FINANCING; Philippine Loan, Mortgage

Payment Possibilities (evaluated on a case-to-case basis):

1) For most Philippine houses expect to pay 30% to 50% of the contract-amount at contract signing.
The rest by 'progress billing' which means you pay every month as long as the construction is going on (about 5 months).
It is wise to buy ALL building materials at the start of construction; not every month little-by-little because prices will not likely go down PLUS you get a nice discount at the hardware store for buying in bulk.

2) (only if you have a titled lot) pay 50% of the contract-amount at contract signing; minimum Php 1M
The rest as loan over a period of maximum 5 years with approx. 1% interest per month.

3) (only if you have a titled lot) if you have a good business-plan to build apartments, subdivision or hotel etc. we provide 100% development loans (up to US$ 1 Billion) and all building materials free of charge based on the fact that you would sign a Joint Venture & Commercial Land Lease Agreement with us.

  between the lender and the borrower Philippine housing loan

The borrower initially receives an amount of money from the lender, which they pay back, usually but not always in regular installments, to the lender. This service is Philippines mortgage home loan generally provided at a cost, referred to as interest on the debt. A borrower may be subject to certain restrictions known as loan covenants under the terms of the loan.
 

Philippines home loan

Acting as a provider of loans is one of the principal tasks for financial institutions. For other institutions, issuing of debt contracts such as bonds is a typical source of funding. Bank loans and credit are one way to increase the money supply.

Legally, a loan is a contractual promise of a debtor to repay a sum of money in exchange for the promise of a creditor to give another sum of money.

Contents [hide]
1 Types of loans
1.1 Secured
1.2 Unsecured
2 Abuses in lending
3 United States taxes
4 Income from discharge of indebtedness
5 See also
6 References



[edit] Types of loans Philippine loans

[edit] Secured
A secured loan is a loan in which the borrower pledges some asset (e.g. a car or property) as collateral for the loan.

A mortgage loan is a very common type of debt instrument, home loans Philippines used by many individuals to purchase housing. In this arrangement, the money is used to purchase the property. The financial institution, however, is given security - a lien on the title to the house - until the mortgage is paid off in full. If the borrower defaults on the loan, the bank would have the legal right to repossess the house and sell it, to recover sums owing to it.

In some instances, a loan taken out to purchase a new or used car may be secured by the car, in much the same way as a mortgage is secured by housing. The duration of the loan period is considerably shorter - often corresponding to the useful life of the car. There are two types of auto loans, direct and indirect. A direct auto loan is where a bank gives the loan directly to a consumer. An indirect auto loan is where a car dealership acts as an intermediary between the bank or financial institution and the consumer.

A type of loan housing loan in the Philippines 

especially used in limited partnership agreements is the recourse note.

A stock hedge loan is a special type of securities lending whereby the stock of a borrower is hedged by the lender against loss, using options or other hedging strategies to reduce lender risk.[citation needed]


[edit] Unsecured
Unsecured loans are monetary loans that are not secured against the borrowers assets. These may be available from financial institutions under many different guises or marketing packages:

credit card debt,
personal loans,
bank overdrafts
credit facilities or lines of credit
corporate bonds
The interest rates applicable to these different forms may vary depending on the lender, the borrower. These may or may not be regulated by law. In the United Kingdom, when applied to individuals, these may come under the Consumer Credit Act 1974.

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[edit] Abuses in lending
Predatory lending is one form of abuse in the granting of loans. It usually involves granting a loan in order to put the borrower in a position that one can gain advantage over him or her. Where the moneylender is not authorised, it could be considered a loan shark.

Usury is a different form of abuse, where the lender charges excessive interest. In different time periods and cultures the acceptable interest rate has varied, from no interest at all to unlimited interest rates. Credit card companies in some countries have been accused by consumer organisations of lending at usurious interest rates and making money out of frivolous "extra charges" [1]

Abuses can also take place in the form of the customer abusing the lender by not repaying the loan or with an intent to defraud the lender.


foreigner right to have a bank loan in philippines


[edit] United States taxes
Most of the basic rules governing how loans are handled for tax purposes in the United States are uncodified by both Congress (the Internal Revenue Code) and the Treasury Department (Treasury Regulations – another set of rules that interpret the Internal Revenue Code).[2] Yet such rules are universally accepted.[3]

1. A loan is not gross income to the borrower.[4] Since the borrower has the obligation to repay the loan, the borrower has no accession to wealth.[5]

2. The lender may not deduct the amount of the loan.[6] The rationale here is that one asset (the cash) has been converted into a different asset (a promise of repayment).[7] Deductions are not typically available when an outlay serves to create a new or different asset.[8]
Pagibig housing loan Philippines

3. The amount paid to satisfy the loan obligation is not deductible by the borrower.[9]

4. Repayment of the loan is not gross income to the lender.[10] In effect, the promise of repayment is converted back to cash, with no accession to wealth by the lender.[11]

5. Interest paid to the lender is included in the lender’s gross income.[12] Interest paid represents compensation for the use of the lender’s money or property and thus represents profit or an accession to wealth to the lender.[13] Interest income can be attributed to lenders even if the lender doesn’t charge a minimum amount of interest.[14]

6. Interest paid to the lender may be deductible by the borrower.[15] In general, interest paid in connection with the borrower’s business activity is deductible, while interest paid on personal loans are not deductible.[16] The major exception here is interest paid on a home mortgage.[17]