One of the essential needs for a person to live is a home to stay in. However, it is a sad truth that not everyone can afford to have a decent home. Good thing the government provides a chance for everyone to have a house of their own through Pag-IBIG Fund at a more affordable rate, as compared to the rates offered by real estate developers and banks.

So, who are the eligible ones that can avail of the Housing Loan program offered by the Pag-IBIG Fund?

A member should:

  • have remitted 24 monthly contributions under Pag-IBIG I, Pag-IBIG II or Pag-IBIG Overseas Program (Members with less than the required number of contributions will be allowed to make a lump sum payment provided they have been contributing members of the Fund for at least 12 months)
  • Not more than 65 years old at the date of loan application and not more than 70 years old at loan maturity
  • Has no outstanding Pag-IBIG housing loan, either as a principal borrower or co-borrower
  • Has no outstanding Pag-IBIG multi-purpose loan in arrears
  • Had no Pag-IBIG housing loan that was foreclosed, cancelled or bought back due to default or subjected to dacion en pago, which includes cases where the borrower is no longer interested to pursue the loan and surrenders the property; and
  • Has passed satisfactory checks (background, credit and employment) of the Pag-IBIG Fund.

How much can you borrow from Pag-IBIG Fund?

The Pag-IBIG Fund allows its members to borrow a maximum amount of P6 million, with interest rates varying from 6.3% to 10%. The loanable amount depends on the member’s capacity to pay. If you want to know how much you can borrow based on your income and preferred repayment and fixing periods, you can check out Pag-IBIG’s housing loan affordability calculator.

For what purposes can the loaned amount be used?

The Pag-IBIG housing loan can be used to finance not just a house and lot, townhouse or condominium but it can also be used to construct your desired home improvements.

  • Purchase of Lot or House and Lot

– Purchase of a fully developed residential lot or adjoining lots not exceeding 1,000 square meters;

– Purchase of a residential house and lot, townhouse or condominium unit, inclusive of a parking space (may be old or brand new, a property mortgaged with the Pag-IBIG Fund or an acquired asset);

  • Home Improvement

– Construction or completion of a residential unit on a lot owned by the member;

– Home improvement (any alteration in an existing residential unit intended to be a permanent integral part which will enhance the home’s durability and material value);

  • Refinancing

– Refinancing of an existing mortgage with an institution acceptable to the Pag-IBIG Fund

  • Combined Loan Purpose

– Combination of loan purposes (limited to the following: purchase of a fully developed lot not exceeding 1,000 square meters and construction of a residential unit thereon; purchase of a residential unit, old or new, with home improvement; refinancing of an existing mortgage with home improvement; refinancing of an existing mortgage, specifically a lot loan, with construction of a residential unit thereon).

Here goes the step-by-step guide to availing a housing loan:

  1. Visit the nearest Pag-IBIG office near you to inquire about their housing loan program and get a checklist of requirements.  You may also get your checklist online.

Basic requirements include:

  • Housing Loan Application (HLA) form, with recent ID photo of borrower and co-borrower (if applicable);
  • Proof of income;
  • 1 valid ID of principal borrower and spouse, co-Borrower and spouse;
  • Transfer Certificate of Title (certified true copy);
  • For condominium unit, Transfer Certificate of Title of the land and Condominium Certificate of Title (certified true copy);
  • Updated tax declaration (house and lot) and updated real estate tax receipt;
  • Contract-to-Sell or similar agreement between the buyer and seller; and
  • Vicinity map/sketch of the property.

Borrowers over 60 years old and members availing of P2-million to P6-million loans also need to submit a health statement form (medical questionnaire).

2.  Submit your Housing Loan Application along with other forms and pay the processing fee of PHP 1,000.

You may submit your HLA with complete requirements at any Pag-IBIG Fund offices near you. You may also file your housing loan application online. Upon submission of all requirements, you also need to pay a non-refundable processing fee of P1,000.

3. Wait for your Notice of Approval (NOA)/Letter of Guaranty (LOG) and sign your loan documents.

The NOA will be released only to the borrower or, for OFW borrowers, to the attorney-in-fact. If an application is not approved, the borrower will receive a Notice of Disapproval instead. Upon receipt of your NOA, sign your loan documents and submit within 90 days.

4. Submit all your NOA requirements to Pag-IBIG Fund for the release of your check. You have 90 calendar days to accomplish all your NOA requirements, which include going to the following:

– Bureau of Internal Revenue for payment of capital gains tax and documentary stamps;

– Local government unit for payment of transfer tax and transfer of tax declaration; and

– Registry of Deeds for transfer of the title and annotation of mortgage.

5. Receive your loan proceeds

To get your loan proceeds at the Pag-IBIG Fund, you need to bring at least 2 valid IDs and show the following documents:

– Transfer Certificate of Title/Condominium Certificate of Title in the name of the borrower/co-borrower/s (if applicable) with mortgage annotation;

– Updated tax declaration (house and lot) and tax real estate tax receipt in the name of the borrower/co-borrower/s (if applicable);

– Deed of Absolute Sale with original stamp from the Registry of Deeds;

– Occupancy permit (secured from LGU Engineering Office, if applicable); and

– Assignment of loan proceeds.

6. Start your monthly amortization payments.

The amount of your monthly amortization is stipulated in the documents you previously submitted and it can also be double check through the loan affordability calculator. Be sure to pay your monthly amortizations promptly. Well, you wouldn’t want to face the risk of having your housing loan cancelled or foreclosed.

Have you experienced applying for the Pag-IBIG housing loan to purchase your dream home? Share with us your experience by leaving a comment below!

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