Bank finance or Pag-IBIG

[rockmountman]

House and lot value is Php 2.8 M.

ChinaBank offered me a 6.25% interest fixed for 3 years. May repricing every year after the 3rd year. The loan term is 20 years. This is a good deal but baka tataas yung interest (most likely) after the 3rd year.

Pag-IBIG offered the same interest at 6.25% for 3 years. The loan term can be up to 30 years since I’m 25 years old. But the caveat is I need to cash out around Php 300K kasi yung allowed loanable amount lang ni Pag-IBIG is Php 2.5 M lang.

In terms of the monthly amortization, mas mababa talaga si Pag-IBIG pero konti lang yung difference niya sa bank. Both of them nasa Php 16-20K monthly, which is okay naman.

What would you choose in terms of:

• Mas cost-effective (sulit) in the long term.
• Pros and cons of Pag-IBIG and bank (ChinaBank). Meron ba kayong experience with ChinaBank? Kumusta naman yung taas ng interest per year?
• Mas sulit ba na mag cash out ng Php 300k sa Pag-IBIG over the long term?
• Mas okay ba na i-max out yung number of years for the loan term (i.e., 25 for bank and 30 years for Pag-IBIG)

Any insights and experiences are much appreciated. Thank you so much!

 

[gazelle512]

@rockmountman I suggest to get a long fixed term, like 10 years.

Sobrang taas ng repricing. For example in my case, amount before repricing is less than 10k. After repricing, it became 12k plus, because interest becomes hinged upon market rates of interest rates.

Also, suggest don’t max out the term. Try to compute the total amount you will pay, and you will see that the longer your mortgage is, the higher total interest amount you will pay.

Bottom line, you will save when you shorten the term as much as possible. But make sure the amortization amount is comfortable for you.

 

[jg_lrd]

@rockmountman I suggest PAGIBIG. Same sila ng interest, but when the time na may extra money ka na, you can pay directly sa pagibig for free (as long as your payment would be higher sa monthly amortization mo). With the direct payment against sa principal, you can shorten your long term and you can save up interest. Unlike sa banks na may fee when you do that (loan restructure)

For me, not ok i-max out yung loan term mo. Assess your salary. And ano ba future plan mo? Kung magsave ka money for business, mag max out ka.

 

[jcp1988]

@rockmountman for pagibig, hindi ganun kahigpit. kahit.i.e. delayed payment or missed payment. pwede ka din pag pay to principal kung may extra money ka para mashorten yung term