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Tuesday, December 12, 2017

The Dangers of In-house Financing

Tuesday, December 12, 2017 0

I have seen some rants and complaints via social media among my peers and network regarding in-house financing. As someone involved in the Real Estate & Finance industry, I try to make it a point to talk about ‘difficult topics’ or even taboo ones which very few people seem to talk about.

When buying a home or a new condo-unit, there are about four ways to purchase a property: cash, Pag-ibig HDMF, getting a bank to finance your purchase, or leveraging on the available in-house financing options offered by property developers.

Not everybody has cash to pay for a property immediately, so let’s start with Pag-ibig. The Home Development Mutual Fund (HDMF) or Pag-IBIG Fund has made it easier for a Filipino minimum-wage earner to own his or her very home in the Philippines without needing a lot of cash. Because it is a government-supported initiative (and a mandatory employment benefit), interest payments and amortization are not that expensive. But you can still be turned down if you’re a credit risk.

Banks on the other hand are known to be particularly stringent in their loan application processes, requiring a handful of documents that need to be submitted (financial statements, ITR, COE, payslips, business registration and valid identification) and will have to undergo review/investigation.

However, in-house financing options are technically not loans. These are extended payment terms (installment) with above average interest rates. It does not require that much paperwork outside your certificate of employment or source of income. As such, there is a low chance to get denied.

Because it doesn’t undergo the same rigorous review, in-house financing is relatively “easier” and less time-consuming to comply with compared to the Pag-ibig/bank’s process.

To add, in-house financing actually has a higher interest rate compared to banks, with a range of 14% to 18% for a shorter period (5 years only). The rates are “allegedly fixed” and not subject to economic volatility, HOWEVER – these In-House Financing schemes are not regulated at all; which could be abused easily as well.

To be regulated means that there’s an authority creating a quality control of a subject system, its process or its product. The need for greater regulation is obvious.

Digging Deeper

Bare-in-mind that ‘lending’ or ‘financing’ are not property developers' core expertise, so there might be some serious underestimate in the credit worthiness of home buyers as well as in implementing the whole “financing” mechanism that they offer.

Property Developers will of course praise the convenience of “in-house financing” but the reality is, no one is monitoring this; we don’t know how much the actual exposure of this particular “real estate lending” may be and perhaps it is understated (technically shadow banking). SEC, BSP don’t monitor it due to jurisdiction issues. And HLURB is not equipped to deal with such things either.

I’m not saying it’s a bubble but it is a real risk that nobody seems to be talking about and should disaster strike, a lot of families as well as the sector/economy will be affected.

Even if it is not ‘CONVENIENT’, I think it is still better to go for bank or Pag-ibig financing as they are regulated and also because they have MRI – Mortgage Redemption Insurance. Pag-ibig’s MRI states that: “MRI renders the housing loan fully paid upon death of the borrower provided the
amortization payments are up to date.”

“Caveat emptor”—let the buyer beware (and Be Aware)!


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Originally Published in Philstar - The Freeman Newspaper last December 12, 2017.
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Monday, December 11, 2017

Dalaguete's Watch Tower: Casino or Lugsanan Peak in Cebu

Monday, December 11, 2017 0


The ragged peaks of Mantalongon Highlands Range is among the most picturesque mountain peaks not only in Cebu but perhaps even in the entire Philippines (maybe! :D). The mountain range borders the towns of Badian and Dalaguete and covers various sitios and barangays of the two towns. It is "branded" as lugsangan peak (aside from Casino Peak) by the local/s government as it is located in Sitio Lugsangan in Barangay Tabon, Dalaguete, Cebu.

It features countless conic peaks a bit similar to that of Bohol’s Chocolate Hills and that place in Albay.

This is my third time vising the Mantalongon Highlands but always with different peaks. See the following posts for more info about Kandungaw peak as well as Osmena Peak:


For years, Casino or Lugsangan Peak has remained a secret while Osmeña Peak of Barangay Mantalongon has gained popularity and has even been included by the local government unit's tourism initiatives. I have known of this peak for quite some time already but lacked to willing and able companions to visit the place. But when we arrived there, the government has erected a poster already.

I visited the place together with a Travel Blogger - Johanna, visit here blog at www.beanintransit.com
I take this as the early signs for it to be developed by the local tourism authority although there was no fees yet when we arrived there. But perhaps there will be in the future once the volume of visitors picks up.

The tower-like Lugsangan Peak
Lugsangan or Casino peak looks like a imposing watch tower below as well as on top as there are two edges in which there are different views. One side shows the jagged mountain peaks while to other edge shows the coast showing the neighboring town of Badian, overlooking the towns of Ronda, Moalboal, Argao and Alcoy, and the islands across Tañon Straits as well as part of the jagged mountain range.

This is Bean-in-transit's signature pose but that's not the point. This is the coastal view.
This is the different angle from the side while the picturesque jagged peaks is shown on the first Image of this post above.

