Should You Buy a Brand-New or Pre-Owned Home?

One of the things OFWs would want to buy is a house. After all, who doesn’t want to have a place they could call their own, right?

Here’s the next question: what type of house should you buy? Should you go for a brand-new house or pre-owned?

The truth is you can buy any. Before you do, you need to know the pros and cons of buying brand new or a pre-owned house to help you decide better.

Let’s Go for a Brand-New House

When we say brand new house, we mean houses or condominium units built by real estate developers. It’s a different case if you simply bought a property and have someone construct your dream home.

Below are the pros of buying a brand-new house:

  • The design of the house is modern and contemporary since it was built according to the latest trends.
  • You don’t need to worry about repairs since the house was newly-constructed. In fact, everything is new.
  • Minimal changes can be done, which you must address during the construction phase. Nonetheless, this is applicable if you will be buying a house constructed by a real estate company.
  • You can easily design and personalize the house according to your own preferences.

On the other hand, here are the downside of buying brand new:

  • The selling price is higher. Real estate tends to increase in value, so you need to consider the selling price first before you say yes.
  • If you will be buying in a subdivision, then the house will look the same as the rest. Still, you could make minor changes outside that will set your house apart from the rest.
  • Room for price negotiation is limited.
  • The space and interior of the house may be limited since developers follow a specific layout.

That being said, you still need to check on the legitimacy and trustworthiness of the developer. Inspection is also a must, so make sure you schedule an ocular visit to get to feel the neighborhood.

Pre-Owned Home is the Way to Go

Let’s say you decided to go for a pre-owned house. That’s fine.

Here are the good things about buying this type of house:

  • Price is lower compared to brand-new houses. Some are even willing to sell it market value just to sell the property.
  • Speaking of prices, there is more room for negotiation. This is why house inspection is important so that you could see the condition of the house and negotiate according to the present condition.
  • There are more options that could suit your preferences. In fact, you could see houses that hit all of the requirements in your checklist.

Consequently, there are downsides to buying a pre-owned house. This includes:

  • You need to consider repairs and/or renovation. Pre-owned house means someone lived there. You have to check every tiny detail and make repairs to make sure that the house is liveable. Make sure you address leaks and pests since this could compromise the integrity of the house. You might even be tempted to change locks, overhaul certain parts of the house, and do re-painting jobs.
  • There is semblance of the past. The pre-owned house was built years ago, which means there are portions of the house that reflect the trends from the past. If this doesn’t suit you, then you might want to include this in your renovation plans.
  • Whether you like it or not, someone lived in that house. You might not be comfortable with that idea, which means getting a brand-new house is more suitable for you.

Should you decide to buy a second-hand home, make sure you make thorough inspection. It’s hard to back out once you decide to say yes to a particular house.

Get to Know Your Obligations as a Homeowner

Congratulations. Finally, you have a place you can call your home. It’s not easy because you and your family have to give up several balikbayan boxes and travel plans for years to make sure that you can buy a place of your own. At least now, you can come home to a place that belongs to you and you don’t have to worry about where to live come retirement.

Apparently, owning a home comes with responsibilities – sometimes, a costly one. In fact, paying for the house is just a small chunk of being a homeowner. There are tons of responsibilities and obligations that come with it, which you need to prepare for.

Here are your obligations you need to prepare for as a homeowner:

Payment of Association Dues

This is applicable if you bought a condominium unit or a property inside a village with an existing homeowner’s association.

Association dues or monthly dues are fees collected by the homeowner’s association from its members. The amount usually depends on the size of the property, although some associations agree on a uniform and reasonable amount.

Payment of association dues allows you to enjoy benefits within the community such as the use of common areas and facilities and provision for security among others. In case of default, you may not be allowed to enjoy these benefits.

Monthly Amortizations

Just like majority of Filipinos, you decided to get a housing loan to finance the purchase of your dream home. You can apply for one from banks, government institutions like PAG-IBIG, or private lenders.

When you get a housing loan, this means every month, you will pay principal and interest amount for x number of years.

You need to prepare for this. Failure to pay your monthly amortization may lead to foreclosure of your property. This means the house you paid for might be taken away from you and you surely don’t want that to happen.

