All things you need to know about PagIBIG Fund
PagIBIG Loan Calculator
|Loan Amount||Indicative Rates Repricing Period|
|3 Years||5 Years||10 Years||15 Years||20 Years||25 Years||30 Years|
|Up to 6M PhP||6.985 (%)||7.825 (%)||8.775 (%)||9.385 (%)||9.675 (%)||10.000 (%)||11.375 (%)|
This calculator computes the approximate Principal and Interest and the Required Gross Monthly Income only. MRI and other fees and/or charges are NOT included in the computation.
Home. What is home? The Merriam-Webster Dictionary defines this as one’s place of residence or origin, but is it really limited to just that? Another definition describes a home as the social unit formed by a family living together. This latter definition could not be any more accurate, particularly in the Philippine setting. Filipinos traditionally consider the home as more than just the physical structure standing on a piece of land, and extends it to the social relationships built and developed by the residents. Whether it be with family or friends, a home is a place where one can go back to at the end of the day.
Owning a home in the Philippines is not a small feat, considering that as of 2015, the average income of a Filipino family was around Php 267,000 a year, while their average expenditure was at around Php 215,000. This means that the average Filipino family saves only around Php 52,000 a year. Purchasing a home may or may not be cheaper than building a home, but is dependent on several factors, including, but not limited to the size of the home, its location, or its proximity to key areas in the Metro. Potential purchasers of already-built homes, however, trade in the privilege of personalization for convenience.
On the other hand, as of 2016, building a medium-sized home with one to two bedrooms would cost around Php 25,700 to Php 31,000 per square meter, exclusive of the fees to be paid in the procurement of permits and all the other forms of paperwork mandated by the relevant laws and ordinances. With that in mind, it would therefore be prudent to say that a 100 square meter house would cost, at the least, Php 2.7 million. The average family’s breadwinner would therefore have to save up for around 51 weeks or over 4 years to afford the construction of their home. This, however, is on top of all the other expenses that the family incurs in a day, month, or year.
One option that might be available to aspiring homeowners is taking out a loan from the HDMF or the PAG-IBIG Fund.
What is PagIBIG fund?
The Home Development Mutual Fund (HDMF) or more popularly known as the Pagtutulungan sa Kinabukasan: Ikaw, Bangko, Industriya, at Gobyerno Fund or the PAG-IBIG Fund is a fund dedicated to the creation and establishment of a national savings program and an affordable shelter financing scheme for Filipinos. It was first established in 1978 through the enactment of Presidential Decree No. 1530, and was created primarily to address these issues. Its enabling law has gone through several amendments that have subjected the HDMF to changes in administration, as well as changes in the various rules and regulations governing its operations. Basically, the HDMF acts as the Government’s response in order to address the aforementioned issues through the provision of housing and financing schemes that would help ordinary Filipinos afford their dream homes.
Republic Act No. 9679
In 2009, the Arroyo administration enacted Republic Act No. 9679 or the Home Development Mutual Fund Law of 2009. Essentially, the law gave the HDMF more authority and privileges that would not only give it an avenue to financially assist more of its members, but also opportunities to maximize the use of its funds. For instance, membership to the HDMF is now mandatory for all employees covered by the SSS and the GSIS, as well as for uniformed members of various police and military institutions, such as the AFP, PNP, BFP, and BJMP. It also mandates the membership of Filipino employees of foreign-based employers. The new law also exempts the HDMF from tax payments, while giving its Board of Trustees the authority to set contribution rates, thereby giving the HDMF more funds to finance its housing projects, give out short-term loans to its members, and invest in government securities.
What does PagIBIG Fund do?
The HDMF has three main functions: Savings, Insurance, and Loans. With these, the HDMF functions to help the ordinary Filipino worker to finance not only his housing needs, but also his other immediate and long-term financial needs.
The HDMF’s Provident Savings function involves the application of its mutual fund, particularly in the form of savings and investment. This function deals with the collection and management of the law-mandated contributions of its members, and in some cases, their employers, as well as their dividend earnings. The programs under this function vary with regard to several important aspects. For instance, the PAG-IBIG Savings Program is the mandatory program under this function that provides for a significantly cheaper monthly contribution, but at a regular yield. This is in contrast to the Higher Investment Return through Modified PAG-IBIG 2 Savings Program, which is an optional program for members that provides for a rather expensive monthly contribution, but with a significantly higher yield than that provided by the mandatory PAG-IBIG Savings Program.
