Philippines Mortgages for Non-Residents
How to Get a Mortgage in Philippines as a Foreigner
Navigating the vibrant real estate landscape of the Philippines requires a keen understanding of its unique financing environment, especially for foreign buyers
Philippines Mortgage Market Overview
Financing options in the Philippines offer diverse opportunities for both local and foreign investors. With competitive interest rates and a variety of mortgage products, investors can tailor their financing to suit specific needs. The country's robust banking sector provides reliable support, though investors should be mindful of processing times and ensure they meet all requirements for approval.
Non-Resident Deposit Requirements
Foreign buyers in Philippines typically need a larger deposit compared to residents. Most banks require 25-40% down payment for non-resident mortgages. Plan your financing accordingly.
Why Invest in Philippines?
- Reason 1: Strong economic growth with a GDP growth rate averaging 6% in recent years.
- Reason 2: Favorable tax environment with incentives for foreign investors in certain sectors.
Financing Trends: Mortgage Rates, Inflation & GDP Growth
Loading trends...
Historical view of mortgage interest rates, inflation trends, and economic growth indicators.
Affordability Metrics: Price-to-Income & Rental Yields
Loading affordability data...
Track property affordability through price-to-income ratios and rental yield percentages over time.
Loading comparison...
Current Financial Indicators (2024)
Inflation Rate
3.3%
Interest Rate
6.25%
• Higher price-to-income ratio (27.0) reflects premium market positioning and strong demand.
Popular Lenders in Philippines
BDO Unibank
Residential properties, foreign buyers
Contact: international@bdo.com.ph
Metrobank
Vacation homes, urban properties
Contact: global@metrobank.com.ph
Bank of the Philippine Islands (BPI)
Commercial properties, mixed-use developments
Contact: contact@bpi.com.ph
Security Bank
Luxury properties, foreign investors
Contact: info@securitybank.com
RCBC
Residential and commercial properties
Contact: global@rcbc.com.ph
Investment Tips for Philippines
Tip 1: Focus on properties near transport hubs for better rental yields.
Tip 2: Consider areas with upcoming infrastructure projects.
Tip 3: Invest in mixed-use developments for diversified income.
Tip 4: Look for properties in established business districts.
Tip 5: Explore vacation rentals in tourist-heavy areas.
Tip 6: Assess the developer's track record before buying pre-construction.
Tip 7: Use local property management services for efficiency.
Tip 8: Stay informed about local real estate regulations.
Tip 9: Diversify your portfolio across different cities.
Tip 10: Leverage financing options to maximize returns.
Property Prices by City in Philippines
| City | Price/m² | Rental Yield | Price Growth | Popular Areas |
|---|---|---|---|---|
| Manila | €3,500 | 5.0% | +6.5% YoY | Makati, Bonifacio Global City, Ortigas Center |
| Cebu City | €2,800 | 5.5% | +5.0% YoY | IT Park, Mactan, Banilad |
| Davao City | €2,200 | 6.0% | +4.8% YoY | Lanang, Matina, Buhangin |
| Tagaytay | €1,800 | 4.5% | +3.5% YoY | Silang Junction, Mendez, Kaybagal |
| Baguio | €2,000 | 5.2% | +4.0% YoY | Session Road, Camp John Hay, Mines View |
How to Get a Mortgage in Philippines
Local banks in the Philippines are increasingly working with foreign buyers to provide mortgage options. Typically, these banks require a down payment of 20% to 40%, with interest rates ranging from 6% to 8% per annum. Loan terms can extend up to 25 years, offering flexibility for investors. Key documentation includes a valid passport, proof of income, employment verification, and bank statements. Foreign buyers may also need to present a credit report and, in some cases, a Special Resident Retiree’s Visa (SRRV) to qualify for a mortgage.
Advantages
- ✓Competitive interest rates
- ✓Potential for tax benefits
- ✓Access to prime real estate locations
- ✓Flexible payment terms offered by developers
- ✓Strong economic growth prospects in the Philippines
Considerations
- ✗Lower loan-to-value (LTV) ratios for foreigners
- ✗Currency exchange rate risk
- ✗Complexity of documentation requirements
- ✗Potential restrictions on land ownership for non-residents
Philippines Mortgage Requirements for Foreigners
- 1Valid passport
- 2Proof of income
- 3Bank statements (last 6 months)
- 4Credit report
- 5Employment verification
- 6Special Resident Retiree’s Visa (SRRV), if applicable
- 7Property reservation agreement
Pro Tip for Foreign Buyers
Start gathering your documentation 2-3 months before applying. Non-resident mortgage applications typically require notarized translations and apostille stamps for foreign documents, which can take several weeks to process.
Calculate Your Mortgage
Use our interactive mortgage calculator to estimate your monthly payments for a property in Philippines.
Mortgage Calculator
Mortgage Summary
Financing Tip
Your down payment of 20% or more typically qualifies you for the best available rates.
Common Pitfalls to Avoid in Philippines
- ⚠Pitfall 1: Avoid over-leveraging your investment.
- ⚠Pitfall 2: Watch out for hidden costs in property transactions.
- ⚠Pitfall 3: Be cautious of properties with unclear titles.
- ⚠Pitfall 4: Don't underestimate maintenance costs.
- ⚠Pitfall 5: Avoid properties in areas with declining populations.
- ⚠Pitfall 6: Be wary of unrealistic rental guarantees.
- ⚠Pitfall 7: Ensure compliance with local zoning laws.
- ⚠Pitfall 8: Avoid investing based solely on emotion.
- ⚠Pitfall 9: Don't neglect due diligence on property developers.
- ⚠Pitfall 10: Be cautious of market speculation.
Developer Financing in Philippines
Property developers in the Philippines often offer flexible financing plans to attract foreign investors. These plans typically involve a reservation fee, followed by a series of scheduled payments. A common structure includes a 10% to 20% down payment, with the remaining balance paid over a period of 24 to 60 months. This staged payment approach allows buyers to manage their finances effectively while securing property in prime locations. Understanding the terms and conditions of these payment plans is essential for making informed investment decisions.
Due Diligence Required
Always verify the developer's credentials, track record, and financial stability before committing. Request to see building permits, completion guarantees, and consider using escrow accounts for staged payments.
Typical Payment Structure
Advantages
- ✓Competitive interest rates
- ✓Potential for tax benefits
- ✓Access to prime real estate locations
- ✓Flexible payment terms offered by developers
- ✓Strong economic growth prospects in the Philippines
Considerations
- ✗Lower loan-to-value (LTV) ratios for foreigners
- ✗Currency exchange rate risk
- ✗Complexity of documentation requirements
- ✗Potential restrictions on land ownership for non-residents