You’ve been eyeing a house and you’ve wanted to buy it for some time now. You managed to save some money, but still not enough to pay the full price of the property. The best option right now might be to get a loan. Why not avail of a PAG-IBIG housing loan?
Here’s everything you need to know about the PAG-IBIG housing loan — from the list of requirements to the application process to the interest rate that will be charged on your loan. These are updated and valid for the year 2020.
Good news! PAG-IBIG even lowered the interest rate from 5.375% to 4.985% per year for a 1-year repricing loan. Take note: this low-interest rate promo is valid until the end of December 2020 only.
Continue reading to find out the PAGIBIG home loan requirements and, who knows, you might be able to buy and own that dream house of yours this year!
The Home Development Mutual Fund of the Philippines, more commonly known as PAG-IBIG, has been one of the usual options of Filipinos when looking for an affordable home loan.
Fortunately for members, PAG-IBIG has recently simplified the application steps and reduced the application requirements to make it easier for you to get a PAG-IBIG home loan! Check it out below.
Of course, we all know that you can get a Pag-IBIG housing loan if you want to purchase a house, house and lot, or even a condo unit. But did you know that a Pag-IBIG loan can be used for other housing-related purposes as well, including buying a parking slot or renovating your current home?
Here’s a list of cases that can be financed by a PAG-IBIG housing loan.
1. Purchase of a fully developed residential lot or adjoining residential lots, not exceeding 1,000 square meters, which should be within a residential area;
2. Purchase of a residential house and lot, townhouse or condominium unit, inclusive of a parking slot, which may be:
Take note that the the subdivision project where said residential units are located must have complied with all required facilities pursuant to BP No. 220, or the law on Economic and Socialized Housing in the Philippines.
3. Construction or completion of a residential unit on a residential lot owned by the borrower or a relative of the borrower based on accommodation of mortgage;
4. Home improvement on the house owned by the borrower, such as alteration/s in an existing residential unit intended by the borrower to be a permanent integral part thereof, which will enhance its durability and material value;
5. Refinancing of an existing housing loan with an institution acceptable to the Fund, provided that, the account is updated at least one (1) year old upon application as supported by the borrower’s official receipts or by a Statement of Account issued by the financing institution signed by the Manager or Account Officer.
6. Combination of loan purposes, which shall be limited to the following:
7. Combination of loan purposes plus cost of transfer of title, which shall be limited to the following:
Purchase of residential unit and transfer of title in favor of the retail borrower;
If your housing needs is one of the reasons listed above, you may decide to take out a loan from Pag-IBIG. But are you eligible? Check below if you satisfy the following requirements and conditions.
1. Of course, first and foremost, you must be a Pag-IBIG member. Specifically:
2. Not more than sixty-five (65) years old at the date of loan application and must be insurable; and not more than seventy (70) years old at loan maturity;
3. Has the legal capacity to acquire and encumber real property;
4. Has passed satisfactory background/credit and employment/business checks of Pag-IBIG Fund;
5. If with existing Pag-IBIG housing account, either as principal or co-borrower, said loan must be updated;
6. Has no outstanding Pag-IBIG short-term loan in arrears at the time of loan application;
7. Had no Pag-IBIG housing account that was foreclosed, cancelled, bought back due to default, or subjected to dacion en pago.
Interested to apply? Here are the documents and requirements that you need to submit to be able to avail of a Pag-IBIG Housing Loan.
1. Two (2) copies of Pag IBIG Housing Loan Application. You may get this from any PAGIBIG office and you need to attach a recent photo of the borrower/co-borrower.
2. One (1) valid ID. In your application, attach a photocopy (back-to-back) of a valid government-issued ID of the Principal Borrower and Spouse, Co-Borrower and Spouse, Seller and Spouse and Developer’s Authorized Representative and Attorney-In-Fact, owner of title (for Accommodation Mortgage), if applicable.
3. Special Power of Attorney (SPA), only for OFWs. Overseas Filipino Workers (OFW) currently in the Philippines during application must submit an SPA notarized prior to date of departure. For OFW member abroad, an SPA notarized by a Philippine Consular Officer, or SPA notarized by a local notary (of the country where the member is working) and duly authenticated by the Philippine Consulate, must be submitted.
4. Certified True Copy of the latest Transfer Certificate of Title (TCT) of the property. For Condo Units, the applicant must present TCT of the land and Certified True Copy of the Condominium Certificate of Title (CCT).
5. Latest Tax Declaration (Tax Dec) of the property.
6. Photocopy of latest Real Estate Tax receipts. This is the annual amilyar paid on the property.
7. Vicinity Map or location sketch of the property.
8. Health Statement Form or Medical Questionnaire. If the borrower is aged more than 60 years old or, if below 60 years old but the loan amount is from P2 million to P6 million, a completed health statement form or medical questionnaire is required to be submitted.
If the borrower is an OFW and over 60 years, aside from the health statement form, a copy of the result of medical examination conducted prior to assignment overseas as required by the employment agency must also be submitted.
