Policy rule on loanable amount
- The Circular No. 402 sets guidelines for determining the loanable amount based on (1) capacity to pay and (2) the loan-to-appraised value (LTV) ratio under the Pag-IBIG Fund End-User Home Financing Program.
- The loanable amount must comply with both the capacity-to-pay limit and the LTV ratio limit.
Capacity-to-pay limitation
- The loanable amount shall be limited to an amount such that monthly repayment does not exceed thirty-five percent (35%) of the borrower’s gross monthly income.
- For tacked loans, the individual gross monthly income of at most three (3) borrowers shall be considered.
LTV ratio limitation by housing value band
- The loan-to-appraised value (LTV) ratio is the ratio of the loan amount to the appraised value of the collateral.
- The LTV ratio shall not exceed the following thresholds:
- Up to the Economic Housing Limit: 95%
- Over the Economic Housing Limit up to P6,000,000: 90%
- For developer-assisted housing loans where developer’s License to Sell is for a socialized housing project and the loan purpose is for the purchase of a residential unit, the LTV ratio shall be 100% for developer-assisted housing loans up to the prevailing maximum limit for socialized housing loan.
Repeal, continued effect, and implementation mechanics
- Circular No. 402 repeals Item Nos. 4.1.2 and 4.2.1 of Pag-IBIG Fund Circular No. 396, also known as the Modified Guidelines on the Pag-IBIG Fund End-User Home Financing Program.
- All other terms and conditions in Pag-IBIG Fund Circular No. 396 that are consistent with the Circular No. 402 provisions remain in full force and effect.
Effectivity and publication timing
- Circular No. 402 takes effect fifteen (15) calendar days after publication is completed in either the Official Gazette or a newspaper of general circulation.
- The effectivity rule is triggered upon completion of publication, followed by the 15-day calendar period.