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Why It’s Okay To Consider Home Loan Refinancing

One of the main reasons why you wanted to work overseas is to be able to provide a better life, standard of living, and future for your family. This includes buying a house that you can call your own home.

Still, the reality is buying a house includes at least a million and you cannot easily shell out the amount. What you do is to apply for a Home Loan through PAG-IBIG or your preferred bank to help finance the purchase of your home.

Unfortunately, pandemic hit the entire world and your job overseas is affected. You’re also worried that you might lose the house you built for your family. Still, you have no choice but to pay since this is borrowed money after all.

How can you save the house you built? Consider home loan refinancing.

What is home loan refinancing?

Refinancing of home loan is the process of paying an existing mortgage using proceeds of a new loan from a different lender. Compared to the old home loan, the new one has lower interest rate and better terms since the purpose of this facility is to help borrowers become more able to pay off the home loan.

Why should you opt for home loan refinancing?

You can get lower interest rate.

Home loan refinancing is all about timing. Because of the pandemic, the Bangko Sentral ng Pilipinas reduced the interest rate to 2.25 percent, the lowest policy interest rate in the history, by far (1). This is to help reduce the impact brought about by the Covid-19 pandemic by making repayment easier.

What is the effect on your home loan interest rate?

Low policy rate means mortgage rates are low as well, which all lenders must strictly adhere to. Your monthly repayment will be lower, too, because the interest rate is decreased by at least one to two percent. This allows you to have additional savings, which you can use for other equally important obligations.

You want to change your loan repayment term.

Longer loan term is not always recommended because you’ll end up paying more because of the interest. On the other hand, short loan term is not ideal, too, because monthly repayment is higher and heavier on the pocket.

When you refinance your home loan, you can negotiate about how long you plan to pay it off. The good thing about this is that whether you choose short or long loan term, you are still able to save because of the lowered interest rates.

You want lower monthly payments.

Think about this: your current home loan lets you pay P10,000 every month. Because you opted for home loan refinancing, you can enjoy a lower interest rate, thereby reducing your monthly amortization to P8,000.

That P2,000 can be considered as savings or an additional fund to pay off other expenses like monthly utility bills.

You want to consolidate your existing loans.

Let’s say you also have other loans like personal loan or auto loan. Did you know that you can consolidate these together with your home loan into one loan?

Typically, personal loan and credit cards have higher interest rates. When you consolidate it with your home loan, you can enjoy lower rates, which means you will be able to reduce the amount of money that goes into loan payment.

The best part is you only have to worry about one loan. There’s no more excuse for missed or delayed payments just because “you forgot.”

Scout for lenders that offer home loan refinancing. Explore the features since every lender have different offers. Find an offer that you can greatly benefit from. You will be able to save more money, which you can re-allocate for savings, payment of utility bills, or fund for your new online business. More importantly, you won’t lose your home that you built for your family.

References:

(1) https://www.cnn.ph/business/2020/10/1/BSP-policy-rate-decision-October-2020.html

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7 Online Business Ideas You Can Try While Waiting For Deployment

It’s not easy to stay in the country, especially when you know that there are bigger and better opportunities overseas. You have mouths to feed and you need to ensure that your family will have a better future; hence you seek greener pastures.

Because of the pandemic, you have no choice but to either go back home or wait for the lifting of travel restrictions so you can apply overseas again. Unfortunately, bills won’t stop coming and your kids need gadgets as they go to their online classes. Your emergency fund is slowly depleting because of the never-ending expenses.

At this point, you decided to venture into online business to earn extra. Even with limited funds, you can still do these business ideas, some perfect for the coming Christmas:

Covid-19 Essential Items

Because of the pandemic, there is a sudden demand for face masks and face shield. Alcohol and other disinfectants are also among the most sought after products. These are now considered as essential items and whatever happens, people will buy these products because they are needed.

Find a supplier with a friendly, reasonable rate and then sell the items online. Your prices must also be within the SRP otherwise, people won’t buy from you. Consider selling items in bundle, say face mask plus face shield, or give free delivery to attract customers. Once you build your customer base, you can start adding other products.

Homecooked Meals

This is among the popular businesses today. Despite the presence of many food sellers, selling homecooked can still be a good business for the simplest reason: who doesn’t eat?

If you have a dish that you can be proud of, then go ahead and offer it. The good thing about this business is that you don’t need to shell out a huge amount of capital. Simply buy the ingredients and containers and you can start selling your famous dishes.

Baked Sweets And Goodies

If cooking is not your thing, then try baking instead. A lot of people can’t say no to a box of chocolate chip cookies or brownies. Everyone needs a bag of pandesal, too.

You can follow the mainstream but if you want to stand out, then try coming up with new food combinations. This will make it easier for you to break into the market.

Make Your Own Beverages

Have you noticed the sudden rise in coffee sellers? You probably saw on Facebook a lot of people selling handcrafted beverages, too. There are even some who focus on cocktails, which can also be a potential for business.

Coffee, milk tea, fruit juices, or even as simple as samalamig, selling drinks can be a good business because who doesn’t need it, right?