Before you decide to buy a house, make sure you have sufficient funds to cover for the amortization. This way, even if you are no longer working overseas, you could still pay your loan.

Real Property Tax

According to the Local Government Code, the local government unit may impose yearly fee on all types of real estate. This fee is a certain percentage of the property’s assessed value, which means the bigger the property, the higher the real property tax or RPT will be.

Each municipality has its own policies on the collection of RPT. The Quezon City government gives 20 percent discount until March 31 of every year for early payment of RPT. Some cities allow discount up to January 31 only.

Regardless, you can pay RPT in full or every quarter. It is best that you pay for the entire year so you don’t have to worry about taxes for the rest of the year. You can not only enjoy discount but also lessen the risk of being a delinquent taxpayer.

Don’t underestimate non-payment of real property tax since you could potentially lose your home.

Regular Maintenance

Apart from your financial obligations, you are also expected to perform certain tasks as a homeowner.

Just like any other things you own, wear and tear could be an issue that you need to address as soon as possible. There will be leaks in the roof, broken doors or cabinets, pipe issues, and the list goes on.

Always make sure you set aside a portion of your income to cover for these maintenance expenses. You need to prioritize this, otherwise, you could compromise the integrity of your home, which you don’t want to happen.

Being a homeowner is about responsibility. Take note of these obligations and surely, your home will reward you with safety, security, comfort, and peace of mind.

6 Tips Nobody Tells You when Buying a Second-Hand Home

In a previous post, we talked about tips on how to buy foreclosed properties. After all, this could be a feasible option since this is generally cheaper than buying a brand-new property.

What about second-hand or previously-owned home?

This could be a good option as well. Pre-owned house is also more affordable. In fact, you can get a pre-owned three-bedroom house in the same area at a cheaper price compared to similar brand new unit.

Don’t get excited yet. There are several factors you need to look into before you buy a previously-owned house.

Check out these tips as your guide before you say yes to a certain property:

Tip No. 1: Know where to look.

Fortunately for you, finding a property to buy is easier even if you are miles away from home. There are dedicated websites that allow you to browse various property listings in and out of Metro Manila. You can also join groups on Facebook where people regularly post properties for sale.

Take advantage of these online platforms. The good news is you can even ask details about their listing, thereby making it easier for you to make a shortlist of prospective properties.

Tip No. 2: Location is key.

When it comes to buying a house, whether or not it is brand-new or pre-owned, location is very important. You want a house that is accessible to school, malls, supermarket, church, and hospital. You also want to live in a place where you don’t have to worry during rainy season. Surely, you don’t want to your family to live in a house where the surrounding environment has high crime rate.

In other words, don’t compromise the location in exchange of cheaper price. Safety and comfort should be among your priorities, so make sure you choose a location that could provide you with these.

Another reason why location is important is because of the market value of the property. Make sure that the house you plan to buy is within the range.

Tip No. 3: Make sure you inspect the property.

Pictures can be deceiving. Before you say yes to a property, especially for a pre-owned house, you need to see its condition first.

Inspection is crucial because you need to check not just the overall structure of the house but also every corner of it. The house will potentially be your home, which means you need to see its present condition including but not limited to:

  • Structural integrity
  • Electrical system
  • Plumbing
  • Cracks and leaks
  • Roof, floor, and walls

Take these into account since the costs you might pay to make the house functional again may be equivalent to buying a brand-new unit. This could be a deal-breaker, so make sure you schedule that inspection.

Tip No. 4: Check the documents.

Aside from inspecting the property, you need to inspect the documents as well.

Are you buying the property from the owner as seen in the title? Are the real estate taxes paid and up to date? Is the owner selling the correct amount of land based on the title?

You need to make sure that the sale is legitimate, which is why checking the documents is a must.

Tip No. 5: Know your budget.

You found the perfect home for your family. You contacted the owner, had several exchanges online, and scheduled property viewing on your upcoming vacation.

As it turns out, the property you plan to buy is way out of your budget.

Before you go through the process of communication and inspection, you need to establish first how much you are willing to pay for your family home. Luckily, pre-owned houses are relatively cheaper than brand-new units, but still, it should be within your range.

What about financing? That is possible, but take note that lenders can only extend up to 60 or 70 percent of the purchase price. The balance will be shouldered by you, which means you need to withdraw money from your savings account to be able to buy that house.

