Pag-IBIG’s Loan Restructuring Program Offers Economic Relief for Members

Under the special loan restructuring program, Pag-IBIG Fund is offering up to six months of payment relief, more affordable amortization, and waived penalties, according to Sunstar. This forms part of the agency’s initiative to extend assistance to their members facing economic difficulties amid the pandemic.

The program is available for borrowers with unpaid monthly amortizations of up to 12 months as of August 2020. The settlement of unpaid dues will be spread with no penalties on arrears. By extending loan terms, members can also have lower monthly payments.

Moreover, borrowers have the option to start payments on the restructured loans by as late as March next year.

Application through Digital Platform

To increase safety and convenience, Pag-IBIG urges interested individuals to apply for the loan restructuring program online via the Virtual Pag-IBIG platform. Submission of requirements will be until December 15.

Among the documents necessary for application are a valid identification (ID) card with signature and a selfie photo showing the card. Applicants should be able to provide the housing account number as well. 

Pag-IBIG clarifies that there’s no downpayment or processing fee for the applications.

Aside from loan applications, Virtual Pag-IBIG allows individuals to access other services, including member registration, opening of savings accounts, and viewing of records and loan status. The platform is likewise supported by digital payment channels, allowing members to settle loan obligations conveniently.

Since the implementation of community quarantine measures, Pag-IBIG has strongly promoted the use of the online portal. 

As the lockdown protocols eased in different parts of the country, the agency’s physical branches gradually opened, observing health and safety policies, such as mandatory wearing of face masks and face shields.

Grace Period for Loan Payments

Earlier, Pag-IBIG announced granting a 60-day grace period on all loan payments, in accordance with Republic Act No. 11494, also known as the Bayanihan to Recover as One Act (Bayanihan 2).

The agency applies the grace period automatically to all payments, including multi-purpose loan, calamity loan, and housing loan. It covers bills falling from September 15 to November 14, 2020. Borrowers will not earn any penalty or interest on interest.

While the Bayanihan 2 law accommodates loan accounts with up to three months in arrears, Pag-IBIG’s guidelines have expanded the scope, covering those with up to nine months in arrears.

As for the accrued interest, members can pay until December 31 under the Bayanihan 2. Pag-IBIG, however, offers the option of installment basis, spread across the remaining term of the loan.

This is the second time that the agency granted a grace period to borrowers. Back in April, they provided a three-month moratorium for all loans. It covered payments due from March 16 to June 15. 

Accessible Home Ownership

Aside from payment reprieve, Pag-IBIG has offered promo rates for housing loans until December. Introduced in July, the rates include 4.985 percent per annum under a one-year repricing period and 5.375 percent per annum under a three-year repricing period.

Meanwhile, the subsidized interest rate under the Affordable Housing Program remains at 3 percent per annum.

The agency hopes that this will entice members to apply for home loans. Creating a momentum of real estate purchases, it has the potential of creating more jobs and facilitating economic recovery.

The lending activity directly contributes to the growth of the property sector. Citing Colliers International Philippines’ insights, Lamudi’s latest trend report titled Provincial cities and overseas interest contribute to real estate resilience showed that the low loan rates in the market, complemented by flexible lease terms from property developers, will strengthen the buying power of investors, particularly those in provincial cities, such as Cebu and Davao.

The mid-income segment, residential projects priced between P3.2 million to P6 million, will enjoy renewed interest moving forward.

One of the market segments expected to fuel such demand is the overseas market, including overseas Filipino workers (OFWs) who are looking for properties with open, big spaces to house their families.

In the previous Lamudi trend report, titled Property investment as a safe haven during a crisis, which looked into the home buying trends at the height of the community quarantine measures, affordability emerged as a major consideration for property seekers.

Foreclosed properties were popular commanding an average lead growth rate one percent higher than house types during the implementation of the enhanced community quarantine.

Sources: Sunstar, Pag-IBIG

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