Sell Your Preloved Items

For sure, you got tons of items bought when you were still working overseas. You might have unused clothes, shoes, or even items like watch and perfume lying around the house. Why not sell these items and make money out of it.

You can also sell preloved items. Just make sure these items are in very good condition so you can make a good deal out of it.

Become A Reseller

Being a reseller is one of the easiest things you can do if you want to venture into online selling. There are many things you can sell such as food, skincare products, clothes, books, and the list is endless. The good thing about this business is that you don’t have to make a particular product. In case stocks are running out, you simply have to order again from your supplier.

Still, don’t take lightly. Even if it’s not yours, per se, you are responsible for the brand/s you are carrying.

Courier Service

Companies like Grab and Lalamove are on the rise these days because many people are resorting to online shopping. If you have a motorcycle, then maximize it and offer courier services.

Some startup companies prefer in-house delivery service so if you’re up for it, then offer your services. Or advertise this service on your social media accounts. Just make sure to follow health protocols so you won’t get Covid-19.

Earning additional income these days will help a lot in augmenting financial difficulties. Keep in mind that online selling will not be easy. You need to set yourself apart from the other sellers to make your business stand out.

There is no perfect formula but it helps if you will offer unique products, sell items with reasonable prices, immediately respond to customers, and be respectful. Who knows, it might be a stepping stone to something bigger.

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POEA Guidelines On Deployment And Repatriation Of Filipino Seafarers

Overseas Filipino Workers are heavily affected because of the pandemic. According to Defense Secretary Delfin Lorenzana, more than 174,000 OFWs were repatriated since the start of the pandemic (1).

However, repatriation is easier for land-based workers since their location can be identified easily. What about seafarers?

Unfortunately, it is more challenging for seafarers to be repatriated by the government. An estimated 300,000 migrant seafarers around the world were unable to disembark and forced to stay in the shipping vessel due to restrictions (2). In the Philippines, about 80,000 Filipino seamen are stranded at sea and have lapsed contracts, although the government is doing the best it can to bring them home (3). Nonetheless, job openings keep on coming and there are still thousands who are considering getting a job at sea.

In line with this, the government, through the POEA, released Governing Board Resolution No. 13, which serves as a guide on the deployment and repatriation of Filipino seafarers.

Here’s what you need to know:

When the seafarer cannot be deployed due to Covid-19 –

Let’s say you already have a signed Employment Contract and all your documentation requirements are complete. You are also scheduled to leave on a certain date – until Covid-19 happened.

Due to travel restrictions that resulted to flight cancellations and regulations issued either by the Philippine government or your country destination, you cannot be deployed.

In that case, the seafarer shall be provided food and accommodation at the principal or employer’s cost. This will be until the seafarer is deployed OR the contract was cancelled.

When the seafarer was deployed BUT become stranded during transit –

You were finally allowed to leave the country. On your way to the country destination, you were stranded because of Covid-19 related reasons. You can’t even go home due to flight limitations.

If you were stranded during transit, then you will also have the right to paid basic pay, accommodation, food, and medical benefits at the cost of the principal or employer. This is until the seafarer is able to join the vessel.

If the seafarer’s service was terminated for a just cause but not related to Covid-19 –

If the seafarer is stranded and cannot go back home because of the pandemic, then the employer shall provide food, accommodation, and medical benefits at their cost until the seafarer can go back to the Philippines.

The employer or principal can recover the costs in accordance with the Employment Contract or Collective Bargaining Agreement.

In case of repatriation –

When a seafarer is bound for repatriation due to reasons related to Covid-19, then s/he is entitled to paid basic pay, accommodation, food, and medical benefits at the expense of the principal or employer. This is until the seafarer is repatriated and able to come home in accordance to Philippine protocols on OFW repatriation.

OFWs may avail of the Balik Probinsiya program so you can go back to your province. In the meantime and while in the quarantine facility, seafarers shall be provided food and accommodation at principal or employer’s expenses, unless otherwise provided by the government.

In case the seafarer cannot be repatriated –

There are several situations to consider:

  • If the seafarer cannot join the ship and currently in a quarantine facility shouldered by the principal or employer, then paid basic pay as well as benefits such as food and medical must be given until the seafarer either joins the ship or goes back to the Philippines.
  • If the seafarer completed his period of contractual service and his/her replacement is already on board, then s/he must be paid basic pay and afforded food, accommodation, and medical benefits by the employer or principal until s/he gets back home.
  • If the seafarer is still ashore despite the end of employment contract, then same benefits mentioned previously must be given.

Take note that these guidelines are in effect until March 15, 2022. It may be lifted or extended, depending on the situation. Nonetheless, let us all hope and pray for better days ahead.

References:

(1) https://mb.com.ph/2020/09/01/174000-ofws-repatriated-since-april-lorenzana/ .

(2) https://www.latimes.com/world-nation/story/2020-09-08/philippine-fishermen-stranded-at-sea-by-the-pandemic-we-think-about-jumping-overboard

(3) https://www.marineinsight.com/shipping-news/coronavirus-80000-filipino-seafarers-with-lapsed-contracts-stranded-at-sea/

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Study Now, Pay Later: Where To Get A Student Loan

Covid-19 affected many things, including one’s financial state. Since you’re back in the Philippines, you might find it challenging to look for other sources of income. Unfortunately, lack of funds isn’t limited to lack of cash for groceries or payment of bills. This could also adversely affect your kids’ tuition fee.