Since you are buying a pre-owned property, consider the costs of repairs as well. You might have budget for your home but can your pocket handle thousands of pesos more for repairs?

Tip No. 6: Ask the neighborhood.

Sellers will always have their best foot forward. They want to sell the property so naturally, they will say only the best things.

If you’re unsure, then don’t be afraid the ask the neighborhood to verify. There may be incidents in the past that could be red flag for you, so make sure you ask.

5 Things to Remember when Buying a Foreclosed Property

Where do you plan to use your hard-earned money from working overseas? Surely, you would want to have sufficient savings for the rainy days, set aside money for your kids’ tuition fee, pay off existing debts, and buy a place you could call your home.

Yes, your home.

Apparently, buying a house, regardless of its type, requires money – big amount of money. Because of this, you might hear some people say you consider buying foreclosed property since it is cheaper and easier on the wallet.

Don’t get too excited. Here are several things you need to remember before you say to a foreclosed property:

Tip No. 1: Location, location, location.

This is one, if not the most important consideration when buying a property in general. Ideally, your future home must be near establishments like school, hospital, malls, or grocery stores. You also need to check whether or not the property is located in the fault line or in flood-prone area.

Don’t forget to check the surroundings because you surely don’t want to live near slaughterhouses, squatters, or garbage dump. Ask about the crime rate incidence because safety of your family is something you need to consider as well.

Tip No. 2: Check the current condition of the property.

You are looking for a place that you could potentially call your home. This is why it is imperative that you inspect the house before you pay. After all, foreclosed properties are often sold in “as is, where is” basis, which means expect that the house is not in tiptop condition.

Wear and tear is normal, especially when the house has been existing for years. If you see that the property needs extensive repairs because you saw cracks on the walls, termite infestation, or rotting wood among many others, then you might want to reconsider your choice. In fact, questionable structural integrity could be a red flag.

Paint job or changing the door knobs is fine, but if you need to shell a big amount for the repairs due to structural flaw, then the property may not be worth it.

Tip No. 3: Know the costs involved.

Buying a foreclosed property doesn’t end with paying the selling price. In fact, there are many other costs you need to pay for such as:

  • Capital Gains Tax, although this is usually shouldered by the seller
  • Documentary Stamp Tax
  • Transfer Tax
  • Real Property Tax
  • Association dues if the property is a condominium or a part of homeowner’s association
  • Repairs to be done on the property

In other words, you need to factor in these costs plus any other additional costs to check whether or not you are getting a good deal. This should be considered because you might be surprised to find out that buying a brand-new property is cheaper.

Tip No. 4: Establish your budget.

How much are you willing to pay for your dream home?

The price of your choice of property is dependent on its location. This means if you are eyeing for a house in Quezon City, then you need to prepare a big amount. If you are willing to spend up to P3 million only, then you need to look outside Quezon City where properties are more affordable.

What if you don’t have enough cash on hand? Then you might consider financing. Banks and private lenders offer financing options to help you buy your home at affordable interest rate.

Take note that even though financing is available, you still need to cash out a certain percentage of the selling price. Having a cash on hand is also important especially when you buy foreclosed properties during auctions.

Tip No. 5: Work with banks or accredited broker.

Scammers or people with bad intentions often look for people who could easily fall into their trap. Oftentimes, they take advantage of OFWs because you are easier to convince.

Well, don’t be a victim. When it comes to buying foreclosed properties, it is best to work with banks or accredited real estate brokers. They will help you every step of the way and guide you to ensure that the sale is as smooth-sailing as possible.

You wouldn’t want to end up with a problematic property, do you?

5 Financial Emergencies Every Family Should Be Ready For

If worries are equivalent to money, then surely, many Filipinos are millionaires these days. Unfortunately, worry does not equate to growing your money. In fact, worry does involve money, which means you need to prepare for these concerns before it even happens. Otherwise, you might end up in debt and lose what you have just because you didn’t prepare early.

This is not just a Pinoy problem. In fact, this is a global problem. Every family, regardless of the race, should be concerned.

Before it’s too late, here are the most common financial emergencies you and your family should prepare for:

Emergency No. 1: Natural Disasters

Apparently, the Philippines experience more than 10 typhoons every year. For the past few years, the PHIVOLCS is warning the Filipinos about the impending earthquake or “The Big One.”

