SSS increases fees for housing loans

The Social Security System (SSS) has increased the application and the inspection fees for housing loans to align them with industry standards as well as increase the system’s income.

The application fee was raised from P500 to P1,000 while the inspection fee has been increased to a uniform rated P500, from the previous P100 for Metro Manila and P150 for areas outside Metro Manila.

According to the SSS, the new rates are consistent with those set by other government financial institutions (GFIs). The loanable amount remains the same.

For low-cost housing loans, the maximum amount remains at P500,000 while for socialized housing, it is still P180,000.

The inspection fees charged by other GFIs are as follows: Land Bank of the Philippines (LBP) — P2,000; Home Development Mutual Fund (HDMF) — P1,000; and Development Bank of the Philippines (DBP) — from P1,500 to P3,000.

The SSS also increased to P100 the service fee for members renewing or applying for certificates of loan eligibility.

The SSS said it has disbursed some P50 million to home financing agencies and private banks. Directly, it has issued P15.2 million to overseas workers and trade union members since it started direct lending in August 2000.

SSS president and chief executive officer Corazon de la Paz said the pension fund hopes to generate additional income from the new rates as its level of reserves has gone dangerously low. Based on actuarial studies, SSS said its reserves will run dry in 2015 unless its premium rates are increased or its collection efficiency improves.

The system which has 24 million members, proposes a gradual increase in its rate of contributions, from 8.4 percent to 14 percent by 2005.

De la Paz pointed out that benefit payments grew by more than 15 percent while retirement claims grew by 23.38 percent and death benefits increased by nine percent. In contrast member contributions grew by a mere 3.56 percent last year, De la Paz said.

Meanwhile, the Private Sector Consultative Council for Shelter (PCCS) called on the National Economic and Development Authority (NEDA) and the Housing and Urban Development Coordinating Council (HUDCC) to increase the loan ceiling for socialized housing.

The PCCS, a unified advocacy and consultative body for the country’s major real estate organizations, wants the P180,000 ceiling for socialized housing loans increased to P250,000 with a nine-percent interest rate.

It said the suggested increase recognizes increases in prices of construction materials, labor costs and land prices.