OFW Loans 101: How and what you need to get a
loan
FEBRUARY
04, 2016
Are you planning on getting an OFW or Seaman loan from a lending
company for the first time? If you want to know the process and requirements
you should be bringing with you, then you certainly have come to the right
place. After numerous visits to different lending companies and interviews with
OFWs and Seaman that went through the whole process of borrowing money, we are
pleased to share the information that we have gathered with you.
The process of applying in every lending company involves 3 major steps.
1. Inquiry and Application
For this step, you (the borrower) will call or
visit the branch of the lending company. You will ask the lending company
regarding the details on getting a loan such as the documents you need to
submit, the interest and fees that they charge, and the estimated monthly
payment given the loan term. The documents that all lending companies ask for are
found below. Do take note that there are lending companies that ask for more
documents so check our
-Valid ID
-Airplane Ticket
-Passport
-Overseas Employment Certificate
-Working Visa
-Proof of Billing
-Employment
Contract
-Co-maker*
*documents of co-maker vary depending on the
lending company
If you have all these requirements ready with
you, you may now visit the lending company to apply. You will be asked to
submit these documents to the loan officer. After submitting, you have finished
step 1!
2. Credit Investigation
The second step won’t involve you for the most
part, unless there are some additional findings from the credit investigation.
During this step, lending companies will verify information that you have
submitted including your employment status, your departure date, the validity
of your documents, your home address and many more. If you are hiding anything
from these companies, most likely they will figure this out and have a negative
effect on your application. Because of this, it is best to inform them from the
start regarding any potential problems.
The credit investigation process usually takes a day to be completed, so just wait for a call from the company regarding the decision on your application.
3. Loan Release
The third and last step of the process is the
disbursal step. This is the time when you will get your loan and sign
promissory notes with the company. Common practice of lending companies is to
only disburse the loan 5-7 days before your departure. (If you have urgent
needs and your departure date is not anytime soon, we suggest that you find
other ways and not go to lending companies to save time.)
On disbursement day, you will be asked to sign post-dated checks for each of your payments. In the event that you do not have a checking account, the lending company will endorse you to a partner bank to open one. (View our
features comparison page to see how much each company will charge you for maintaining the minimum balance). You will also be signing your promissory note on this day as well as the disclosure statement which shows you all the interests and fees. Take note that some companies have hidden charges which they deduct to your loan amount that they did not tell you about, and these charges will be seen on the disclosure statement.
Once you have signed all the contracts and post-dated checks, the company will give you the loan either in cash or check. For the repayment of your loan, you have to fund the checking account that you have opened on or before your due date as they will deposit the check on that day. One tip is that if you have problems with your payment, it is best to contact the lending company ahead of time to avoid a lot of penalties.