Because of the pandemic and the sudden shift to online classes, you have no choice but to also spend on laptop or tablet, upgrade your Internet connection, and dedicate a space for your kids’ learning, which also means additional expenses.

The thing is at the end of the day, education is important. In case you are short in funds, student loan is something you can consider.

Here are some educational assistance programs you can look into to finance your child’s education:

CHED’s Unified Student Financial Assistance System For Tertiary Education

Also known as UniFAST, the CHED Student Loan Program is open to all Filipinos who are undergraduate, graduate, medicine, and law students enrolled in public or private schools or universities. You can also borrow up to P60,000 per academic year, payable for one year.

Interest rate is zero percent IF the loan is paid before the semester ends. Otherwise, six percent interest will be imposed.

As of this writing, CHED Student Loan Program offers the lowest student loan in the country. To apply, make sure you submit the following documents:

  • Three copies of accomplished Application Form. You can access it here.
  • Photocopy of the applicant’s Certificate of School Registration
  • Photocopy of applicant’s school ID
  • Income Tax Return, payslip, Certificate of Employment, audited financial statements, or other proof of income of the applicant or applicant’s parents
  • Co-maker’s ITR, other proof of income, and government-issued ID
  • Two 1×1 photo of both the applicant and co-maker

Once you have all the documents prepared, submit the requirements to the office in charge of student loan applications in your child’s school. Thereafter, the school will forward the application to CHED.

If approved, then you will also be asked to open an account with the Development Bank of the Philippines since this is where the proceeds will be credited.

You can also learn more about the program here.

SSS Educational Assistance Loan Program

Known as EDUC-ASSIST, this student loan program is open to all SSS members below 60 years old, with monthly income of P25,000 or below, and with at least 36 posted SSS contributions, with six of which must be posted within the last 12 months.

You can borrow up to P20,000 per semester and payable up to five years for four- or five-year course OR up to P10,000 per semester and payable up to three years for two-year or vocational courses.

Interest is six percent per year. Take note that there is also a maintenance charge of two percent and penalty of one percent per month in case of late payment.

Below are the requirements:

  • Accomplished application form. You can access it here.
  • Valid ID
  • Assessment or Billing Statement from the applicant’s school
  • Proof of relationship to the applicant such as birth or baptismal certificate
  • Proof of monthly income such as latest payslip, Certificate of Employment, ITR, or notarized Affidavit of Source and Amount of Monthly Income
  • In case you cannot provide proof, you can issue a notarized Affidavit of No Income

You can submit the requirements to SSS branch near you. Make sure to present the original and photocopies of the mentioned documents. If approved, then you can claim the check from the Administrative Section of the SSS branch where you applied.

Unfortunately, this educational assistance program is only limited to one beneficiary. Also, online application is not yet available, which means you have to personally submit the application.

PAG-IBIG Multi-Purpose Loan

The agency’s Multi-Purpose Loan can be used for variety of needs, including payment for tuition fee and other school expenses. So if you are an active PAG-IBIG member with at least 24 months contribution, then you can apply for a multi-purpose loan to cover school expenses of your kids.

You can borrow up to 80 percent of PAG-IBIG regular savings with 10.5 percent interest per year. The loan is payable for up to 24 months with two-month grace period.

You can learn more about PAG-IBIG’s Multi-Purpose Loan here.

LandBank I-Study Program

If you need bigger amount for your children’s education, then Landbank can help. Through the I-Study Program, parents who are struggling in sending their children due to the pandemic can still do so to ensure education.

The bank’s I-Study Program allows you to borrow up to P300,000 with five percent per year interest. You can pay the loan in one year in case of short-term loan but for longer term loan, the amount plus interest is payable up to three years with one year grace period for the principal.

Other charges include loan processing fee, Documentary Stamp Tax of P1.50 for every P200, and penalty charges in case of late payment.

The good thing about this educational loan is that it covers all levels and not restricted to kids who are in college. In case you’re interested, you must prepare the following documents:

  • Accomplished loan application form
  • Valid ID of the borrower
  • Proof of income such as Certificate of Employment, pay slip for the last three months, and ITR
  • Proof of billing address from at least two utility companies
  • Enrollment or registration form from the school of the beneficiary
  • Form 138 or Certified True Copy for the previous semester or quarter
  • Certificate of Good Moral Character from the school
  • Schedule of payment of school fees and other expenses related to enrollment for each semester or the entire year

To apply, simply visit any Landbank branch near you. Make sure to bring all documents for verification. If approved, then you will be required to open a deposit account from Landbank for disbursement of funds. You can also check this link for more details.

There are still several banks and private institutions that offer student loans but so far, the ones enumerated here have the most affordable rates. Check them out and see which one suits best for your child’s needs. Don’t hesitate to ask for sample computations. More importantly, prepare all documents and make sure that you have a copy of the originals.

Although it may not seem a lot, the amount you can get can be helpful in getting your kids back to school.