How to apply housing loan in Pagibig Fund (a.k.a. Home Development Mutual Fund)? What are the procedures and requirements? If you file the application now, how long would you wait? How much should you pay and how much are the current interest rates for this loan?
In this post, I’m gonna share about the process and steps in application of housing loan thru Pagibig Fund. I have attended a seminar in Pagibig recently as it one of the requirements before filing application.
I’m not affiliated with Pagibig but I am recommending it than availing housing loans on banks because the interest rates are lower.
One of the awesome benefits of being a Pagibig member is the Housing Loan. Everyone needs their own house sooner or later. Pagibig’s interest rates for this kind of loan are lower and cheaper compared to other housing loans and financing options offered usually by banks.
I’ve summed up the reasons why should you apply in Pagibig than any other housing loan provider. By the way, their online calculator is useful. I’ve shared the list of Pagibig housing loan application requirements here too.
Why You should Get Pagibig Housing Loan?
The benefits and advantages of choosing Pagibig housing loan than any other loan provider are as follows:
- Interest rate in Pagibig is lower and cheaper. Right now it starts with 7.785% per annum. Banks usually offer 10% and higher.
- Re-pricing of interest rates is lower too. It won’t go up or above 2% in case of inflation and other economic factors.
- It is easy and simple to apply provided you are eligible
- Approval process is fast and quick
Pagibig Housing Loan Eligibility
You must meet the following requirements before you apply for housing loan in HDMF.
- Must be a Pagibig active member and have contributed of at least 24 months of contributions. What if you already had the 24 months of contributions but you’re no longer an active member? Just resume being active and you can apply. What if you’re a new member? Pay lump sum payment to complete the required 24 months and submit the PFR (Pagibig Fund Receipt) upon filing of loan application.
- You must attend a seminar about the application of housing loan. They will discuss all the processing steps and they will tackle all requirements and points regarding your housing loan application.
- Submit 3 sets of the following requirements in folders:
Pagibig Housing Loan Application Requirements
1. Housing Loan Application Form – paste your recent 1X1 photo
2. Membership Status Verification Slip – attach photocopy of your 2 valid IDs
3. Proof of Income Documents:
For Locally Employed, any of the following:
- a. Notarized Certificate of Employment and Compensation (Employer’s Format) and for government employees 1 month payslip, within 3 months prior to the date of loan application
- b. Latest ITR for the year immediately preceding the date of loan application – attach W2 form, stamped received by the BIR/Certificate of Tax Withheld (BIR Form 2316)
For Self-employed / Other Sources of Income, any of the following:
- a. ITR, Audited Financial Statements and Official Receipt of Tax Payment from bank supported with DTI Registration and Mayor’s Permit/Business Permit
- b. Commission Vouchers reflecting the issuer’s name and contact details (for the last 12 months)
- c. Bank Statements or passbook for the last 12 months (in case income is sourced or derived from foreign remittances, pensions, etc.)
- d. Copy of Lease of Contract and Tax Declaration (if income is derived from rental payments)
- e. Certified True Copy of Transport Franchise issued by appropriate government agency (LGU for tricycles, LTFRB for other Public Utility Vehicle (PUVs)
- f. Certificate of engagement issued by owner of business
- g. Other document that would validate source of income or funds
For OFWs, any of the following:
- a. Employment Contract (with English translation if in foreign language)
- b. Original Employer’s Certificate of Income (with English translation if in foreign language). If document submitted is photocopy, it shall be duly certified/initiated by Pagibig Fund Information Officer assigned in the country where the member works.
- c. Other Proofs of Income, whether original or photocopy, shall be duly certified/initiated by Pagibig Fund information officer assigned in the country where the member works.
4. Photocopy (back-to-back) of 1 primary valid ID of Principal Borrower and Spouse, Co-borrower and Spouse, Seller and Spouse and Developer’s authorized representative and Attorney-in-Fact, if applicable.
5. Authorization to Conduct Credit/Background Investigation (download it here)
6. For OFWs, Special Power of Attorney notarized prior to date of departure or duly certified and authenticated by the Philippines Embassy or Consulate in the country where the member is staying, if abroad. If SPA is without the Red Ribbon of Consulate Office, the SPA must have duly stamped notarial seal.
7. Health Insurance Coverage
a. Health Statement Form (Medical Questionnaire)
- OFW members over 60 years old
- Loans over 2 Million pesos to 6 Million pesos and for borrowers aged up to 60 years old
b. Health Statement Form (Medical Questionnaire) and Full Medical Examination
- Borrowers over 60 years old
8. Marriage Contract (for all married borrowers, co-borrower/s, spouse, family member/s included on the computation of aggregate income)
9. Birth Certificate of or any proof of relationship, if with co-borrower/s or family member/s included on the computation of aggregate income.
10 Certified True Copy of Transfer Certificate of Title (TCT) – from Registry of Deeds
12. Photocopy of Updated Tax Declaration and Updated Real Estate Tax Receipt – from Municipal’s Assessor’s Office
13. Location Plan and Vicinity Map
14. Approved letter request to re-avail of a Pagibig housing loan – for members with housing loan that was foreclosed, cancelled, bought back due to default or subjected to dacion en pago).
Additional Requirements for the Type of Loan:
For Construction of House and Home Improvement:
- Building Plans, Specification and Bill of Materials duly signed by the Licensed Civil Engineer or Architect, Building Permit
For Refinancing
- Statement of Account on Outstanding Loan Balance, indicating loan purpose
- Any of the ff:
Official Receipt for the past 12 months
Subsidiary Ledger
Any valid proof of payment for the past 12 months
For Purchase of Lot or Adjoining Lots and Purchase of Residential Unit, Townhouse or Condominium Unit inclusive of a parking slot
- Contract to Sell or similar agreement between the buyer and seller. If the seller is a Developer, submit the following:
a. Certificate of registration, License to Sell, Development Permit, and Secretary’s Certificate
b. Photocopy (back-to-back) valid primary ID from Corporate Secretary
For Purchase of Lot and Construction of House
- Building Plans, Specification and Bill of Materials duly signed by the Licensed Civil Engineer or Architect, Building Permit
- Contract to Sell or similar agreement between the buyer and seller. If the seller is a Developer, submit the following:
a. Certificate of registration, License to Sell, Development Permit, and Secretary’s Certificate
b. Photocopy (back-to-back) valid primary ID from Corporate Secretary
Pagibig Housing Loan Interest Rates
Loan amount up to 6 Million
3 years – 7.985%
5 years – 8.895%
10 years – 9.750%
15 years – 10.375%
20 years – 11%
25 years – 11.5%
30 years – 12%
*source: HDMF* (Interest rates can change after the publication of this post)
Steps in Pagibig Housing Loan Application
After you have attended the seminar, you’ll be given the checklist of requirements. You must prepare all the documents in 3 set of copies and compile them in folders. Fill out all details correctly and honestly and make sure they’re all complete. Check your Pagibig MID Number. If you don’t have one yet, get it online.
You’ll be given Notice of Approval if your loan was approved. Congratulations then! They will contact you in case there are additional documents required. Cheques are given in 4-gives wherein the first 3 cheques would be the 30% amount of your loan and the last one will be the remaining 10%.
Tips in availing Pagibig housing loan:
Whatever loan you are availing, I advise you to borrow only the amount you are comfortable and affordable to pay. Consider your financial status and capacity to pay before you apply for a loan. If you can pay the loan in 3 years, choose 3 years. Otherwise choose the longer term.
Never underestimate interest rates. It is advisable to ponder on what you are dealing with. Use your calculator many times and verify your resources and assets. The best person who knows his eligibility to loan and to pay is himself.
