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The Pag-IBIG Fund allows its members to borrow a maximum loanable amount of only PHP 6 million. However, this is subject to certain conditions. For instance, the maximum amount that a member can borrow depends on his actual need and his capacity to pay. The interest rate will also depend on the loaned amount, but will not exceed a maximum of 11 percent per year.
Seemingly tailored to the working Filipino, the Pag-IBIG Fund Housing Loan is also recognized as a “salary loan” because the amount one is eligible to borrow depends on the contributions the Pag-IBIG member has made while employed. Even minimum-wage earners who make contributions can buy their own homes through the Affordable Housing Program this 2023.
The maximum repayment period for a Pag-IBIG loan is 30 years, furthering its case as the ideal loan type for low- to middle-income earners. If you are not over 65 and have remitted at least 24 monthly contributions to the Pag-IBIG Fund, you can apply for a housing loan.
To fully qualify, you should also not have any outstanding housing or multi-purpose loans with Pag-IBIG, nor should you have a Pag-IBIG Housing Loan that had been cancelled, bought back, or foreclosed. Should you indeed be eligible and would like to apply, you simply have to follow these steps.
Step-by-step Guide for Applying for a Pag-IBIG Housing Loan
Source: 6 Steps in Pag-IBIG Housing Loan Availment
1. Get and complete the necessary forms and documents
This includes:
- Checklist of requirements
- Housing Loan Application (HLA) form
- Health Statement Form
- Special Power of Attorney (SPA) (if applicable).
Visit the Pag-IBIG Fund office nearest to you or go to www.pagibigfund.gov.ph for a complete list of the forms you may be required to fill out.
2. Submit all requirements and fees
- Currently, the non-refundable processing fee required to be paid is Php1,000.
- Submission of the HLA can be completed at designated Pag-IBIG offices or online by clicking “E-Services” on www.pagibigfund.gov.ph.
- Processing typically takes 20 working days, inclusive of the necessary credit investigation and property valuation.
3. Receive Notice of Approval (NOA) or Letter of Guaranty (LOG)
The NOA is only released to borrowers, or to the Attorney-in-Fact for OFW borrowers who provide a Special Power of Attorney (SPA). Upon receipt of the NOA or LOG, subsequent loan documents must be signed and submitted.
4. Fulfil NOA requirements for check to be released
Upon receiving the NOA, borrowers have 90 days to complete the following requirements for their check to be released:
A. For the purchase of a house and lot, condominium unit, or vacant lot
- Provide the seller with the LOG
- Pay the associated Capital Gains Tax (CGT) and Documentary Stamp Tax (DST) to the Bureau of Internal Revenue (BIR), which subsequently issues the Certificate Authorizing Registration.
- Pay Transfer Tax to the city or municipality (local government unit or LGU) where the property is located.
- Have the title and annotation of mortgage transferred by the Registry of Deeds.
- Return to the LGU for the transfer of Tax Declaration.
- Submit the completed requirements to the Pag-IBIG Fund.
B. For the purchase of a house and lot mortgaged by the Pag-IBIG Fund
- Pay the associated CGT and DST to the BIR, which subsequently issues the Certificate Authorizing Registration.
- Pay Transfer Tax to the LGU.
- Have the title and annotation of mortgage transferred by the Registry of Deeds.
- Return to the LGU for the transfer of Tax Declaration.
- Submit the completed requirements to the Pag-IBIG Fund.
C. For house construction or home improvement
- Pay the associated CGT and DST to the BIR, which subsequently issues the Certificate Authorizing Registration.
- Pay Transfer Tax to the LGU.
- Have the title and annotation of mortgage transferred by the Registry of Deeds.
- Return to the LGU for the transfer of Tax Declaration.
- Submit the completed requirements to the Pag-IBIG Fund.
D. For refinancing
- Provide the LOG and Loan and Mortgage Agreement (LMA) to the financial institution owning the loan to be refinanced.
- Proceed to the Registration of Deeds for the annotation of mortgage.
- Submit the completed requirements to the Pag-IBIG Fund.
5. Receive loan proceeds from the Pag-IBIG Fund.
Upon completion of all requirements, the loan is released to the payee. The payee is either the borrower, the seller, or a third party the loan proceeds are assigned to be released to. The borrower/buyer assigns who the funds are released to.
Loans utilized for house construction or home improvement are released in staggered amounts based on the progress of the work being done.
For more information on Pag-IBIG home loans such as specific qualifications, additional documents, and maximum loan amounts, visit www.pagibigfund.gov.ph.
Main image via Shutterstock
| For a comprehensive guide on the rules, regulations, and functions of the Home Development Mutual Fund, as well as additional articles related to the HDMF, visit the Lamudi Pag-IBIG Fund page. |
