More Philippine Money Answers
Yesterday I published one of my regular Question and answers columns regarding a number of issues about getting money to the Philippines, managing your money while you live in the Philippines as well as getting your bills paid in the Philippines.
I left out a short section I should have included regarding money transfer services,and a couple other news items and questions have come up since yesterday, so here are a few updates:
Money Transfer Services: These are businesses set up in the USA and a number of other countries mainly to allow OFW’s (Overseas Filipino Workers) to send money back home. But there’s no reason anyone else can’t make good use of them, and they do provide a helpful means of moving money. There are a number of them you will see often, Xoom is oneof the larger ones, I personally recommend an outfit I have used for years now known as Remit Home. (not to be confused with “Remit 2 Home”, one of their competitors).
These folks are located in California and are licensed by all 50 US states as well as the government of the Philippines to move money, easily and quickly for a fee. Their fees are much less than wire transfers from bank to bank, but tyically more expensive thna getting money via a debit card.
To use one, you set up a US source … a bank account or a credit card (if you source via a credit card each transaction will be a cash advance, so be very careful about fees you credit card company may charge) and to ‘enroll’ a destination in the Philippines. This can be a person with an address … for having money delivered to the door, a cash collection counter, available in many shopping malls and even some banks or your own Philippine bank account. One time fees for up to $1,000 USD are about $10 USD. If you set up recurring transfers there are discounts. I find these guys very useful and reliable, the money comes out of my US account via a standard ACH (Automated Clearing House) debit and shows up immediately in my local BDO (Banco de Oro) account … all easily monitored online.
There si, of course, the old standby, Western Union. They provide similar services, have a n offcie on what seems ike every other street corner in the Philippines and move the money in seconds. They do, however, charge like a wounded bull for this convenience … their cheapest rate from the US is about $19 per transaction and it ramps up steeply as the amount transferred increases. But for an emergency there is no faster, more reliable, 24/7 means and no greater availability here.
Cost of Money: Although I see it changing rapidly … I don’t get any more ‘zero percent balance transfer’ offers now, seems like the offers are now 2% or more, the US still enjoys, by far, the world’s cheapest lending rates. Now if there’s a connection between that and so many banks going belly-up, I’ll leave it for someone smarter to decide.
But my point is this, if you are thinking about using credit much here in the Philippines you might want to think a little harder. Friend Bob just published a good article on this expensive money. Apparently the loans there in Davao City are a bit more restrictive than here in the near Metro-Manila area … here’s a page will a lot of loan information from a bank I trust, but when I say it’s a little cheaper here, I’m only talking about a percentage point or two.
Don’t expect home loans much below 12%, and that is with 20% cash down. Don’t expect terms longer than 20 years. And, this is one that will really wake up my fellow dual citizens (US citizen and Senior citizen ;-)), don’t expect to get a loan if you are over 60. Some lenders won’t loan unless the borrower will be under 60 at the time the loan is paid off!
Bob referenced his own article called “Cash is King” as well, and I find nothig at all to disagree with … this is not a country for borrowing money. Bring cash, or, if possible, source you loan back home … it will not be cheaper to borrow money in the Philippines.
Related posts:
- When You Need Money Just Write Yourself A Check
- How Much Do Credit cards Really Cost To Use?
- Questions, Questions, Questions 6
- I Repeat, You Don’t Need a “Job” to Make Money in the Philippines
- Just a Typical Philippine Trip to the Mall
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