell the properties on its behalf. Some property buyers think that buying a property straight from the developer is the best route to take. Not so fast. Unless you are proficient at the process, then by all means, do so. However, if you have no idea whatsoever about the processes, fees and charges involved, among others, then buy through a broker.
There are many ways by which a broker can be beneficial for you.
First, a broker facilitates the entire process from scheduling appointments to securing legal documents.
Second, which is a continuation of the second step, a broker accompanies the buyer to the sites of the shortlisted properties. He or she can also recommend other properties based on your criteria or if you haven’t already shortlisted your desired properties. The broker can also search for more properties that suits your criteria.
Third, a broker negotiates specific fees and charges in behalf of the buyer.
Notably, some developers treat brokers as an extension of their marketing departments. With or without a broker, the contract price will be the same. So, you might as well buy a home through the broker.
Pay the reservation fee only if you are comfortable with the computation. Make sure that the computation reflects accurate information. It should include the total contract price, down payment, [less] reservation, net down payment, monthly deposit and loanable amount. There should be a breakdown of monthly amortization, depending on the total tenure of the housing loan.
Further, some computations include legal, transfer and miscellaneous fees while some don’t. If an item is not clear to you, ask your broker. He or she can shed light on what the specific items entail particularly interest rate.
If everything’s cleared up to you, you can now pay the reservation fee. Most developers require a reservation fee that is deductible either from the down payment or total contract price. Paying the reservation fee gives you more time in deciding which payment scheme to choose (bank, in-house or Pag-IBIG) or while completing the requirements.
A Reservation Agreement may be issued if the buyer needs more time in analyzing the property and payment schemes available to him or her.
You might want to ask about down payment. You can pay for it in-cash or every month until you complete the required amount. Developers usually require up to 20% down payment (which means it can be 5, 10 or 15%) payable up to 24 months (which also means it can be 6, 12 or 18 months).
You might be securing specific requirements, but at this point, all the requirements must be turned in.
The requirements will depend on your chosen payment scheme. Nevertheless, developers, banks and even Pag-IBIG have minimum document requirements. These may include accomplished home loan application form, photocopy of government-issued IDs, community tax certificate, TIN (tax identification number), recent ITR (income tax return), certificate of employment and latest three months pay slips.
Take note that there are eligibility requirements as well, and these differ from one financial institution to another. For instance, you must be 25 years upon loan application and must not exceed 65 years upon loan maturity.
Alternatively, you may get yourself pre-qualified first by your bank before you start hunting for the right property. Through this, you would know your qualifying limits as well as your capacity to pay.
Through your broker, submit all the requirement to your chosen facility. Read the fine print first before signing any document. Then, collect the important documents as proof of ownership. These are the Contract to Sell, Deed of
Absolute Sale and Certificate of Title or Condominium Certificate of Title.
A word of caution: Ensure that the title is authentic. Certificate of titles are issued in duplicates – the original copy will be handed to the owner while another copy will be submitted to the Register of Deeds (ROD).
At this point, taxes and clearance fees must be paid before the Title Certificate is issued by a court. The amount of transfer tax depends on the location of the property, but it is typically .5%.
Evidently, buying a property can be a lengthy process. With prudence and of course, the help of the right people though, it can be made easier.