Pag-IBIG extends P7.4 B loans for socialized housing

MANILA, Philippines — Home Development Mutual Fund (HDMF), also known as the Pag-IBIG Fund, boosted its lending for socialized housing units in the first nine months of the year amid lower interest rates.

Pag-IBIG financed 19,189 socialized homes from January to September, 15 percent higher than the 16,505 homes it funded the same period last year.

The amount disbursed for socialized housing loans jumped 24 percent to P7.44 billion in the first nine months from P6.01 billion in the same period in 2017.    

Socialized housing loans made up 31 percent of all homes financed by Pag-IBIG since January. The program benefits minimum- and low-wage workers who are usually shunned by banks.

Early this year, Pag-IBIG slashed its interest rates for socialized housing to three percent per annum. The fund subsidizes these low interest rates through its tax savings, being a tax- exempt agency as specified under Republic Act No. 9679.

“Our charter allows Pag-IBIG fund to offer the lowest rates for minimum- and low-wage workers. And because of the fund’s better-than-expected financial performance, we see no reason to increase the three percent per annum subsidized rate in the near future,” Pag-IBIG chief executive officer Acmad Rizaldy Moti said.

“Unlike other institutions, we have a 100 percent loan-to-value ratio in socialized housing program wherein borrowers don’t have to pay for equity when they apply for a socialized housing loan with Pag-IBIG Fund,” he added.

By the end of 2018, Pag-IBIG aims to finance 26,709 units worth P8.87 billion under socialized housing.

“Socialized housing is designed especially for the minimum- and low-wage workers,” said Secretary Eduardo del Rosario, chairman of the Housing and Urban Development Coordinating Council (HUDCC) and Pag-IBIG Board of Trustees.

“President Rodrigo Roa Duterte directed that there be government programs catering to this marginalized sector, hence, we have this housing program that caters to their financial capacity. This is the essence of BALAI Filipino (Building Adequate, Livable, Affordable, and Inclusive Filipino Communities), Del Rosario added.

Meanwhile, HDMF said it has also released P37.43 billion in short-term loans (STL) – Calamity Loans or Multi-Purpose Loans – by the end of the third quarter, benefiting 1.82 million borrowers.

From July to September, alone, Pag-IBIG disbursed P1.03 billion in calamity loans to 80,698 families affected by typhoons and heavy rains.

Another P12.18 billion was released for multi-purpose loans to assist the financial needs of 597,238 borrowers.