Question & AnswerQ&A (BATAS PAMBANSA BLG. 400)
The guidelines cover all retail and developer-assisted housing loan applications for the Pag-IBIG Fund Affordable Housing Program (AHP) received by the Fund upon its effectivity.
The loan proceeds may be used for the purchase of fully developed residential lots, residential house and lots, townhouses or condominium units (old or new), construction or completion of a residential unit, home improvement, or refinancing an existing housing loan subject to timely payments.
An eligible applicant must be an active member of the Pag-IBIG I Membership Program with at least 24 monthly savings or an equivalent lump sum, have a gross monthly income not exceeding P17,500, be not more than 65 years old at application and 70 at maturity, have legal capacity to acquire real property, pass credit checks, have an updated Pag-IBIG housing account if applicable, have no arrears in Pag-IBIG Short-Term Loans, and have no prior housing account which was foreclosed, cancelled, or subjected to dacion en pago.
The maximum loanable amount is up to Seven Hundred Fifty Thousand Pesos (P750,000), which is based on the lowest of actual need, desired amount, capacity to pay, and loan-to-appraised value ratio.
The maximum loanable amount depends on the income cluster: Cluster 1 (NCR) borrowers can have up to P17,500 income with a loan up to P750,000; Cluster 2 (Regions) borrowers up to P14,000 income with loans accordingly. The housing loan shall not exceed the income cluster limit or the socialized housing loan ceiling.
A tacked loan involves up to three qualified members who apply jointly; if related within the second civil degree, combined income is considered; if not related or beyond second degree, the property must be registered in all names, all must sign the REM, and the mortgage is released only upon full payment. Co-borrowers are jointly liable.
Borrowers earning up to P15,000 (Cluster 1) or P12,000 (Cluster 2) with loan amounts up to the socialized loan ceiling pay 3% interest for five years. Borrowers earning up to P17,500 (Cluster 1) or P14,000 (Cluster 2) with loan amounts up to P750,000 pay 6.5% interest for ten years, after which rates are repriced.
The maximum loan term is 30 years but cannot extend beyond the borrower's 70th birthday. Monthly amortization must cover principal, interest, and insurance premiums and is ideally paid through salary deduction or other authorized modes.
Late payment incurs a daily penalty of 1/20 of 1% of the unpaid amount. Default occurs after missing three monthly amortizations or failing to comply with obligations, leading to immediate demand for full payment, cancellation or foreclosure of property, and ineligibility for new housing accounts until fully updated.
A First Real Estate Mortgage (REM) on the subject property fully covering the loan accompanied by an Original Certificate of Title or Condominium Certificate of Title registered in the borrower's or accommodation mortgagor's name is required. Accommodation mortgages are allowed only between close relatives up to the second civil degree.