Policy Framework
- Emphasizes government policy to establish a financial support system encouraging private sector participation in social housing.
- Focus on equity by distributing affordable housing across regions.
Creation and Scope of the Fund
- The Fund is established with an initial capitalization of P2.5 billion, appropriated over five years (P500 million/year).
- Exclusively for enhancing housing affordability, project financing, and risk elimination for funding agencies (SSS, GSIS, HDMF).
- The Fund provides three core services: amortization support, developmental financing for low-cost housing projects, and cashflow guarantees for loans.
- Augmented by foreign grants and concessional loans with extended maturities and soft interest.
Amortization Support System
- Eligibility Criteria:
- Gross monthly family income limits (Level A: ≤P4,000; Level B: ≤P5,000).
- No prior housing loan or ownership in the last 5 years.
- No habitual delinquency or moral turpitude convictions.
- Support Levels:
- Level A borrowers receive a decreasing percentage of monthly amortization support over 5 years, starting at 35% down to 14%.
- Level B borrowers have a different schedule starting at 25% support, gradually decreasing.
- Loans must only include minimum processing fees, insurance premiums without other charges.
- Provisions for waiver or liberalization if the property is lost or damaged due to force majeure.
- Amortization support prioritizes Level A borrowers with at least 60% of funds.
- At least 40% of yearly appropriations are dedicated to amortization support.
Developmental Financing
- Provides loans up to 80% of project cost for low-cost housing projects priced ≤P60,000 per unit for Level A borrowers.
- Allotment: 15-20% of yearly appropriations.
- Unused amounts revert to amortization support for Level A.
Cashflow Guarantee System
- Guarantees loans up to P150,000 at interest rates not exceeding 12% per annum.
- Loans assigned to the Fund with promissory notes guaranteed by the Republic.
- Allocated 40% of yearly appropriation.
Corporate Powers and Administrative Authority
- NHMFC manages amortization support and developmental financing; acts as trustee.
- HIGC manages cashflow guarantees; acts as trustee.
- Both agencies empowered to:
- Formulate policies, adopt rules/regulations.
- Submit annual reports and budget proposals.
- Acquire, utilize, and dispose of property.
- Maintain accounting, actuarial, and statistical systems.
- Enter contracts, invest, and form subsidiaries.
- Sue and be sued.
Management Responsibilities
- NHMFC and HIGC powers include:
- Policy formulation and publication.
- Operational direction and budget adoption.
- Personnel appointment approval.
- Other duties to implement the Fund effectively.
Investment Guidelines
- Excess funds to be invested in government securities or deposited in government banks to ensure liquidity, safety, and growth.
Administrative Costs and Appropriations
- Administration cost capped at 1% of net Fund assets yearly.
- Organizing and initial operation expenses advanced by administering agencies with reimbursement.
- Appropriations released quarterly in equal installments.
- Fund appropriations included in the General Appropriations Bill following Act approval.
Audit and Reporting Requirements
- Commission on Audit chairperson is auditor of the Fund; can delegate personnel.
- Administering agencies must submit:
- Annual detailed reports covering operations and recommendations.
- Quarterly reports to Congress with performance data and beneficiary lists.
Supervision and Compliance
- Fund administration subject to supervision and verification by government agencies as designated by the President or Congress.
Repealing Clause and Effectivity
- Conflicting laws, decrees, executive orders, or regulations repealed or modified accordingly.
- The Act took effect upon approval and publication in two national newspapers.