Philippine National Bank on Wednesday launched a loan program on Guam that will help Filipinos and foreigners buy homes in the Philippines.
The program, called Own-A-Philippine-Home Loan, launched the same day Guam-based Filipinos celebrated the 121st Philippine Independence Day.
PNB also has rolled out or is launching the program in Los Angeles and New York.
The program's Guam launch was specifically timed with the 121st celebration of the Philippine Independence Day, PNB Guam's General Manager Mario Palisoc said, "as our way of giving the Guam community a convenient avenue to finance their property investments in the Philippines using PNB Guam."
"We project to handle at least $1 million a year in the next five years – depending on the continued growth of the Philippine real estate sector during the period and its attraction to overseas Filipinos and foreign investors, notably in Guam," Palisoc said.
From the time of submission of the application and other required documents to loan booking, it takes about 30 banking days, Palisoc said.
He said PNB is also working on partnering with a Guam bank but the partnership awaits regulatory approvals on Guam and in Manila.
Here are some details provided by Palisoc:
• Who can apply? Any Guam resident with gainful and stable employment or business income may apply. The program does not require U.S.-Philippine dual citizenship. Foreigners will be limited to the purchase of condominium units, rather than standalone homes, in accordance with Philippine laws.
• What is the maximum loan amount? $500,000.
• What are the terms? Current term offerings are five, 10, or 15 years with a fixed interested rate but subject to re-pricing after five years.
• Does the program allow construction loans too, if the land is already under the borrower's name? Yes.
• How much will the bank finance? The loan will cover up to 80% of the property's value. The borrower has to raise the 20% down payment.
• How does credit verification work? The program uses the credit scoring system of U.S.-based Experian.
• What is the minimum debt-to-income ratio? The debt-to-income ratio must be below 40%.
• What is the required length of employment? A minimum of two years.
• Does the program include the refinancing of existing home loans from other financial institutions? Yes.