BSP: Approval process for home loan can be quick

Business

THE approval process for the Bank South Pacific’s First Home Ownership Scheme (FHOS) can be as quick as 48 hours, says chief executive officer Robin Fleming.
However, Fleming said it depended on the level of information being provided by the applicant when applying for the loan.
“If they have all the necessary information, the loan approval process is straightforward,” Fleming told The National yesterday
“As the FHOS loan product is designed for new houses and a maximum loan amount of K400,000, the delays in moving into a new home is generally not because of the loan approval process but due to the overall building process and obtaining the necessary building permits at various stages of construction, this can often take six to nine months.
“Based on a loan of K400,000 over 40 years at an interest rate of four per cent per annum, the monthly loan repayments for a FHOS loan would be K1,672 per month.”
Fleming said the requirements were outlined on the BSP website www.bsp.com.pg/Personal/Retail-Banking/Loans/Home-Loans/ which customers were encouraged to check.
He said potential borrowers could contact BSP’s call centre staff on 320 1212 or 7030 1212 to obtain details of the requirements.
“A potential borrower therefore, needs to be earning sufficient salary to meet these loan repayments as well as meeting their other general living expenses,” he said.
“Loans can be in joint names so the income of both applicants can be taken into account.
“If a potential borrower were to save this amount each month, it would take them about 24 months to accumulate their required equity portion of 10 per cent (K40,000) towards the loan.
“In reality however, most borrowers raise their 10 per cent equity through a mix of their personal savings and from their superannuation contributions that they have accumulated.”
Fleming said since the implementation of the FHOS loan product, BSP had funded 790 housing loans.
“The demand for loans under this product remains very strong,” he said.

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