State-owned Pag-Ibig Fund is offering a subsidized 4.5 percent interest rate for socialized housing loan of P400,000, which is ideal for minimum wage earners as this only requires P2,000 monthly amortization and double the maximum allowable loan under its regular housing loan program to P6 million from P3 million.
Atty. Darlene Marie B. Berberabe in a speech before the 33rd National Conference of Employers (NCE) said these two enhanced housing loan programs for accessible housing retail would be effective July 1 this year.
According to Berberabe, the 4.5 percent interest rate being offered by Pag-Ibig cannot be matched by the banking sector because this is subsidized by the government and is available only for its socialized housing program component.
"You cannot get this interest rate from any private bank and this is ideal for minimum wage earners because the monthly amortization is only P2,000," Berberabe said.
A P400,000 socialized housing loan will be charged with 4.5 percent interest rate for a monthly amortization of P2,026.74. A borrower is ex¬pected to have a gross monthly income of only P5,790.69.
A 6.5 percent interest would be charged on P750,000 loan. Borrowers are required a gross monthly gross in¬come of P13,544.31 to be able to pay the monthly amortization of P 4,740.51.
She said Pag-Ibig, the govern¬ment's premier provident institution, is able to subsidize the socialized housing loans through its theoretical income tax savings provided under Republic Act 9679, which exempted the agency from income tax payments.
For the regular housing loan component, Pag-Ibig has doubled the maximum allowable loan to P6 million from the previous P3 million. The in¬terest rate for regular housing loan is implementing a credit-scoring system for borrowers where they can adjust the rate based on the risk unlike before when the rate is pegged at 11.5 percent for a P3 million housing loan.
"This means that the lower the risk, the lower the interest rate," Berberabe said. The private banks are charging a range from 8-9, but Pag-Ibig would be charging lower than this range.
Berberabe has also reminded employers that its penalty condonation program for unregistered and delinquent employers and delinquent housing loan borrowers will expire on June 30 this year. (BCM)