NEWS: Bank urged to be vigilant in verification of titles

The Consumer Union of the Philippines (CUP) has expressed dismay over the reported P 389 million peso loan fiasco involving titles which victimized the Development Bank of the Philippines (DBP) and urged banks to reform their title verification and loan releasing processes.

In an earlier reports, a savings bank using allegedly spurious documents and highly questionable titles, obtained in a P 389 million pesos in loans from the DBP sourced from the Industrial Guarantee and Loan Fund (IGLF) jointly funded by the USAID, World Bank and Asian Development Bank. The suspicious nature of these documents was apparently discovered only much later after the loan had already been released and the Bangko Sentral conducted an examination of the bank's loan portfolio.

The CUP chairman Ambassador Raul Goco, a former solicitor-general, said this deplorable incident and many other similar cases over the years highlight the dangerous inadequacies of banks in filtering out dubious titles submitted as collateral for loans.

In view of these incidents and banking system's abnormally high inventory of non-performing loans (NPL) at some P 150 million peso, and other Real and Other Properties Acquired (ROPAs) currently amounting to more than P 250 billion pesos Goco said banks should immediately reform their lending procedures, as loans collateralized by dubious titles are never meant to be repaid in the first place.

The banks' disclaimers in the sale of their ROPOAs, which is practically disavow title authenticity, Goco said, amount to an admission of their failure to comply with the Supreme Court's rule requiring banks to have a much higher degree of diligence in verifying titles, beyond the standard "due diligence" practiced by ordinary dealers in the real property.

"From the many cases we have reviewed, it is only after the borrower has already absconded or failed to pay the loan that the banks discover the fake or fraudulent titles they have accepted as collateral", Goco said.

CUP President Quirino Marquinez, a practicing lawyer, said that for as long as banks continue with their present cursory title verification process conducted by their in-house appraisers or credit investigators, they will remain the principal target of fake titles syndicates.

Marquinez said these will preclude collusion between fake title syndicates and bank insiders, even as the use if independent, government-recognized title verifiers will ensure objective, non-self-serving, influence-free and transparent findings about the title, upon which any party - not just the lender, borrower or buyer - may rely.

The CUP urged banks to immediately subject titles covering their NPLs to a thorough verification process by third party independent verifiers so that should fake titles be discovered, appropriate action may be taken while they still can against the parties responsible, and immediately subject all ROPAs to the same process so that appropriate adjustments may be made in the bank's financial statement to reflect the factual values of said ROPAs for the general public to know.

Source: Manila Bulletin (February 24, 2008)

STEPS IN MAKING CASHFLOWS THROUGH REAL ESTATE RENTALS

Are you happy with the pay you receive?

Earning extra-income is one of our foremost priority in making both ends meets. There are times that we as workers have to settle for a measly sum heavily deducted our overtime pay with tax when we are toiling for hours in a dead end job that doesn't pay and compensate you much. It is a good thing if you have extra cash on hand then why not make money work for you through passive income. Better yet to "Work Smarter, Not work harder".

There are certainly many potential streams of passive income where you can sit tight and let it grow. Example of these are investments through stock, mutual funds, time deposits, money market and bank deposit but these streams cannot compensate much in terms of Return of Investment. However these are also ideal and advisable for those who are building up their assets (wealth in general), diversifying through as additional cash flow and live a fruitful retirement during our old age.

Real Estate is still the king wherein it has become advantageous for most people nowadays as the construction of residential and commercial building are sprouting in the skyline of Metro Manila. Thanks to the influx of foreign investment brought about by the strong peso, Business Process Outsource (contact centers) and remittance of our Overseas Filipino Workers (OFW) who have been the lifeline in the Philippines. Demand for properties especially in Makati for BPO is high including residences for foreign expatriates who want to retire as well.

