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Bank Letter of Guarantee (for property purchase)

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cian.cpa


Arresto Menor
Good day everyone.

I am currently trying to purchase an "RFO" property. The developer is requiring me to secure a Letter of Guarantee from one of their accredited banks to be able to occupy the property even before i finish the downpayment, which is around 18 months from now.

One of the leading banking institutions have approved my loan already. Assuming they issue the Letter of Guarantee today, my questions are:

1. How long is the usual validity of a letter of guarantee?
2. Am I legally required to take out the loan from the same bank after I have completed the DP?
3. Related to Question #2, my broker told me to just use the letter of guarantee from the bank who would approve my loan the fastest so I can already move-in to the said property and just secure the "ACTUAL LOAN" from the bank who would offer the best deal (lowest interest rate, promos, etc.) before I finish the DP. Is he correct about this? Any thoughts?

Thanks in advance.

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attyLLL


moderator
1) depends on the bank but often 60 days though most allow extension
2) yes, but you can continue shopping with the other banks for better rates or make them bid against each other
3) I wouldn't agree because once you use that Letter guarantee, they will already process the loan


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