In other words, natural calamities will always happen. These calamities could lead to destruction, which eventually leads to loss.

Nothing beats early preparation when it comes to natural disasters. Having an Emergency Bag with food, water, and basic supplies could separate life and death in case disaster happens. Having an Emergency Fund is also helpful since your family could use it to get started. Getting an insurance coverage for your car and home could also help, although this could mean additional expense.

Emergency No. 2: Job Loss

OFW life is unpredictable. You’ll never know when disaster or political turmoil will struck the country where you’re working. There is also a possibility that you might be sent home due to variety of reasons such as redundancy, bankruptcy, and even co-workers stabbing your back.

This is why we always stress how important savings and investment are while you are still working overseas. You earn more, which means there is a higher chance that you could save more. Make the most out of your time there by working hard. If your health and body permits, get another side job or put up a small business back home for your backup.

Emergency No. 3: Medical Issues

Who doesn’t get sick? Everyone in the family, including you and most especially you, will experience weakness from time-to-time. If you don’t take care of yourself, then all of your savings might go to medical expenses.

Having a dedicated Emergency Fund could help address any medical emergencies. If you can’t fully commit to your P100 per day savings, then at least get yourself covered. There are several insurance companies that offer health insurance coverage to OFWs like you. Take advantage of that because who knows what’s going to happen to you, right?

Of course, prevention is always better than cure. Eat healthy, sleep well, get some rest, and learn to say no to things presented in front of you. Remember, health is wealth.

Emergency No. 4: Home Repairs or Renovation

Let’s say the roof is leaking or the pipes in the kitchen were busted. You could either fix it immediately or not worry about it until it gets worse.

Clearly, you are for option number one.

It’s hard to predict when home repairs are needed, which is why it is important to be prepared for it. Your Emergency Fund plays a crucial role in this, so make sure it has sufficient funds to cover for the expenses.

Emergency No. 5: Business-Related Expense

This is applicable if you have an existing business.

Having your own business, no matter how small it is, could help you a lot while you’re still working overseas. It helps augment finances back home and the burden does not necessarily lie on your shoulders alone.

Of course, maintaining a business could also mean costs. You might experience shortage in your cash flow, which could translate to inability to buy new supplies or late rental payments.

The good news is there are financial institutions like Balikbayad that could help you on this arena. You could borrow up to P500K with low interest rate and minimal requirements. Simply fill out the online application form and a Balikbayad representative will get back to you as soon as possible.

The bottom line is preparation. These emergencies may or may not happen but at the end of the day, what matters most is how well and how early you prepared for it. You can do that starting now.

Digital Banking for OFWs: Yay or Nay?

At this day and age, almost everything can be done with just several clicks. Believe it or not, you could pay your bills, do some shopping, transfer money, and make reservations among many others online.

Because of this, banks are slowly transitioning to digital or online banking. After all, it is more convenient to do transactions online. Instead of going physically to the bank, all you need is your phone and Internet connection to do what you have to do.

Apparently, not everyone are willing to join the bandwagon and go digital. Many are scared of potentially losing their money, a concern that is totally understandable. If you are an OFW, then digital banking will make your life easier.

In fact, here are the pros of digital banking:

You can bank anytime, anywhere.

This is, by far, the top reason why you should go digital when it comes to banking transactions.

Picture this: you are on your way to work when you received a message from your wife back home about an emergency. They need the money and you don’t have time to look for a bank or remittance center where you can send cash.

Through digital banking, you will be able to do banking transactions like transferring funds or paying bills. You can also easily check how much money you have left in your bank account.

Going back to the scenario, you could simply connect to the Internet and send money to your family back home.

Banking fees are reduced.

Every movement in the bank entails cost. In fact, one of the reasons why banks charge higher interest rate or require you to pay processing fees is because they need to cover administration expenses. Banks have to pay for their employees, maintenance and security personnel, banking equipment, and the list goes on.

Digital banking reduces these fees. When you transact online, manpower is eliminated. This is also the reason why they don’t require you to have an initial deposit and maintaining balance, which is good for you.

Paperless transaction is encouraged.

