IRR for Loans in High Density Housing Program

Site Development: Improvements to project site including roads, drainage, sewerage, water, and electrical systems.
Building Construction: Process of constructing shelter infrastructure.
Performance Security: Guarantee by developer/contractor to complete the project according to approved plans and specifications.
Retention Fee: 10% of contract price withheld from payment to cover defective works.

Community associations must be registered landowners or have usufructuary arrangements or prior lot acquisition loans under HDH.
Must comply with requirements for building construction and/or site development loans.

Maximum loanable amount per informal settler family (ISF) is ₱450,000 inclusive of land acquisition, construction and site development.
Loan amount determined by the lowest of: sum of member-beneficiaries' entitlement, project cost, or appraised property value.

Community association must notify SHFC before construction about chosen tenurial arrangement (usufruct, condominium title, or similar).

SHFC conducts due diligence on selected contractors/developers reviewing financial stability, managerial capability, technical expertise, and experience.
Community association must submit report on contractor/developer selection process.
Criteria include PCAB licenses, and membership in real estate and developer associations.
Multiple contractors allowed for large projects (≥500 units) with same assessment requirements.

Management endorses project for Board approval after reviewing contractors and submitted documents.
Mobilization fund of 15% granted upon Notice to Proceed.
Loan releases thereafter are made in up to four tranches based on progress billing aligned with approved work schedule.
Required submission for each release includes Statement of Work Accomplishment, photos, billing, and completed work certificates.
SHFC verifies collateral value before disbursing each drawdown.

Loan secured by Real Estate Mortgage annotated on the community association's land title.

Developer/contractor must certify conformity of plans and works with applicable laws and local ordinances.
SHFC not liable for deviations made after certification.

Performance security in form of surety bond equal to 10% of contract price required from contractor/developer.
Release of bond within 15 days after project completion subject to satisfactory validation.

SHFC retains 10% of contract price as retention fee for repairs of defective work.
Fee released within 6 months after project completion and board resolution confirming acceptance of repairs.

Member-beneficiaries start amortization payments two months after issuance of Certificate of Completion and Acceptance by community association.

Mortgage Redemption Insurance (MRI): First-year premium paid upfront; subsequent premiums included in monthly amortization.
Fire and Allied Perils Insurance (FAPI): Covers house and improvements; premium payment structured as per MRI.

Detailed checklist for site development and building construction loan application attached.

Due diligence on registrations, permits, licenses, and certifications.
Evaluation of company profile, key personnel, ongoing and completed projects.
Verification of organizational structure, equipment, suppliers.
Review of financial capacity including audited statements, tax returns, and tax clearances.

Technical: Detailed architectural and engineering plans, cost estimates, permits, certifications, and reports.
Contractor/Developer Eligibility: Incorporation papers, permits, licenses, financial statements, tax compliance.
Legal/Mortgage Examination: Contracts, loan agreements, assignments, promissory notes, identification, and title documents.

All technical plans must be signed and sealed by licensed professionals and approved by relevant authorities.