As we get older, we want to have our own house and lot to secure our family's future. Planning a housing loan is not an easy-peasy thing; there are many things to consider knowing that it involves money. Investing in properties has a lot of good reasons to pursue. In the first instance, the value of the property is more likely to increase than to depreciate. Second, the property can be considered an asset to increase its value and provide stable and secured investment.

Furthermore, it is a necessity. The demand for a nice and comfortable home is on the rise. Everyone needs a secure and safe place to live.

Mortgage

Obtaining a mortgage is a necessary step that you must take in purchasing a first home, and there are numerous factors to consider when choosing the ideal one. While the abundance of financing choices available to first-time homebuyers may appear overwhelming, researching the fundamentals of property financing can save two major things: time and money. Understanding the market in which the property is located and whether it offers financial advantages to lenders may result in additional financial benefits for you. You may also ensure that you acquire the mortgage that best suits your needs by taking a thorough look at your finances.

Credit History

Lenders will assess or check your creditworthiness and ability to repay based on your income, assets, credit history, and debts. Please take note that your credit history is a factor that may greatly affect your housing loan eligibility. This serves as a track record of your manner of being responsible in terms of repayment of debts. The credit history is created through collating data from various sources like government agencies, banks, collection agencies, and credit cards.

If you don't yet have a credit history, you can start one by getting a credit card from the same bank where you plan to borrow money. You can then use the card on a regular basis and pay your bills on time. As you establish a good credit history, you will be able to demonstrate that you have a steady source of income, understand how to be responsible with your bills, and can pay your bills on time. But the question is, what financing option is the best choice?

Lumina Homes provides different financing options to choose from. Firstly, Pag-IBIG Housing Loan. Pag-IBIG Housing Loan allows borrowing up to 6million under very low rates and, at the friendliest term, to help us fulfill our dream of owning a home. This is open for employees either for private or government, self-employed, and OFWs up to the age of 65 years old. The company will refer to the maximum length of term for your housing loan based on your age.

To set an example, if you're already 50 years old, you are not qualified to get a 30-year Pag-IBIG housing loan because this term requires that you complete paying the mortgage before turning 65 years old. However, you may also choose the 15-year or 10-year, or 5-year term, to fit the required age. Also, if you are married and would like to apply for a home loan with your spouse, their income will also be evaluated. The company can also base your ability to pay off a loan on the number of dependents.

Applying for a Home Loan

When applying for a home loan, you must generally have been employed for at least two years. If you own a business or fall into the self-employed category, you may still be approved for a home loan. You may be required to provide additional information about your taxes, profits, and income, as well as business permits and other relevant documents.

Pag-IBIG Housing Loan

The maximum amortization term is up to 30 years and a minimum of 5 years, depending on how many years a client can be qualified. Applying for a Pag-IBIG Housing loan in Lumina requires at least two years of membership and an updated contribution. This financing option offers the lowest interest rate so that we can have a budget-friendly monthly payment.

Bank Housing Loan 

Next, Bank Housing Loan. Bank offers loans up to 90% of the total contract price. They require the client to qualify on the minimum monthly income that the developer sets on the specific unit. The maximum amortization term a Bank loan offers is up to 20 years, a minimum of 5 years on a lower interest rate.

In-house Financing

Last and foremost, in-house financing. This financing option benefits clients to obtain a loan through the developer where they may not be able to through traditional financings, such as Pag-IBIG and Bank. The interest rate of in-house financing is generally higher and offers a shorter amortization term resulting in a bigger monthly payment. But the good thing is that it is less stringent regarding requirements and the approval process.

Looking back on the three financing options, Pag-IBIG Housing loan is a wise choice because of its lowest interest rate offered with a maximum term of 30 years. It indeed gives us an affordable monthly payment for our dream home.

Monthly payments on a variable interest rate mortgage will vary. Throughout the term of your loan, the interest rate fluctuated with the market. Typically, the interest rate you must pay will be lower than the market rate and may gradually rise.

Your loan term depends on your eligibility. Pag-IBIG Fund usually offers a maximum term of 30 years to pay off your housing loan while 25 years for the bank. On the other hand, the in-house financing period of payment can be as short as five years.

If you're looking for a home and will use a housing loan for the first time, you may find it extra challenging to sort through all the financing options. It is best to decide how much home you can afford and then finance accordingly.

Getting a housing loan can surely help you achieve your goal of owning a property that you can truly own. It may also help turn your humble abode into a comfy paradise since it offers easy-on-the-pocket payment terms.

However, you should think twice about having a mortgage before you do. Analyze your budget to see if you can afford the monthly installments before signing up for anything. Find the best mortgage and lender by comparing available loan options. Discuss it with your spouse so that you may align the family's budget as well. Obtaining a home loan is a long and difficult procedure, but it's well worth it in the end.