As a real estate professional, I too have mixed feeling of the tall skyscrapers blocking the view of the blue sky of the Metro Manila plus the progress we are experiencing. Hopefully, we are not affected with the U.S. subprime crunch wherein there are too many foreclosures in America. A piece of advise, much better to buy a property now in the U.S. It also becomes a happy notion for me that I can sell a residential condominium and give a satisfied client with a smile on his face on moving-in and living in his own condo unit or house.

Real estate rentals have become a lucrative business for most people. An example of this is Lito, he inherited a property from his parents a 365 square meter bungalow home located in corner street in Cubao, Quezon City built in 1960s. The property is accessible to Aurora Boulevard which is few minutes away and is inside a busy street of Public Utility Jeepneys. Although it is old, he did rehabilitate it a little just to make it presentable to possible clients. In two months time, it attracted a couple working nearby a call center in Libis at a agreed price of PhP 7,000.00 per month on the rent for this three bedroom bungalow property. The place is a bit busy but for the couple it is conveniently close to their workplace so they decided to get it.

Cash came flowing from the start and at the same Lito received the one month deposit and two months advance for the house. Let say, the house is earning PhP 7,000.00 per month multiplied by 12 months it will be earning at net of PhP 84,000.00 annually. Other expenses like taxes, repairs and other unforseen circumtances like unpaid dues etc are not yet included in the computation. Just be ready for anything.

Another example is Ren, he is involved lease-hold and sublease properties wherein he is using another man properties and subleasing it to other people. Here is how it works. Ren finds a property close to a university in the U-Belt. It is a few minutes away from UST and FEU and close to Espana. Let say he finds a property, an old two storey wooden house. Somehow it was rehab by the real owner and is renting it at PhP 6,000 per month. Ren sees an opportunity on this and focused its hind sight on this income earning potential. He grabbed it and asked the owners if he can sublease the property

Better to insure your property with non-life insurance like fire and others if ever you want to recuperate your investment from disasters.

Read the new laws on rental control. I believe the Senate have passed recently a law updating the old rental control law which expired last 2005. Right now, the laws governing the rent control was extended till December 31, 2008.

Residential condominiums are also excellent investment as real estate rentals. You can buy one at a low price during its pre-development stage and when it is ready for occupancy. You can but in the "FOR RENT" sign on the homeowners bulleting board. Right now, the best location to invest are those close to the university and schools wherein parent of students coming from the province need to find a place to live close to school and which is convenient at the same time than living in a dormitory. A colleague of mine owns a condo close to De La Salle University in Taft Ave, Manila. He leases at PhP 18,000 per month and is earning at least PhP 216,000.00 net. It is a cash cow indeed. You'll just have to worry paying the monthly dues for the maintenance. Other utilities will be shouldered by the lessee.

In Rental properties, you see to it that you make an monthly inspection or sometime quarterly inspection on the property. Check for leaks, termites and other problem that your tenants might call your attention to. Always establish rapport with them and even better if you talk to them from time to time.

So if you intend to be a landlord, you therefore will have sufficient passive income for your wealth or asset to grow in terms of money without much exerting physical effort in working for a company.

NEWS: BSP okays low-cost housing loan scheme

BSP okays low-cost housing loan scheme
By Des Ferriols
Monday, February 18, 2008

The Bangko Sentral ng Pilipinas (BSP) has approved a housing loan scheme that would allow low-income borrowers access to micro-financing to build low-cost houses.

The scheme, which also provided incentives for banks and micro-finance institutions, would allow for small loans that borrowers could be paid in frequent but small amounts.

BSP Deputy Governor Nestor Espenilla Jr. told reporters over the weekend that the micro-loan model has been tried and tested among low-income borrowers already used to schemes such as the traditional paluwagan and hulugan models.

“To start with, housing loans already have a very high repayment rate,” Espenilla said. “It’s in the culture of the Filipino to want to own a home and not to lose it.”

According to Espenilla, the scheme approved by the BSP would allow low-income borrowers to access financing from formal financing institutions that they otherwise would not be able to access.

