Pag-IBIG extends cash loan repayment terms to 3 years
MANILA, Philippines — The state-owned Home Development Mutual Fund or Pag-IBIG has eased its cash lending by extending its payment term to three years, its top officials announced last week.
In a statement Thursday, Pag-IBIG said it continues to improve its programs to meet the needs of its members.
“This year, we are extending the term of our cash loans from two to three years to give borrowers more time to repay their loans and, more importantly, to lower their monthly payments,” said Secretary Eduardo del Rosario, President of the Department of Human Settlements and Urban Development (DHSUD) and the 11-member Pag-IBIG Fund Board of Trustees.
Cash loans from the Pag-IBIG Fund come in the form of a Multi-Purpose Loan (MPL) and a Disaster Loan (CL) for areas in a state of disaster. Also known as Short Term Loans (STLs), MPL and CL are affordable and easily accessible sources of finance for their members.
According to the agency, qualifying members can borrow up to 80% of their total regular Pag-IBIG savings, which consists of their monthly savings, matching employer contributions and dividends earned annually.
The proceeds can then be used to pay for school fees, medical bills, minor home improvements, as capital for small businesses, or as an emergency fund during calamities.
“Pag-IBIG cash loans are repaid over 24 months. And now our members have the option to extend the term to 36 months. By choosing the longer payment period, members can enjoy significantly lower monthly payments,” Pag-IBIG Fund Managing Director Acmad Rizaldy Moti said.
He noted that they have reduced monthly payments by almost a third with the lengthening of the payment period. With an average cash loan of 20,000 pesos, members pay 1,016.52 pesos per month for a multipurpose loan and 897.23 pesos per month for a disaster loan with a payment term of two years.
However, with the new three-year payment term option, the amount of each monthly payment will be reduced to just P734.57 per month for a multi-use loan and P615.72 per month for a disaster loan. calamity.
Pag-IBIG said that with payments spread over a longer period, monthly payments were reduced by 28% for a multipurpose loan and 31% for a disaster loan.
“We recognize that times are difficult and we are doing everything we can to help our members as the health emergency continues. From January to July alone, we released 25.42 billion pesos in cash loans to help over 1.1 million members,” Moti said.
“We are ready to help more members in the coming months, now that the extended payment term has made our cash loans even more affordable. We have also made the loan application process safer and more convenient by accepting loan applications online through the virtual Pag-IBIG,” he added.
Pag-IBIG collects over P25B in savings in 2021
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