FAQ

If you have short-term money needs, a personal loan can be the answer. With no collateral needed, you can easily apply for a personal loan at any bank in the Philippines. To learn more about the basics of personal loans, we've compiled this FAQ for your convenience.

True to its name, a personal loan is a loan for any personal expense. Unlike a housing loan or a car loan, you can use a personal cash loan for anything you want, be it tuition fees, travel, or anything else.

There are two types of personal loans available: secured and unsecured. A secured personal loan requires collateral, such as a house or car, to back the loan. For unsecured personal loans, you don't need to put up any kind of collateral. Unsecured personal loans are much more common in the Philippines, though secured loans are also available.

When you take out a personal loan in the Philippines, you enter into an agreement with the lender (usually a bank) and promise to repay your loan over an agreed length of time (also known as the loan tenure or loan tenor). If you're taking out a secured loan, you will also need to put up a collateral.

To repay your personal loan, you make monthly payments for the loan tenure until you've fully repaid both the principal of the loan and the interest. During the early years of the loan, the majority of your monthly payments will be used to repay interest, however, as time passes, a larger proportion of your payments will go into paying down the principal.

Rates vary from bank to bank. For example, a Security Bank personal loan has an effective interest rate of 29.48%, while another personal loan has an effective interest rate of 26.62%.

Most personal loans from banks in the Philippines offer attractive interest rates for their personal loans. While standard monthly interest rates are around 1.5% to 2%, you can get lower deals for more specific types of personal loans like OFW loans or personal loan for business expansion. Depending on the specifications of your needs, you avail the lowest rates on personal loans from these banks.

The best bank for your personal loan needs will vary according to your qualification and/or your preference. There are banks who offer low interest rates, but their payment terms may not be as attractive. Meanwhile, you may get a loan with better tenure but a less appealing interest rate. Quick loans from non-traditional lending companies will grant loans with less paperwork but their interest rate may be a lot more than what banks offer. Depending on what you value most, you'll get the best deals for every category from different loan providers.

You can borrow loan amounts as much as ₱2,000,000 when you apply for a personal loan from a bank, though it will still be subject for evaluation and may or may not be approved based on your capacity to pay. Meanwhile, private lenders on the average mostly offer from ₱10,000 to ₱200,000. Private lenders, unlike banks, don't usually have a standard maximum loan amount. However, many of them do base their approved loan amount on the borrower's income.

For your reference, below are the different personal loan providers and the maximum amount of loans they offer.

 

What Is The Best Place To Get A Personal Loan?

There is a type of personal loan for every financial need. To get the most out of what banks and private lending companies have to offer, applying for a specific personal loan that's appropriate for your needs (starting a business, home renovation, etc) and/or branded for your profession (Doctors loan). This will give you more flexibility to pay back the amount you've borrowed.

As a general rule of thumb, you must submit the complete documents required by the bank or loan provider. Even a single missing requirement such as a valid ID or an incomplete form will take out a day or two from the loan application verification, thus delaying the disbursement of your loan further.

Loan Terms

Collateral:
This refers to the asset the borrower pledges to a given lender in order to secure a loan and this will be impounded by the lender in case of default in payment of the loan.

Early settlement penalties:
The fees that the borrower will have to pay in the event that he/she settles the loan at an earlier date from the one specified on the loan agreement. This is usually estimated as a percentage of the initial loan amount.

Guarantor:
This is a person who agrees to be liable for the payment of a loan in the event that the borrower will be unable to pay for it on time.

Late Payment Charges:
This is the fee which the bank will charge you in the event of non-payment of your loan on the agreed time schedule. For example, for SB Finance personal loans, late payments are charged 3% a month.

Loan/Financing Tenure:
This refers to the time period for a certain loan. At the end of the loan tenure, the borrower is supposed to have cleared the loan taken.

 

Frequently Asked Questions – Junrix e-Services

What is a Personal Loan?

A personal loan is an unsecured, no-collateral, multi-purpose cash loan designed to provide financial assistance to qualified employees and business owners.

How much can I borrow?

Loan amounts range from ₱30,000 to ₱3,000,000, depending on credit evaluation results and submitted income documents. Typically, borrowers may receive three to five times their gross monthly income.

How can I apply for a Personal Loan?

Simply click on any of our loan offerings, and a Loan Advisor will assist you shortly. You may also reach us through the contact details provided on our website.

How long does the loan application process take?

Loan applications are typically processed within 3 to 7 banking days, provided all required documents are submitted completely and accurately.

What are the requirements for a Personal Loan application?

For Employed Applicants:

• Completed and signed application form
• Photocopy of company ID with clear photo and signature
• Photocopy of one (1) valid government-issued ID with three specimen signatures
• Latest one (1) month payslips
• Latest BIR Form 2316

For Business Owners:

• Two valid government-issued IDs
• Latest Income Tax Return with BIR Stamp
• Latest Audited Financial Statements
• SEC/DTI Certificate of Business Registration
• Business Permit/Mayor’s Permit
• Latest six (6) months bank statements
• List of three suppliers and three customers with contact details
• Latest General Information Sheet (if Corporation)

Additional documents may be requested by the bank if necessary.

How will I be updated on my loan application status?

A Loan Advisor will keep you informed about your application status. You may also contact us through the details provided on our website.

What is the interest rate?

Interest rates vary depending on the fund provider (banks or financing institutions) and the borrower’s credit profile. Rates typically range from 1.39% to 2.50% add-on rate per month.

How will I receive my loan proceeds?

Once approved, a Loan Advisor will guide you through the process of availing your loan proceeds. Be sure to prepare the original copies of your submitted documents for verification.

How do I repay my loan?

Loan repayments are made via Post-Dated Checks (PDCs). Borrowers must have a personal checking account. If you don’t have one, we can assist you in opening an account before loan disbursement.

Can I apply for a loan if I don’t have a checking account?

Yes, you may proceed with your loan application, and we will assist you in opening a checking account before loan disbursement.

What happens if I miss a payment?

Missing a payment may result in penalties and affect your credit standing. If you anticipate difficulties in making payments, contact your Loan Advisor immediately to discuss possible solutions.

Can I pay off my loan early?

Yes, early repayment options are available. Contact your Loan Advisor to discuss the terms and any applicable fees.