The Housing Microfinance product, Espenilla said, would address the shelter needs of the economically active poor that were currently not being served by financial institutions.

Espenilla explained that the Housing Microfinance product involved the application of microfinance principles and best practices to the provision of housing finance for home improvements, house construction as well as house/lot acquisition.

Espenilla said the home improvement loans have a maximum of P150,000, similar to microfinance loans, while house construction and acquisition may be up to P300,000.

As an incentive to participating financial institutions, Espenilla said the product would be classified as a type of microfinance loan which would enjoy the incentives granted to regular microfinance loans such as no collateral requirements or the acceptance of collateral substitutes, as well as simpler documentary requirements.

“This addresses the usual barriers that the poor face in accessing housing finance,” he said.

Espenilla said the BSP’s Monetary Board has also agreed to allow housing microfinance loans to be considered as alternative compliance to the mandatory credit allocation to agrarian reform and agriculture activities as required by PD 717.

To implement the program, Espenilla said the BSP would enter into a Memorandum of Agreement with the Housing and Urban Development Coordinating Council (HUDCC). He said they would agree on the accreditation criteria and standards that would be applied to the banks offering this product.

According to Espenilla, the specific risk management features have been embedded in the product design. Some of these features include using a cash flow analysis to determine the client’s ability to pay, requiring a good track record as a microfinance client as well as collecting savings.

In addition, due to some features that were slightly different from regular microfinance loans, Espenilla said additional risk mitigants were required for banks that would offer this product.

“One distinct feature is the possible use of secure tenure instruments as collateral substitutes,” he said. ”In the absence of a land title, these legal instruments effectively provide proof of legal use, possession or ownership of a property.”

Although large commercial banks are not expected to be able to engage in housing micro-financing, Espenilla said the BSP expected significant take-up among rural and cooperative banks as well as micro-finance institutions that already exist.

“These institutions already have the capability and expertise in giving out small loans and undertaking the close supervision that it would require,” he said.

“The idea is for low-income but economically active borrowers to be able to secure the loan that they could pay back in small amounts with higher-than-usual frequency,” he said.

Source: Philippine Star - February 18, 2008

A Dream Come true...Free Boracay Trip by SEAIR & Ivan About Town

I have been an avid reader of Ivan Henares blog since 2006 where it features most of the spots in the Philippines that I have never been or heard some of them before. Well it was so exciting to learn through other people's experience on travelling to different places in the Philippines and how I envy Ivan for that. How I wish I can travel faraway to a land I have never been to and experience the same things as what Ivan had gone through.

Getting to Boracay is one of my dreams that I want to fulfill this year. I would love to join this contest. I truly need a well-earned vacation that has a lasting and soothing effect in my stressful life and also a have a slice of the good life after all I have being in this present moment.

Win A SEAIR Ticket to Boracay, click Ivan about Town below!

Cultivating our culture and at same time putting pride on the faces of Filipinos through tourism gives us a happy thought we can brag to other nationalities about our land, our people and what we can share to them. Let's show, feel, hear and taste the Filipino hospitality to them.

Even here in Pampanga, I haven't been to some of the historical spots he mentioned in his blog where I like to visit in the near future. Thus, it expanded my views and knowledge wherein it gave me the sense of pride of being of being a Capampangan and as a Filipino and a nationalist as well.

Field Trip: Pacific Palisades Ermita Condominiums

An ideal investment with lots of income potential for those looking eager to make cashflow through real estate. This is a chance you can fulfill your dream by earning through passive income. Strategically close to everything from schools, businesses and other scenery on the historical area of old Ermita and Malate district in the city of Manila.

A dramatic addition to the Ermita area, the Pacific Palisades is strategically nestled in the hub of Malate. It is a stone's throw away from the many beautiful and famous landmarks of Manila, within a proximity of convenience and accessibility. Truly, enjoy the luxury of time and comfort!

