money to invest in a first condo

You’ve thought about it long and hard, weighed the pros and cons, and went over the list of things to consider before making your decision. Now, you can say with absolute confidence that you’re ready to take the big step and invest in your first condo.

You already know what location and project you want to invest in, you’ve prepared the reservation fee and down payment, and you’re just about set to sign the contract-to-sell (CTS) with your developer.

That’s great and all, but what comes next?

Because you know it’s not as simple as just waiting until turnover — and you’re right. Let’s talk about the next steps you should take to make the buying process easier for you.

Step 1: Start working on your bank requirements

You’re prepared to pay your condo’s down payment over the course of 12, 24, or 36 months, but you have to take out a loan to pay off the remaining balance. Most developers will recommend going for bank financing, as interest rates are lower.

Talk to your bank or check out their website to know what requirements you’ll need to submit to get approved for a loan. Building a good relationship with your bank can help.

Get a preapproved loan if you can.

Step 2: Process the Transfer of Title

Your condo title is proof of your ownership, so it’s important that you get this transferred to your name.

In some cases, the developer will process the transfer of title on your behalf. But others will have you process the transfer. Here’s how you can do it:

One of the first things you should ask for is the Deed of Absolute Sale (DOAS), which will state that the seller has agreed to transfer ownership of the property to the buyer. The DOAS should be notarized before a Notary Public.

You will then need to pay the corresponding taxes at the Bureau of Internal Revenue (BIR). Ensure you have the certified true copy of the title, latest tax declaration, and original DOAS. The BIR assessment of the property, and the seller will pay the Capital Gain Tax (CGT), which is 6% of the purchase sale or zonal value, whichever is higher.

You’ll also need to pay the Documentary Stamp Tax (DST), which is 1.5% of the purchase sale or zonal value, whichever is higher. After paying the corresponding taxes, the BIR will issue a Certificate Authorizing Registration (CAR) for the subject property.

It should be noted that, aside from the taxes, you’ll also need to pay the transfer tax in the city or municipality where your property is located. This can range from 0.0075% to 1% of the property value. Once paid, the city or municipality will issue an official receipt of payment of transfer tax and a tax clearance certificate.

Finally, you can head over to the Register of Deeds. As the buyer, you’ll submit the original owner’s duplicate copy of title, original deed of sale, certified true copy of latest tax declaration, and the original copy of your CAR. You’ll also need to pay the corresponding registration fee for the issuance of the title to your name.

Step 3: Check your other documents

Unless your developer’s doing the transfer of title for you, you might already be feeling overwhelmed by this point — and it’s normal to feel that way.

As you already know, owning property is a big responsibility and commitment that you shouldn’t take lightly. But we’re almost there!

Once you’ve taken care of your condo’s title, be sure to double and even triple-check your other documents — like your real estate property taxes. This should be updated prior to the turnover of your condo unit. In most cases, the developer will shoulder your property taxes until turnover, but make sure to check with them.

Step 4: Prepare for the turnover costs

Before your condo unit is turned over to you, there are some expenses that you need to clear up first — and this can vary per developer.

Here are some of the common costs new homeowners incur prior to turnover and move-in:

Not included here are, of course, the renovation costs in case you want to make home improvements before you move into your new condo.

Step 5: Inspect your unit

Just because you’re buying from a reputable developer doesn’t mean you shouldn’t do a thorough check of your new home. Your developer will also insist that you do an inspection of your condo unit, usually before you’re handed the keys.

Conducting an inspection will protect you from incurring any additional costs in the event that there are damages to your unit.

Check the faucets for any leaks, your windows if they open and close properly, the ceilings for any signs of water damage, and your walls for any cracks. Bring these to your developer’s attention so they can address them before officially turning over your condo.

Unsure where you are? We’ve got you covered.

The process of buying a condo isn’t as simple as signing a few pieces of paper, but that’s where your DMCI Homes Property Advisor comes in. As real estate professionals, they can answer all your questions, give you sound advice, and guide you in what you need to do from start to finish.

Don’t hesitate to reach out to your DMCI Homes Property Advisor. After all, we’re always happy and ready to help!

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