Purchasing real estate in the Philippines pretty much follows a general process, whether you’re buying from a developer or from an individual seller. Here’s how it goes:
Step 1: Property Information
The transaction begins with you, the prospective buyer, learning all you can about the property. Clarify what is included or not in the transaction such as house finishes or appliances that will be left behind by the previous owners. You should also be aware of the property’s condition if it is for pre-selling, currently mortgaged or if there are illegal settlers. You can ask the seller or the sales agent directly as well as researching from the Internet.
Step 2: Terms and Conditions
The next phase begins with the discussion of the seller’s or the developer’s terms and conditions, specifically to the payment and move-in schedule. These are usually non-negotiable with a developer but they offer different options instead. For private sellers, there is a bit of leeway to haggle the price and length of time for the payment period.
Step 3: Reservation
To signify your intent to purchase a specific property, a reservation fee is usually given to the seller or the developer. This amount is often non-refundable if ever you decide not to continue with the transaction, and may or may not be a part of the downpayment.
Step 4: Documentation
This step refers to signing of the legal contracts and submitting any required documents. This usually consists of some form of personal identification, proof of civil status and proof of income; the latter is important especially if you will be applying for a loan.
Step 5: Downpayment
This initial amount can be a one-time deposit or a monthly payment for a certain time frame, depending on your agreement with the seller or a developer. The specific percentage of the total amount that makes up the downpayment is one of those terms discussed in Step 2, so all that’s left in this step is to pay up as agreed upon.
Step 6: Turnover
This step is where buying from an individual seller or from a developer differs more. A developer often turnovers the property to the buyer at this point in the transaction depending on the set time frame earlier. An individual seller on the other hand, may opt to not turnover a property unless the total amount is fully paid so there would be a step before this wherein the full payment happens. The agreement of when a property will be turned over to the buyer is part of the terms and conditions discussed in Step 2.
Step 7: Amortization
If you borrowed from the bank or from the developer, then your final step in the purchase is paying off your loan. This is often in a monthly basis with an applied interest rate for a certain number of years. You can make bigger payments usually at the end of the year or on the loan’s anniversary depending on the lending institutions’ policies.
Credits: Featured image from YouTube