Pacific Palisades offers the power of mobility for both business and leisure. Offices, hotels, universities, churches, medical centers, casinos, the US Embassy, the International airport, and SM Mall of Asia are all within the reach.

Relax and be united with nature at your doorsteps. Be inspired in awe by the famous Manila Bay sunset, stroll along the Bay Walk, visit the historical Rizal Park, the Walled City of Intramuros, Fort Santiago, the Golf Course, Metropolitan Museum, the Cultural Center of the Philippines, the Trade and Exhibit Centers, and other points of interest.

Enjoy a kaleidoscope of lights and sounds experience in the city's exhilarating night life. Malate has the coolest bars and restaurants to unwind in at the end of day.





Location:
Pacific Palisades,
Maria Orosa Street, Ermita, City of Manila, Philippines

Additional Information:
Pacific Palisades BUILDING FACILITIES
- Grand lobby for the condominium with reception counter
- Two passenger elevator
- 24-hour Association's Security
- Provision for two telephone lines for each unit
- Provision for house entry phone system
- MATV & CATV provision for each unit
- Provision for hot and cold water at toilets
- Individual electric and water meters
- Individual mailbox with key
- Automatic fire alarm and sprinkler system
- Overhead water tank and underground cistern for ample water supply
- Stand-by generator for common areas
- Centralized garbage disposal system
- Individual Condominium Title Certificate (CTC)
- Parking slots (optional)

STUDIO UNIT
- Imported laminated flooring
- Ceramic tiles at toilet & bath
- Modular kitchen cabinets
- Provision for exhaust duct for kitchen and toilet
- Provision for window-type air conditioner

For inquiries and details on this property, please contact CRB Benedict F. Baluyut, Licensed Real Estate Broker at 0917-510-0734 or e-mail at bfbaluyut@gmail.com.

NEWS: Angeles City eyed as among the retirement spots in the Philippines

Metro Angeles Chamber of Commerce and Industry, Inc. has recently invited REBAP - Pampanga Chapter representatives on the Central Luzon Retirement Industry Summit which will held inside the Oxford Hotel, Clark Freeport Zone on 21st February 2008.

The Retirement Industry is one of the emerging sectors of the multi-billion dollar Health and Wellness Industry which is among the priority sectors of the national government.

A project of the Central Luzon Retirement Industry Enhancement Team, the briefing aims to provide information to the stakeholders on the Retirement Industry in the Philippines and to present the prospects of the industry in the region. Likewise, it endeavors to involve the participation of the key stakeholders in the preparation of the region’s Retirement Industry Roadmap and Strategic Development Plan.

The Central Luzon Retirement Industry Enhancement Team is composed of key agencies and organizations from both the government and private sectors. The team is chaired by the Philippine Retirement, Incorporated (PRI) and co-chaired by the Department of Trade and Industry-3 (DTI-3) and the Philippine Retirement Authority (PRA).

NEWS: US recession will not affect Philippine real estate

Construction magnate Reghis Romero II yesterday said a possible US recession as a result of its housing market crisis will not likely affect the Philippine real estate industry.

“In the Philippines, the loan to collateral ratio (for housing loans) is very strict so it would not happen, Romero, national president of the Chamber of Real Estate and Builders' Association, who was the guest speaker at the general assembly meeting of CREBA-Negros Chapter in Bacolod, said yesterday.

Romero said Philippine banks also do not use the same mortgages as their US counterparts which experienced sharp rise in home foreclosures.

CREBA has instituted the use of contract-to-sell instead of mortgage origination in documenting installment sales of house-and-lot packages to prevent subprime crisis in the Philippines .

“The advantage of that is the title is not yet under the name of the buyer. If a (homebuyer) fails to pay, then the contract can immediately be reverted back to the bank, and the bank can use or sell it, or securitize it,” Romero said.

Prior to the use of CTS, a deed of sale is issued to a homebuyer even with only 10 to 30 percent downpayment.

