Question & AnswerQ&A (Republic Act No. 5488)
The Home Financing Commission is composed of five members appointed by the President with the consent of the Commission on Appointments. The President designates one member as Chairman who receives an annual compensation of twenty thousand pesos. Two members must be officers or directors of non-governmental mortgage institutions participating in the insured mortgage program.
The Chairman holds office for five years. Members also hold office for five years, except the first appointees who serve staggered terms of one, two, three, and four years respectively. Successors serve full five-year terms.
Any person directly or indirectly interested in construction companies, firms dealing in building materials, real estate development companies, or financial institutions transacting with the Commission is disqualified, except for the two members from non-governmental mortgage institutions participating in the insured mortgage program.
The mortgage principal obligation shall not exceed thirty thousand pesos per family unit including house and land, nor exceed ninety-five percent of the appraised value of the property.
Banking institutions, trust companies, personal finance companies, mortgage companies, building and loan associations, savings and loan associations, installment lending companies, insurance companies, Government Service Insurance System, Social Security System, the Development Bank of the Philippines, and other government financial institutions.
(1) Loans for repair, alteration, or improvement of an existing structure up to ten thousand pesos, maturing up to ten years; (2) Loans for alteration, repair, improvement or conversion of a dwelling for two or more families up to twenty thousand pesos, maturing up to twenty years.
The mortgagee must promptly convey rights to the property and assign claims against the mortgagor to the Commission. The mortgagee stops paying insurance premiums, and the Commission may pay in cash or issue debentures equaling the outstanding mortgage balance.
It means a first mortgage on real estate in fee simple or on a lessor's or lessee's interest under a lease of at least forty years from the mortgage execution date, where residential buildings are located or to be constructed. It includes first liens commonly given to secure advances or unpaid purchase price of real estate.