On Pag-IBIG and other housing loans

Q: I have been working for more than four years already and have been diligently contributing to Pag-IBIG, SSS and others. I wanted to take a housing loan for maybe 2M to 4M. I saw a house & lot for sale somewhere in UP Village, Quezon City. It is being sold for 10M, 2 houses in a 736 sq. m. lot. I was too late because it was already sold. I was also lost on where  and how to get financing  for house purchases.

If you have some details re: housing loans it would be great... so that in the future I know where to go and/or ask.

Regards,
Ms. Looking-for-housing-dette-info

A:

Pag-IBIG Fund (or Pagtutulungan sa Kinabukasan: Ikaw, Bagko, Institusyon at Gobyerno, a.k.a Home Mutual Fund) offers the lowest interest rates in the market. However, the maximum amount that you can borrow is only two million.

Mortgage Rate	Loanable Amount
6%	P300,000 and below
7%	P300,000 - P750,000
10.5%	P750,000 - P2,000,000

The interest rate for the loan is fixed up to 30 years, w/c means there is no risk that you have to pay a higher amortization if ever interest rates go up.

The Loan-to-collateral ratio (a.k.a loan-to-value (LTV) ratio) of the loan amount to the appraised value of the collateral shall not exceed the following rates:

Loan Amount	With Buyback Guaranty	Without Buyback Guaranty/ Retail Account
Up to P300,000	100%	100%
Over P300,000 to P750,000	100%	90%
Over P750,000 to P1M	95%	85%
Over P1M to P2M	90%	80%

This means that for a property worth 2M, the maximum amount you can borrow is only 1.8M, the remainder (PhP200,000) you must pay in cash.

If you intend to buy a house worth PhP2M, how much are you going to pay monthly? If you choose with buyback guaranty (down payment of PhP200,000) and interest rate fixed for 30 years, your monthly amortization for the PhP1.8M loan is PhP16,465. (you can use the amortization calculator on this page http://www.pagibigfund.gov.ph/mt_calc.htm)

If you intend to borrow a bigger amount, you have to go to a commercial bank. Interest rates are higher and LTV ratios are typically lower, at 80% – 85% (i.e. down payment is 15% to 20% of the property value). The length of time that the interest rate is fixed is also shorter.

For comparison, here are the rates for two major commercial banks:

	BDO	BPI
	Super Value Home Loan	Build Your Dream Housing Loan
Mortgage Rate
fixed for 1 year	8.75%	8.75%
fixed for 2 years	9.25%	9.25%
fixed for 3 years	9.50%	9.50%
fixed for 4-5 years	9.75%	9.75% (5 yrs)
fixed for 10-15 years	10.99%	10.99% (6 -15 yrs)
fixed for 25 years	11.50%	11.50% (16 - 25 yrs)
Minimum Loanable Amount:
	P500,000.00	PhP 400,000
Maximum Loanable Amount: Based on appraised value of property
House and Lot	80%	70%
Townhouse	80%	70%
Condominium	70%	70%
Vacant lot	70%	70%
Maximum Loan Term
House and Lot	20 years	20 years
Townhouse	20 years	20 years
Condominium	15 years	10 years
Vacant lot	10 years	10 years

The following info came from the website of Pag-IBIG Fund:

http://www.pagibigfund.gov.ph/index.asp

Requirements for a Pag-IBIG Housing Loan

1. APPROVED PAG-IBIG Membership Status Verification Slip (MSVS)

(To secure PAG-IBIG MSVS, applicant must attend PAG-IBIG counseling at PAG-IBIG office-Rm 701 Atrium Bldg. Makati City)
2. PAG-IBIG LOAN COUNSELLING QUESTIONAIRE (PLCQ)
Signed by PAG-IBIG representative/counselor
3.Two (2) pcs, ID picture (1 x 1 )
4. Valid CERTIFICATE OF EMLOYMENT and COMPENSATION duly notarized (for PAG-IBIG I & II)
5. EMPLOYMENT CONTRACT  or EMPLOYER’S CERTIFICATE OF INCOME (for POP members)
6. Latest PAYSLIP (one-month)
7. COMPANY ID or any VALID ID with applicant’s signature (photocopy)
8. INCOME TAX RETURN (ITRs) and W2 for the last  two (2) years.
9. PROOF OF BILLING ADDRESS (photocopy)

How does one avail of a Pag-IBIG Housing Loan ?

1. Attend a Loan Counseling session at the Pag-IBIG Office concerned

Accomplish a Preliminary Loan Counseling Questionnaire, Housing Loan Application (HLA) and Membership Status Verification Slip. If eligible, secure checklist of requirements.

2. Submit HLA with complete requirements. Pay a processing fee of P1,000.00 (non-refundable)
3. Receive Notice of Approval/Letter of Guaranty and sign loan documents.
4. Proceed to BIR and present Deed of Absolute Sale (DOAS) between owner of the property and applicant for payment of documentary stamps and capital gains tax.
5. Proceed to Registry of Deeds (RD) for payment of transfer of tax and registration fees for the transfer of title.
6. Proceed to Notary Public for notarization of LMA and annotation of mortgage with the Registry of Deeds (RD) and to Assessor's Office to secure new tax declaration in the name of the applicant.
7. Secure Occupancy Permit from the Local Government Unit's (LGU) Engineering Office for Purchase of new Residential Unit (PRU), Purchase of Lot and Construction of a New Residential Unit (PLCH) and Construction of House (CH) loan purposes.
8. Submit the following documents to Pag-IBIG office concerned:
• Original Transfer Certificate of Title in the name of the applicant with annotated mortgage
• DOAS with original RD stamp
• New Tax Declaration in the name of the applicant
• Updated Real Estate Tax Receipt (house and lot, if applicable)
• Occupancy Permit
• Assignment of Loan Proceeds
9. Release of loan proceeds
10. Start monthly amortization on the month immediately following loan take-out/final loan release.

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HTH

prince