Admit it. You tend to keep receipts and documents given by the bank to make it easier for you to trace your transactions. When you do this, you invite clutter in your room.

This is the beauty of going paperless.

Did you know that by embracing digital banking, you could help rehabilitate million hectares of degraded forest? Who knew this could be eco-friendly, right?

On the other hand, digital banking could be an issue. Here are of the disadvantages of going online:

There are cash deposit issues.

Transferring money is not an issue. What if your bank account has limited funds and your family back home needs the money? Obviously, your phone cannot accept cash deposits, which is one of the biggest concerns for digital banking.

To address this issue, banks partnered with financial firms like DragonPay and Visa to make it easier for you to deposit money. You could also deposit money through Bayad Center, a task that you could do in case you’re in the Philippines.

7/11 is another option where you can deposit money through their digital kiosks. 

You are prone to cyber-attacks.

This is the biggest issue surrounding digital banking. Despite the convenience, there will always be cyber-security issued that could potentially affect your current balance.

The good news is you could do something to protect yourself and your money against hackers.

Here are safety features you need to do and remember:

  • Assign stronger passwords.
  • Change your password regularly, preferably once a month.
  • If two-factor authentication feature is offered, then make sure you enable it.
  • When doing online banking transactions, make sure you connect to a secured network and avoid using public WiFi access.
  • Password should be for your eyes only. Never share it with anyone.
  • Download and use the bank’s official app or website.

Should you go for digital banking? There’s no problem with that. Just make sure you take note of the safety features to protect your account.

Should You Get Your Friend to Guarantee Your Loan?

Let’s say you have a business in mind that you want to do. Or you need additional cash to pay for your medical expenses or existing mortgage. Apparently, you can no longer borrow money from any of your relatives. Borrowing from your friends may not be a good option as well because let’s face it, they have needs too.

What is your next option? You apply for a loan, or a personal loan to be exact.

Here’s the thing: applying for a personal loan means you need collateral to guarantee your loan.

“I don’t have any property or car under my name. Paano na?” or “I have unpaid debts.

Don’t worry. You can still apply for a personal loan as long as you can find someone to guarantee the loan for you. Here’s how and why having a guarantor can help you with your loan application:

  • Guarantor serves as a collateral for the loan you’re applying for. When you have a collateral, this means your loan is secured, which also means you have extra room for negotiating your loan terms.
  • There is a higher chance that your loan application will be approved. Having a guarantor means your loan is secured, thereby giving lenders peace of mind that your loan will be repaid.
  • This increases your credit worthiness as a debtor. This means lenders are willing to give you a lan because there is a lower risk of non-payment.

The next question is this: who should you get as your guarantor?

Your guarantor should meet the following requirements:

  • Must be between 18 and 75 years of age
  • Financially stable, meaning your guarantor is earning stable income every month
  • Has good credit standing, which means no past due accounts or unpaid debts
  • Met the minimum income requirement set forth by lenders
  • Capable of making monthly payments in case of default
  • A homeowner, although this qualification applies to some lenders
  • All other qualifications required by your preferred lender.

The bottom line is your guarantor should be someone of legal age and who could help you pay your loan in case you are unable to do so.

Can your friend be your loan guarantor?

Believe it or not, yes, as long as he meets the requirements needed to be a guarantor. Ideally, your guarantor should be someone you trust like a close friend.

‘Apparently, this could be tricky. Any arrangement that involves money could potentially ruin relationships and surely, you don’t want that to happen.

What does it mean to be a guarantor?

The role of a guarantor is simple: to pay for the existing financial obligation in case the principal borrower is unable to pay due to unforeseen circumstances.

Despite that, guarantor will not have any share on the loan proceeds.

