Buying real estate is a very good form of investment. Whether it’s a dream house for you and your family or for an income generating opportunity such as boarding houses, apartments for rent, and office spaces.
So let’s assume that you have found the perfect property and now thinking about the steps on how to get hold of it. How are you going to pay for it? If you have the money, then paying in cold cash is the easiest way to go. Spot cash payment is ideal and the idea is pretty simple.
Spot Cash Payment
If you want the easiest and fastest way in buying real estate in Davao or any part of the Philippines in general then paying in spot cash is for you. Spot cash payment, as the name suggests, simply means the buyer pays the price of the property in a short period of time which is usually one month after the date of reservation.
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Example: House and Lot Package at Ilumina Estates Subdivision
Ilumina Estates is a high-end subdivision project in Communal, Buhangin, Davao City
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Ilumina Estates House and Lot Package
Lot area: 204 sqm Spot Cash Payment Price: Php6,482,010.60 (discounted) |
However, not many people can afford paying in cold cash. Most of us would choose paying in longer terms in buying a property. It’s a very important decision to make and hence Davao Property Finder advices you to analyze your budget and state of finances first before making any decisions. Learn the advantages and disadvantages of the following financing options. What financing options do you have in buying a property and which one suits you best? Below is a description of the available financing options a buyer has in purchasing real estate in the Philippines.
- What is Pag-ibig Financing?
- What is In-House Financing?
- What is Bank Financing?
- What does Deferred Cash Payment mean?
Pag-IBIG financing is the most popular among Filipinos because of the longer terms and lower interest rates. In this financing option, the buyer pays the equity first. Then, the balance will be financed through Pag-IBIG. Payment can be up to 30 years.
Note:
Total price – Loanable amount = equity
In some subdivision developments, Pag-IBIG financing is not allowed.
Learn more by visiting our Pag-IBIG financing page.
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Example: Gabriella House and Lot Package at Elenita Heights Subdivision in Catalunan Grande, Davao City
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In-house financing means the buyer pays directly to the developer. In Davao City, the total price is usually divided into 1) 20% down payment; and 2) 80% loanable amount. The buyer may choose to pay the down payment in spot cash (with special discount) or in monthly installments (usually up to 6 months, without discounts). After paying the down payment, the balance of 80% will be paid monthly for a given period of time (usually up to 5 years to pay)
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After paying the down payment, the buyer loans the balance of the property from a bank. This simply means that the bank pays the developer/owner of the real estate property and the buyer pays the bank. The property will be under the bank’s name as collateral just so the bank can go after the property in case of nonpayment.
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Example: House and Lot package at La Vista Monte, a middle class to high end subdivision in Davao City
Deferred cash payment means the total price of a real estate property will be divided equally in a given period of time (e.g. 3 years). If you see the following phrases: “No down payment required; No interest” then it uses the deferred cash method.
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Davao Subdivisions | Davao Condominiums | Real Estate in Davao
