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Financing Intermediate

Bank Mortgage vs Pag-IBIG: Which is Right for You?

Compare interest rates, loan terms, processing time, and eligibility between commercial banks and Pag-IBIG.

9 min read
Filipino Rentals Editorial

In this guide

  1. Interest rates
  2. Loan amounts and terms
  3. Processing time
  4. Which to choose?

Interest rates

Pag-IBIG offers subsidized rates starting at 6.25% for low-income borrowers. Banks typically charge 6.5%–8.5% with periodic repricing. Banks may offer promotional fixed rates for the first 1–5 years.

Loan amounts and terms

Pag-IBIG caps at ₱6M with terms up to 30 years. Banks have higher caps (₱20M+) and similar 20–30 year terms. Banks generally require larger down payments (20–30%) compared to Pag-IBIG (10–20%).

Processing time

Banks usually approve in 7–14 days; Pag-IBIG takes 17–25 working days. If you need to close quickly, banks have a clear advantage.

Which to choose?

Choose Pag-IBIG for lower rates and lighter requirements if you qualify. Choose a bank for faster processing, larger loan amounts, or more flexible terms. You can also combine both.

Quick Tips

  • Compare effective interest rate, not just headline rates.
  • Watch for hidden fees like MRI, fire insurance, and processing charges.
  • Get pre-approval from multiple banks to compare offers.

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