In response to the demands of its members, the Home Development Mutual Fund, otherwise known as the Pag-IBIG Fund, has extended its Good Payor Incentive Program until May 31, 2009 for housing loan borrowers whose accounts were taken out before November 23, 2006.
Pag-IBIG president Romeo Quimbo, in an order, said that housing loan borrowers with updated accounts, and with interest higher than six percent, are given a maximum discount of two percent on the interest applicable for the month. The discounted amount shall be applied directly to the principal.
In effect, the member-borrower’s original loan term will be shortened.
All housing loan packages now have a maximum term of 30 years. Under the old guidelines, loans over P750,000 up to P2 million had a maximum payment period of only 20 years.
“This aims to provide better access to housing loans for employees who cannot afford to borrow from banks with their current income,” Quimbo explained.
He also instructed the Fund to continue the implementation of its Housing Loan Restructuring and Penalty Condonation Program to enable member-borrowers to settle their delinquent accounts.
Since its implementation last June 2007, P10.979 million in discount was granted to the 7,082 housing loan borrowers whose accounts are updated in Pag-IBIG Fund Cagayan de Oro Branch.
During the implementation of the program, the borrower’s discount privilege for succeeding amortization will be revoked once she/he fails to pay his/her monthly payments for three consecutive months.
In November 2006, the Pag-IBIG Fund reduced its interest rate from nine to only six percent per annum for a P300,000 housing loan while the rate for P500,000 loan went down to seven percent from 10 percent.
Under the new rates, the monthly amortization amounts to P1,798.65 for loans worth P300,000 and P3,326.51 for loans worth P500,000. —Jasmin R. Uy/MEEV