Like other sitios in this hinterland of Dalaguete, Sitio Lugsangan is typically rural and laid back. Its high elevation makes the climate temperature fairly cold/cool and making the soil ideal to grow high value crops such as lettuce, carrots, tomatoes, beans and onions, among others.

Getting There:

There’s basically two ways to visit this place. First is you go to OPeak and hike towards Casino Peak or from the highway (or Mantalongon Market), you hire a motor-taxi (habal-habal) to directly bring you to Sitio Lugsangan; that is if you are commuting. The other options is by private vehicle. Or perhaps you can ride from Maloray, if you came from Kandungaw Peak.


You don't have to visit everything in one go unless if you are in peak physical condition and if you are planning to camp in one of those peaks (Opeak or Kandungaw). I don't think there's a proper place to camp near Casino as it's really rocky and civilization is within reach as there are houses below the peak.

You will be needing a guide or assistance from the locals specially if you are first timer and you decides for the long trek. You may need a guide if you are coming from OPeak.


If you are commuting from the City, you either ride a Ceres bus (At south bus terminal) which drops you off the highway corner heading to Mantalongon or ride a bus from Colon that will take you directly to Mantalongon Public Market - these will cost you about Php120-150.


If you came from the highway, it's even more expensive since you will pay the Habal-habal driver Php150.00 one way so that's Php300.00 back and forth (It's more expensive now compared to the first time we day-trekked to Opeak). If jumping off from the Mantalongon Market, the cost is about Php40-50. Might as well walk from Mantalongon Market, yes? If the budget is really tight that is. :D

Check out the VLOG I made on this Day Hike below!

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Sunday, December 10, 2017

Sun Life Financial Philippines honors Financial Literacy Advocates at Sinag Awards 2017

Sunday, December 10, 2017 0


Last week, Sun Life Financial Inc. recognized anew on Wednesday, December 6, at the Fairmont Hotel, Makati City the vital role of the journalists and online influencers in achieving its goal of enabling a financially literate country. This is my first time sharing the same stage with the President of Sun Life Financial Philippines, Ms. Riza Mantaring (above)! And YES I FINALLY WON!! BWAHAHHAHA

Now on its 4th year, SINAG: Financial Literacy Journalism Awards 2017 continues to be a nationwide competition, open to print journalists and digital influencers from Luzon, Visayas, and Mindanao.

Various stories that tackle subjects related to financial literacy, such as entrepreneurship, long-term financial planning, studies about the Filipinos’ financial habits, and updates about the market were all welcomed. These simply need to be educational, inspiring, and useful in helping Filipinos appreciate the topic of finances, the importance of money management, and the benefits of financial security.

What do you see? An award? A carved piece of glass? A reason for praise? Admiration? Inspiration? Motivation? Celebration? I see an outcome. A #goal achieved. The process of cause and effect. For some context and #perspective my dear friends; the first entry I submitted for this was way back in 2014. I have tried again and again, until I finally did it this year 2017. I'm not perfect, heck I don't even see myself as talented as the others in this space. But I did it anyway. It was not easy, #rejection never is and the outcome was not the way I imagined it; whether you #win or lose, #succeed or fail, you still win and will continue to win compared to those who do not start. Thank you for all those who have shown their support as well as to @sunlifeph ; be grateful, always! #gratitude #hustle #grateful #yolo #dailygratitude #award #philippines #reflection #personalfinance #financialliteracy #life #milestone #thankful #faith #adventure #climb #grind #rise #finance #financialeducation
A post shared by Vernon Joseph Go (@vernonjosephgo) on


And the winners are..
  • Digital category winners: Maria Nimfa Nadtja Villaver of liitatpayat.com (Grand Winner), Clariza Gino of savingspinay.ph (1st Runner Up) and Grace Maulion of tipidmommy.com (2nd Runner Up)
  • Print category winners: Daxim Lucas of Philippine Daily Inquirer (Luzon), Vernon Joseph Go of The Freeman (Visayas) and Nelson Bagaford of Sun Star Davao (Mindanao)
  • Student category winners: Joevane Bitad of STI College – Alabang; Franchesca Pauline Cantos of Miriam College; Miraclene Moltio of University of Baguio and Bea Nicole Amarille of University of Sto. Tomas.
Photo-Op with the Luzon-Metro-Manila based bloggers
About Sinag Awards:
Sinag Awards is Sun Life's way of honoring the efforts to boost financial literacy in the Philippines through the stories from print, digital and the like channels. This advocacy remains as crucial as ever, as we all strive to lead more Filipinos towards the path to financial freedom

Launched last 2014, Sinag is an annual competition participated by print and digital journalists whose best works are recognized for helping educate the public to be financially responsible and educating them on the right habit and tools to be successful on their financial journey.

Sun Life Financial is a leading international financial services organization providing a diverse range of protection and wealth products and services to individuals and corporate customers.

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