Romero said the “pump priming” of the national government through housing projects like the “One Million Homes Program,” aimed to address housing backlog, can also help the real estate industry.

“We have projects that will spur development in the housing sector. CREBA will take the lead in supporting this program, for the Filipinos not to experience the impending American recession,” he said.

HOUSING BACKLOG

Romero said the Philippines has a housing backlog of 4.5 million within 20 years thus, a production rate of at least 500,000 socialized and low-income housing units per year needs to be achieved.

From 2005 to 2010 alone, a total of 200,000 houses per year should have been built, he said.

MODERATE GROWTH

Romero said the country's real estate industry is “in a state of moderate growth and in a process of consolidation from last year, 2007, to 2010.”

“In other words, what we do now or how we fare this year will create an impact on what the industry will become in 2010. This is the time to act, to make the machine grind at a pace higher than it did in the recent past, otherwise, we may lose one good chance,” he added.*NLG

Source: Visayan News Daily (January 25, 2008)

Field Trip: Marquee Place, uniquely Modern Contemporary Design Development in Angeles City

Last February 3, 2008, in celebration of the Lunar New Year. Marquee Place celebrated their first open house for 2008 with a bang during this Chinese New Year - Spring to Life. Most of the soon-to be residents where treated with lunch and snack of assorted Chinese delicacies and meals. People were also treated for a free photo opportunity wearing a Chinese costumes used during the old dynasties of the past. The children on the hand were given mind games for their enjoyment and relaxation in the open house event.

Community Innovations, Inc.'s Marquee Place is an upscale residential development standing on a 35-hectare tract of land, just nearby North Luz0n Expressway toll exit to Angeles City. It is less than 10 minutes from the Clark Freeport and only a few minutes from everything right beside this land is an on-going construction of world class shopping called Marquee Mall (an Ayala Mall).

Marquee Place boasts of a social and sports zone, complete with lap pool, jogging trails, exercise stations and ball court facilities. The entire park is a playground for children and health buffs. At the same time, its serene ambience encourages relaxation and re-generation.

Community Innovation has already introduced two of its newest housing, HUDSON and NIAGARA house wherein they are themed with modern contemporary design of houses in accordance with modern living you can find here in Angeles City.

Property sales have been very brisk, another indicator of the booming local economy. The Pampangos have really got it made even in the midst of hardship brought about by Mt. Pinatubo eruption and other calamities which devastated the province in the past decade.

Pampanga is now rising on its feet, we welcome you to visit or permanently stay in Pampanga for good.

For inquiries, please call me at 0917-510-0734, Tel: (045) 961-5936 or email me at cfbaluyut@yahoo.com.

Field Trip: Andalusia - Communities Philippines newest jewel in Pampanga

COMMUNITIES, the largest and most successful real estate developer (A Vista Land Company), has brought families home. Because for Communities, it has never been about building houses - it's about building homes for your family and for countless others across the nation. As a pioneer Master Planned Community developer in the Philippines, Communities adhere to the development of the upgraded line of residential community projects.

For these reasons, and more, Communities is proud to celebrate six years of building Master Planned Communities where people just like you feel at home.

Andalusia is a master-planned community spanning 8 hectares of prime land along the Mc. Arthur Highway in San Fernando, Pampanga (the former site of ALMA Ice Plant which was wholly owned and operated by the Lagman family). A community proud to be the center of it all-just a short walk away from the school, church, hospital, recreation center and other lifestyle hubs. This “walkable” , “bikeable” community is designed with residents safety and privacy in mind. A commercial is likewise envisioned to transform the community into a self-sufficient, self-sustaining one. The residents’ well-being is assured with the many wellness features that will be incorporated in the development.

Exclusive Features:
•Community Courtyard with Fountain Park
•Tree lined streets
•WI-FI ready
•Security Monitoring System
•Entrance Gate with Guardhouse/24-hour security
•Underground Drainage System