One of the top lists of the overseas Filipino workers (OFWs) is to provide a decent home for the family. Preferably, a house inside a gated and secured subdivision with complete amenities such as clubhouse, swimming pool, basketball court, children playground and parks.
The best way for OFWs to own a home is through the Housing Loan Program of the Home Development Mutual Fund (HDMF) popularly known as the Pag-Ibig (Pagtutulungan sa Kinabukasan: Ikaw, Bangko, Industria at Gobyerno) Fund.
One of 4 Pag-ibig housing loans is availed by an overseas Filipino worker. In 2018, there are 146,443 OFWs who have availed of housing loan from the Pag-Ibig Fund. Get your own home now! Contact us for free orientation.
Let us discuss in this blog how Pag-Ibig Fund can help you own a decent and affordable home for your family.
Pag-Ibig Fund as Preferred Provider of Home Loan
The Pag-Ibig Fund has a total of 13.63 million members with an asset of P515.24 billion. To date, it has 133 branches nationwide and 23 overseas posts.
In its 2019 3rd Quarter report, the Pag-Ibig Fund home loan releases grew by 13% to record P58.73 billion. It's a double-digit growth and the highest ever amount released by the agency for any January-to-September period. This is a continuing growth: P65 billion in 2017 and P75 billion in 2018.
From January to September 2019, the Pag-Ibig Fund approved P80.87 billion in home loans to finance the acquisition of 84,904 homes. There is a pending (already approved but not yet released) of P22.14 billion takeout to 19,529 borrowers.
The Pag-Ibig Fund has remained committed to providing decent and affordable home financing to the Filipino workers. Pag-Ibig Fund Chief Executive Officer Acmad Rizaldy P. Moti said the remarkable growth can be attributed to its lowest-ever interest rates, high loan-to-appraisal ratio, long repayment period and much improved insurance terms.
The premium mortgage insurance gives an OFW a peace of mind. In case he/she is unable to pay the remaining monthly amortization for his/her home loan due to death or accident causing disability, the loan is deemed paid. It means, his/her loved ones are not deprived of the house-and-lot he/she bought for them.
In this blog, let us focus our discussion on the Pag-Ibig Housing Loan Program for Overseas Filipino Workers.
Membership for Overseas Filipino Workers (OFWs)
An OFW can register with the Fund thru any of the following modes: (a) Register at the Members Services Office (MSO)/Branch, or (b) Submit duly accomplished Member’s Data Form to Members Services Office (MSO)/ Branch servicing counter. The membership form can be downloaded here.
The Pag-Ibig Fund is the reliable partner for OFWs in acquiring a decent house for their families and for leasing business as well. It is the preferred housing loan provider for the OFWs. However, some OFWs are still hesitant to avail the Pag-Ibig Housing Loan Program because they don't know about the program.
Pag-Ibig Housing Loan Program
Watch this short info video about the Pag-Ibig Housing Loan Programs.
There are two types of Pag-Ibig housing loan program: (1) the regular Housing Loan Program and (2) the state-subsidized Affordable Housing Loan Program for Minimum Wage Workers (with monthly earning of P12,000 and below in Cebu). Obviously, the applicable program for the OFWs is the regular Housing Loan Program.
Pag-Ibig Housing Loan Basic Features
Pag-Ibig Housing Loan has 4 basic features:
(1) Borrow up to P6 million (2) Lowest interest rates (as low as 5.375% interest rate per annum)
(3) Longest repayment term (up to 30 years)
(4) Multiple housing loans
Pag-Ibig Housing Loan Rates
Below is the table of the Pag-Ibig Housing Loan interest rates.
Based on January 2019 data, here are the interest rates of the major commercial banks:
If you compare the interest rates, the Pag-Ibig Fund has a competitive advantage over commercial banks. However, there were special rates offered from time to time by banks as come-on rates for as low as 5% for 1-year fixed rate. The prevailing market interest rates range from 7%-9% per annum.
Pag-Ibig Housing Loan Repayment Term
Another advantage of Pag-Ibig Housing Loan is the maximum repayment period up to 30 years. While we don't recommend the 30 years repayment period for OFWs because it doubles the price of the property, this option is helpful to locally employed Filipinos whose income is just enough to finance the house with 30 years repayment term. Since the OFW can afford a higher monthly amortization, we highly recommend the 10-15 years repayment term. If he/she can afford to pay a higher down payment, the better.
Pag-Ibig Housing Loan Requirements
In general, commercial banks have stricter requirements for borrowers. However, at a closer look, the documentary requirements are all the same. The significant difference is on income requirement. The bank will cater only to workers with at least P40,000 monthly income.
In Pag-Ibig housing loan, the member who wants to avail of the housing loan program must have at least 24 months of contribution. However, the member has the option to complete the 24 months contribution by paying the balance or by paying the whole amount equivalent to 24 months contribution.
The member must have no existing multi-purpose loans in arrears. And no history of Pag-Ibig housing loan that was cancelled, foreclosed, or bought back.
Check the purposes of the Pag-Ibig Housing Loan and list of requirements for your perusal.
Pag-Ibig Mortgage Redemption Insurance
The Pag-Ibig Fund has its own mortgage insurance program to free a borrower-member of any obligation to pay a housing loan upon death or total permanent disability. It is called the Mortgage Redemption Insurance (MRI).
Aside from the full payment of the house-and-lot (or condo unit or residential lot), the family of the deceased member will get P20,000 in burial benefits. When the borrower-member is terminally ill (e.g. cancer), he/she will get P500,000 in amortization support. It means that If the borrower has a balance of P1 million, the balance to paid will only be P500,000.
How much is the MRI? The MRI premium is 23 centavos per P1,000 loan value.
OWN A HOME THRU PAG-IBIG HOUSING LOAN
Highly recommend subdivision and condominium projects in Cebu City, Mactan Island and Carcar City. You may avail them through the Pag-Ibig Housing Loan.
(1) House and Lot
AMBERLEY - Kalawisan, Lapulapu City - P9,200/month
TIERRA NAVA - Carcar City - P6,350/month
(2) Condo
PLUMERA - Basak, Lapulapu City - P6,149/month
BLOQ RESIDENCES - Sikatuna St., Cebu City - P9,673/month
This discussion is for educational purposes only. Consult your lawyer for advice on your specific case. For any questions, contact us.
If you’re planning to buy a residential lot, house-and-lot, or condo unit, get in touch with us at 0920 207 5035 or email cebuhousefinder@yahoo.com for free assistance.
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