In addition to the basic requirements above, applicants must also submit the following “Proof of Income” documents depending on their employment type or source of income.
A. If you are employed in the Philippines, any of the following may be submitted as Proof of Income:
B. If you are self-employed in the Philippines, any of the following documents are accepted as Proof of Income:
C. If you are an Overseas Filipino Worker (OFW), any of the following may be submitted as Proof of Income:
1. Employment Contract
2. Certificate of Employment and Compensation (CEC)
3. Income Tax Return filed with Host Country/Government
Prepare the following documents because Pag-IBIG may require OFW applicants to submit any or all of the following:
NOTE: If any of the above are in foreign language/s, English translation of the document is required.
Upon loan approval, the borrower must submit these additional documentary requirements in order for the loan amount to be released.
Here’s an infographic summarizing the application steps that you need to undergo if and when you’ll apply for a Pag-IBIG housing loan. Details of each step are also explained below.
Download or secure a copy of the Housing Loan Application (HLA) which you must fill out in two (2) copies.
You may also complete the application form online (via www.pagibigfund.gov.ph) but you still need to print the copies and you have to choose a scheduled date of submission that you will visit your preferred Pag-IBIG branch.
With your HLA (2 copies) and other required documents on hand, go to any Pag-IBIG branch to submit the requirements. You are also required, at this stage, to pay the P1,000 processing fee and P2,000 appraisal fee, plus the remainder of the lump-sum Membership Savings (assuming you haven’t completed the required 24 MS).
Get the Pag-IBIG Fund Receipt (PFR) and Payment Order Form (POF) after you have paid. Photocopy the PFR and submit 1 copy to Pag-IBIG’s Mortgage Loans Specialist/ or Member Services Officer. You will then be given a copy of the Housing Loan Application Acknowledgement Receipt (HLAAR) which serves as your proof of received application.
Within six (6) working days from the submission of your application, you will receive a call or notice from Pag-IBIG regarding the results of Credit Investigation and Property Appraisal.
This is not yet about the results of your loan application, but more on the results of evaluation regarding your credit-worthiness or your ability to pay the monthly amortizations.
If you passed the Credit Investigation (CI), you will then receive another call this time regarding the schedule of the appraisal of the property. After the property appraisal, this is the time you will be informed if your housing loan is approved or disapproved.
If approved, you will be asked to visit the Pag-IBIG office to receive and sign the following documents:
Take note, at this point, you’re still not yet going to receive the loan proceeds. You will be required to submit all documents identified in the NOA. You are given ninety (90) days or three (3) months to submit all requirements, although of course, the earlier you submit the documents, the earlier you can also get the money you need.
Once you have completed and submitted all required documents, congratulations! The loan proceeds check will now be prepared. To pick up the check, you must present two (2) valid IDs plus either of the following which will authorize the payment of your monthly loan amortization:
Unfortunately, applying for a PagIBIG housing loan is not free. Applicants are required to pay the following upon submission of the loan application:
Upon loan take-out, the following fee is charged:
The actual time it will take to process and release your loan proceeds will depend on when you will be submitting all required documents. All in all, though, assuming you’re able to submit all required documents within just one or two days, you can expect the loan proceeds to be released within one (1) month!
As per Pag-IBIG, for transactions that they will perform on their part, it will take them the following processing times:
| Transaction | Processing Time |
|---|---|
| From receipt of documents required upon Loan Application up to endorsement of documents for Credit Investigation and Property Appraisal | 2 working days |
| From receipt of endorsed documents up to generation of the result of Credit Investigation and Property Appraisal | 6 working days |
| From receipt of the result of Credit Investigation and Property Appraisal up to approval of Loan Application | 8 working days |
| From receipt of approval of Loan Application up to release of Notice of Approval (NOA) | 1 working day |
| From preparation of Request for Payment (RFP) up to Check availability | 3 working days |
The key, therefore, to getting the loan proceeds released as soon as possible is to submit all complete and correct requirements. Get details from the Pag-IBIG staff regarding the documents that you’re supposed to submit so that you won’t have to go back and forth the Pag-IBIG fund office and for the processing of your application to not be delayed.
Here are the latest published interest rates that Pag-IBIG charges on their housing loans. These interest rates are charged annually, and would vary depending on the fixed pricing period that you will choose.
| Fixed Pricing Period | Interest Rate per Year |
|---|---|
| 1 Year | 4.985% |
| 3 Years | 5.375% |
| 5 Years | 6.375% |
| 10 Years | 7.270% |
| 15 Years | 8.035% |
| 20 Years | 8.585% |
| 25 Years | 8.800% |
| 30 Years | 9.050% |
The interest rates are explained in detail, with sample computation of monthly amortization, in this article: PAGIBIG Housing Loan Interest Rates
If you have questions or clarification, visit or contact a Pag-IBIG office near you. Hope you can own your dream property soon!
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Pinoy Money Talk is an educational website about money, banking, investments, and personal finance which started in 2005. Its group of five writers consists of one equity research analyst, one fintech startup owner, one finance educator, and two investment professionals.
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