NHMFC securitizing P6-B housing loans

After successfully disposing about 25 percent of its real estate mortgage portfolio consisting of non-performing housing loans (NPLs), the National Home Mortgage Finance Corp. (NHMFC) plans up to P6-billion worth of its "good-performing" NPLs to generate fresh funds.

The housing agency also plans to settle part of its existing loan obligations with the Social Security System (SSS) and the Home Development Mutual Fund (or Pag-IBIG Fund).

"Following the discontinuance of its UHLP window and with the recent disposition of its non-performing loans, NHMFC has started the process of its transformation into a secondary mortgage market institution of the government, " newly-appointed NHMFC president Joseph Peter S. Sison said during the recent formal turnover to the SSS and Pag-IBIG Fund of their respective shares in the sale of highly-delinquent mortgages, amounting to P3.3 billion and P400 million, respectively.

Some 55,000 real estate mortgage accounts, with outstanding principal balance of some P13 billion, were sold by NHMFC through open competitive bidding in May last year.

The mortgages represent housing loans earlier granted by NHMFC to SSS and Pag-IBIG Fund members, using wholesale funds lent by the two funding agencies to NHMFC under the latter’s erstwhile Unified Home Lending Program (UHLP).

Since 2003, NHMFC’s outstanding obligations amounted to P42 billion with SSS and Pag-IBIG Fund.

Sison insists that the agency regained its institutional credibility in the capital market, and that "the securitization of NHMFC’s good performing mortgages becomes a logical step for the agency to take in assuming its role as a secondary mortgage market institution."

Meanwhile, the newly-operationalized Social Housing Finance Corp. (SHFC) expressed optimism in its social housing programs this year.

SNFC president Fermin T. Arzaga said the lead government agency will undertake social housing programs that will cater to the formal and informal sectors in the low-income bracket.

"SHFC’s creation, through Executive Order (EO) 272 issued last Jan. 20, 2004, and its operationalization last Oct. 2005, is a milestone event in the social housing and poverty-alleviation programs" Arzaga said. "The organization of SHFC caps the pro-poor housing gains earlier achieved under the landmark housing legislations for the homeless underprivileged, namely R.A. 6846, the "Social Housing Support Fund Act of 1990;" R.A. 7279, the "Urban Development and Housing Act of 1992; and R. A. 7835, the "Comprehensive and Integrated Shelter Finance Act of 1994."