Several Non-Life Insurance Programs are also made available by the HDMF to its members, thereby allowing them to secure their properties from the risks that may stand to endanger their homes. The Mortgage Redemption Insurance program under this function provides amortization support of up to Php 500,000 or a 20 per cent refund in case of the member’s inability to pay the remaining amortization payments due to such member’s death or permanent disability, subject to certain conditions. The Fire and Allied Perils Insurance Program, on the other hand, insures properties subject to PAG-IBIG Loans from risks including fire, earthquake, flooding, and other natural disasters and accidents.
The HDMF also provides its members with several loan options that may cater to their specific or general needs. These loans vary in the requirements that have to be met by members to avail thereof and in the benefits that each type may provide to availing members.
The types of loans provided by the HDMF include:
- Housing Loans
- Multi-Purpose Loans
- Calamity Loans
Housing Loans, particularly the Regular Housing Loans (RHL) and the Affordable Housing Program (AHP), generally allow eligible members to borrow money from the HDMF for purposes that would necessarily involve the purchase of land or of a residential building or unit. These may also be availed of by members who may be planning to commence construction of their home, or the improvement or renovation of their existing home, or even the refinancing of an existing housing loan. Members availing of the AHP may borrow as much as Php 750,000, based on several factors, including the gross monthly income earned by the member, while members availing of the RHL may borrow up to Php 6 million, subject to certain conditions.
Finally, Calamity Loans are schemes that allow members to take out loans during times of need brought about by the occurrence of calamities and other disasters that may or may not have been foreseeable. Aggrieved members may take out loans up to 80% of their total accumulated value, within 90 days from the declaration of a state of calamity. It is important to note that these loans may still be taken out by affected members even if they have outstanding multi-purpose loans or calamity loans, subject to certain restrictions with regard to the amount of calamity loan that may be availed of.
How to become a PagIBIG member?
There are two types of PAG-IBIG members: mandatory members and voluntary members. Mandatory members refer to those individuals whose membership were made mandatory by the enactment of Republic Act No. 9679 in 2009. Voluntary members, on the other hand, are those individuals whose membership were not mandated by the said law, but are still interested in availing of the benefits attached to such membership.
The law provides for certain qualifications for each type of member. However, these qualifications may be said to be strictly applied to mandatory members, considering that their mere inclusion in the enumerated list under the law qualifies and necessarily includes them within the coverage of the HDMF, thereby attaching unto them the appropriate monthly contributions, as well as the benefits that they may reap as members. In this light, the law enumerates those who shall be deemed mandatory members of the HDMF, including:
- Employees who are ought to be covered by SSS, including but not limited to:
- Private employees not over 60 years old;
- Household helpers whose monthly earnings are at least Php 1,000;
- Filipino seafarers, upon entering into a contract of employment with the manning agency and the foreign ship owner as employer;
- Self-employed individuals not over 60 years old, with monthly earnings of at least Php 1,000; and
- Expatriates who are not over 60 years old and are compulsory members of the SSS.
- Employees who are mandatory members of the GSIS, including members of the Judiciary and the Constitutional Commissions (COMELEC, COA, CSC).
- Uniformed members of the AFP, BFP, BJMP, and PNP.
- Filipinos employed by foreign-based employers, whether deployed in the Philippines or abroad.
Voluntary members, on the other hand, do not necessarily include those excluded by the above list of mandatory members. Individuals at least 18 years old, but not over 65 years old may register as voluntary members. Their registration, obviously, necessitates compliance with the same rules and regulations for all PAG-IBIG members, as well as with the eligibility requirements for availing of the loans and benefits offered by the HDMF. In this light, the following people may be allowed to apply as voluntary members:
- Non-working spouses whose employed spouses are registered members and consents to the membership of the former.
- Filipino employees of foreign states or international organizations.
- Employees of companies that are granted waivers or privileges purporting to suspend the coverage of the fund.
- Leaders and members of religious groups.
- A recently unemployed member who would like to continue paying his or her personal contributions.
- Public Officials not covered by the GSIS, such as Barangay officials.
- Other earning individuals and groups, as may be determined by the Board.
Applying for Membership
Registering as a new member has been made easier due to the advent of technology. Gone are the days when people has no choice but to stand in long lines for hours in the heat of the morning sun just to register as members of the HDMF.
