Mortgage quote in Philippines: 8.36% fixed for 3 years - am I overthinking this? [warehouse]

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ink.early

Homeowner
The 8.36% rate fixed for three years is the number driving my decision, but it does not tell me which Manila warehouse loan is cheaper. The purchase is around PHP 65,830,000, and the two illustrations use different loan-to-value assumptions and charges, so the quote with the better headline can still require more cash.

Should I compare each option by the money paid through month 36 plus the balance then outstanding, rather than relying mainly on APR? I also need to weigh the monthly payment against arrangement fees, repayment restrictions and whether portability would work in practice. A lower three-year cost is less attractive if the reset is difficult to afford or refinancing at that point carries another large charge.
 
For a three-year decision, I’d compare total cash paid over those three years plus the loan balance remaining at the end. Include arrangement fees, valuation or other lender charges shown in each illustration, and note whether any fee is paid upfront or added to the loan. APR alone can obscure the comparison if the illustrations use different terms.
 
What loan amount and amortization period did each lender assume? The PHP 65,830,000 purchase price is not enough to compare them if the loan-to-value ratios differ. One offer could have a lower headline rate but require substantially more cash at closing. I’d first make both illustrations use the same down payment, term and payment timing.
 
I would not automatically choose the lowest three-year cash cost. The warehouse still needs to be affordable if the rate resets upward after the fixed period. Run the monthly payment at 8.36%, then at a few higher rates, without assuming refinancing will definitely be available. That stress test may matter more than a modest fee difference.
 
Portability would be fairly low on my list unless you already think the warehouse may be sold and replaced during the fixed period. Early repayment is more relevant: ask each lender for the actual charge structure during all three years and whether partial prepayments are treated differently from full repayment.
 
I partly disagree with putting portability aside. With a commercial property, plans can change, and a feature that avoids ending the loan early may have value. But the wording matters more than the label—does the facility transfer automatically, or would any replacement property and borrower finances be assessed again? I would not assign it a peso value until that is clear.
 
That’s fair. I wasn’t saying portability has no value, only that it should not outweigh a clear repayment restriction without knowing whether the lender would permit the transfer in practice. Noor should ask both lenders the same written scenario: sale in year two, replacement warehouse, partial prepayment, and complete payoff.
 
Month 36 is the useful checkpoint. Put both loans on the same assumed balance, amortisation term and drawdown date, then record the payment split and every fee through the fixed period.

Compare closing cash, cumulative payments and the remaining principal at that point. After that, branch the calculation: keep the loan at its reset rate, refinance and pay new charges, or sell earlier under the repayment terms. Add a separate year-two sale and replacement-warehouse scenario so the claimed portability can be tested rather than treated as an automatic benefit.
 
Also separate property affordability from loan pricing. For a warehouse, the payment still has to be covered during vacancy, repairs or uneven business cash flow. Even if 8.36% is the better quote, it may not be the comfortable quote. How much room is there between the proposed monthly payment and the amount available for debt service?
 
Check whether the arrangement fee itself is being financed. If it is, compare both the fee and the interest charged on it; if it is upfront, include it in closing cash. That small presentation difference can make two illustrations appear closer than they are. I’d also request identical figures from each lender as of the same proposed drawdown date.
 
After the spreadsheet comparison, I’d choose based on the outcome you can least tolerate. If that is a payment shock, favour the safer reset or refinancing position. If it is selling early, focus on repayment and transfer terms. The 8.36% rate cannot be judged by itself; the useful answer is the three-year cash cost, remaining balance and downside under the same assumptions.
 
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