Aside from this, it’s not easy to find a guarantor who is willing to pay for your loan in case of default. That being said, here are some tips to help you guarantee your guarantor and make him say yes:

  • The guarantee must be in writing. Consequently, it should specifically state how much the guarantor will be liable, if ever, possible circumstances that will make him liable for the loan, and the duration of the guarantee.
  • Guarantee Agreement must be for one year first and may be renewed thereafter. The beauty of this arrangement is that once you can show to the lender that you are capable of paying the loan, then the guarantor may be released from his possible obligation.
  • Make sure that your guarantor gets a copy of all the loan documents, especially the Credit Agreement or Loan Contract and Guarantee Agreement.
  • In case of any changes in the terms of the loan, inform the guarantor right away.
  • Ensure your guarantor that he will only guarantee the loan up to the amount equivalent to the loan amount. This is to give assurance to him that he won’t be made liable for a loan beyond what was agreed upon.
  • Keep your guarantor updated on what’s happening in your loan. This includes any financial decisions involving the loan he guaranteed, any advance payment or availment, and how much money you have among others.
  • Always be visible and easy to contact. Even if you are overseas, make sure you keep communication lines open. Don’t make it hard for your guarantor to contact you.
  • Ensure your solvency, which also includes doing everything you can to pay for your loan.

More importantly, there should be mutual trust between you and your guarantor. If you can’t trust each other, then it is best to move on and look for a new one who could help.

Even if you have a guarantor, make sure and do your best to pay for your loan. Don’t let anyone be burdened on an obligation that benefited you. Again, he is merely a guarantee and a form of security.

5 Practical Hotels in Metro Manila for Your Next Family Staycation

Finally, a much deserved vacation for you. You were allowed by your boss to go home for a week so you want to make sure that you make the most out of your stay. What’s the best way to spend time with them?

Well, there are tons of options but with limited time, you could try staycation.

“Mahal yan,” you might say.

That’s true. Still, there are hotels across the metro that are within your budget but don’t compromise quality of service. In case you’re interested, here are some options for you:

Privato Hotel, Ortigas

Privato Hotel is a business and lifestyle hotel located in Pasig. It is also located near Capitol Commons and Ortigas Center Business District, making malls like SM Megamall and Ayala Mall’s The 30th more accessible.

The hotel currently has 177 Italian-inspired with contemporary style rooms that will surely make you feel at home – without hurting your wallet. Your kids will love the pool area and if you’re thinking of having a relaxing view, eat dinner at the hotel’s Roofdeck.

Room rate starts at P1,907 per night.

Kabayan Hotel, Pasay

Staying overseas will surely make you miss not just your family but also the Philippines. If you want to experience that Filipino hospitality, then Kabayan Hotel in Pasay City should be part of your list.

Currently, the hotel has 276 rooms, each one offering a certain level of comfort. It also have Kapsule beds that will surely give you a glimpse of Japanese life. There’s also a free shuttle to and from SM Mall of Asia, which is perfect pasyalan for your family.

The best part is that the hotel has a dedicated OFW Center that is meant to provide you with a comfortable home.

Room rate starts at P3,481 per night

B Hotel, Quezon City and Alabang

In case you’re looking for Instagram-worthy hotel, then B Hotel might not fail you. Its sleek, modern, and industrial interiors set it apart from the other hotels in the metro.

If you’re staying in Quezon City branch, the hotel is walking distance to Tomas Morato area. On the other hand, the Alabang branch is strategically-located at Madrigal Business Park, thereby making “malling” easier for you.

Room rate starts at P3,268 per night. It also offers discounted rate if it’s your birthday month with free birthday cake.

The Legend Villas, Mandaluyong

If you insist on anything Filipino-related instead of the more modern venues, then you could try The Legend Villas in Mandaluyong. This 100 percent Filipino-owned hotel offers luxurious feel without hurting your budget. It also has its Old World charm – from Venetian glass-framed mirrors to curved staircase to Filipino design of rooms – in an urban setting. Amenities like swimming pool, gym, and restaurants are there as well.

We suggest that you get the Deluxe Room for your family, which is spacious enough to fit a family of four OR the Team Suite, which has dining and living areas.

Room rate starts at P3,300 per night. You might want to book in advance, at least 10 days before your scheduled arrival, to avail up to 20 percent discount on room rate.

KL Serviced Residences, Makati

Makati is the place to be because it has everything you need – food, places to see, malls, and the list goes on. If you want to explore the country’s premier business district with your family, then consider staying in KL Serviced Residences.

This apartment-style comes with amenities that will make you feel at home. If you’re willing to spend a little extra, opt for two-bedroom suite, which has fully functional kitchen and dining area. Internet is not a problem as well, so you could stay connected at work just in case.

Room rate starts at P2,440 per night. You could also get deals from coupon websites for discount on bigger rooms.