Member registration may be done in person or through the available online channels. Applicants registering in person would have to take into account several factors that may make the process easier. First, it would be important for applicants to take note of the office hours of Members Service Offices or Branches on regular days. These offices are expected to be open for transactions from 8 o'clock in the morning to 5 o'clock in the afternoon, with no noon breaks. It is also important to note that no processing fee has to be paid for registration as members. It would be best to avoid fixers who may promise faster transaction times for handling fees as this practice is frowned upon and highly discouraged. The registration process, in general, is outlined below:
- Applicants first accomplish beforehand a Pag IBIG Member’s Data Form.
- They would then have to visit the Members Services Office or Branch nearest them and submit 2 copies of their duly accomplished Member’s Data Form, along with the other supporting documents required for each individual voluntary member to the branch’s Marketing and Enforcement Division.
- Applicants would then have to procure a Payment Order Form and head to the Cash Division for payment of their contributions.
- Upon payment, they would then have to the Marketing and Enforcement Division and present their verified supporting documents.
Pag-IBIG employees are available to inform and assist applicants with the various stages of the registration process.
Pag IBIG Online Registration
Online applicants, on the other hand, would only have to accomplish the online registration form and create an online account in the PAG-IBIG system. Upon submission of the form, a Registration Tracking Number would then be issued by the system to the applicant. It is important to note that this tracking number would be required for the succeeding stages of the registration process. Applicants may also opt to personally visit the Members Service Office or Branch and perform the outlined process for online registration.
Successful registrants would then be informed of the availability of their PAG-IBIG Membership ID number with the corresponding instructions on how to get it, either through text (if the registrant’s contact number was given) or through the PAG-IBIG Hotline. The Citizen’s Charter on Membership Registration, which briefly outlines these procedures, also provides that registrants may call the relevant Pag IBIG office contact number at 724-4244, 2 days after successful registration.
Housing Loans vs. Multi Purpose Loans
|Housing Loan||Multipurpose Loan|
|This loan allow members to borrow money from the fund for the purchase of property or for the renovation or improvement of existing properties.||This loan provides financial assistance that would cater to the other needs that members might have, whether it be related to matters remotely related to the establishment of a home or minor renovations or repairs of the home. These needs may include those pertaining to the medical, educational, and livelihood expenses a member might have, among others.|
|Member Type||Basic Requirements for Applying|
|OFW||Basic Requirements, plus the following:
|Basic Requirements apply.|
|Self-Employed||Basic Requirements, plus the following:
|Basic Requirements, plus the following:
Proof of Income:
FAQ: Frequently Asked Questions
• For applicants without contact numbers, inquiries may be made 2 days after registration through the PAG-IBIG Hotline or at 724-4244.
|Processing Time||Processing Time|
|2 working days||Receipt of documents required upon loan application up to endorsement of documents for credit investigation and property appraisal.|
|6 working days||Receipt of endorsed documents up to generation of the result of credit investigation and property appraisal.|
|8 working days||Receipt of the result of credit investigation and property appraisal up to approval of loan application.|
|1 working days||Receipt of approval of loan application up to release of Notice of Approval.|
|3 working days||Preparation of Request for Payment up to Check availability.|
- Have completed at least 24 monthly contributions;
- Are active members with at least 5 monthly contributions within the last 6 months, as of the month prior to the date of loan application;
- Live in an area declared as under a State of Calamity by the Office of the President or by the Local Government Unit concerned.
Even if a member has an existing Housing Loan, Multi-Purpose Loan (MPL), and/or Calamity Loan, he or she can still qualify provided the loan is not in default on the date of the application.
Note, however, that proceeds from the new Calamity Loan will be used to settle the existing Calamity Loan first. So for example, the member received P10,000 from the new Calamity Loan and has an outstanding loan balance of P4,000, he or she will only net P6,000.
Also, the total amount of the MPL and the Calamity Loan should never exceed the TAV.
Applicants must submit the following to any Pag-IBIG office nationwide:
- Filled-up Calamity Loan Application Form
- Photocopy of at least 2 valid IDs
- Proof of Income
- For formally employed members, duly accomplished Declaration of Being Affected by Calamity
The Calamity Loan Application Form can be downloaded here.
The loan is amortized over a period of 24 months with a grace period of 3 months. Monthly amortization payments start on the 4th month from the date the check was issued. Interest rate is P 5.95 percent per annum.
Eligible borrowers can apply for a Calamity Loan within 90 days from the declaration of the state of calamity.
Know your privileges as a Pag-IBIG member; it might come in handy in times of need.
Learn more about Pag-IBIG from their website or call (02) 724-4244.
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