Question & AnswerQ&A (SHFC CORPORATE CIRCULAR CMP NO. 14-031, S. OF 2014)
The Site Development Loan aims to finance improvements such as roads, drainage or sewerage systems, water systems, electrical connections, and reblocking as the second stage of loan assistance under the CMP.
It may be used for house construction or completion of a residential unit on a lot owned by the member, and home improvement which enhances the durability and material value of an existing residential unit.
Community Associations (CA) which are registered owners or have valid lease agreements, usufruct, or equivalent contractual arrangements with terms aligned to the SHFC loan period are eligible, provided they comply with requirements and have a collection efficiency rating of at least 80% if they have existing lot acquisition loans.
Maximum loan entitlement is ₱30,000 for Site Development and ₱120,000 for House Construction, with a total of ₱150,000 per beneficiary. The total including land acquisition should not exceed ₱250,000.
The loan amount is based on the lowest of these three: the maximum loan entitlement per beneficiary, the submitted project cost, or the SHFC-TSD estimated cost for site development or housing unit.
Loans bear an interest rate of 6% per year on the outstanding balance and have a maximum repayment period of 25 years or the remaining term of the lot acquisition loan.
Yes, SHFC must assess contractors/developers hired by the community association as part of due diligence and in accordance with Section 8 of Corporate Circular HDH No. 14-002.
Payment starts upon full release of the loan proceeds or after one year from loan approval if the loan is not fully released within that period, whichever comes first.
The land acquired by the Community Association serves as collateral as per Section 3 (3.7) of Corporate Circular No. 11-017 Series 2011, and the landowner must have legal capacity to mortgage the property.
Members must be covered by Mortgage Redemption Insurance (MRI) for site development loans and Fire and Allied Perils Insurance (FAPI) for house construction loans, with premiums paid as part of the loan amortization.