MANILA, Philippines – The state-owned real estate development pool or Pag-IBIG has eased its cash lending by extending its payment term to three years, senior officials said 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 reduce their monthly payments,” said Secretary Eduardo del Rosario, President of the Department of Human Settlements and Urban Development (DHSUD) and the Board of Directors of the Pag-IBIG Fund composed of 11 members.
The Pag-IBIG Fund’s cash loans are in the form of a multipurpose loan (MPL) and a disaster loan (CL) for disaster areas. Also known as Short Term Loans (STLs), MPL and CL provide affordable and easily accessible sources of funds for its members.
According to the agency, qualified members can borrow up to 80 percent of their total Pag-IBIG regular savings, which consists of their monthly savings, matching contributions from their employer 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 disaster fund.
âPag-IBIG cash loans are paid over 24 months. And now our members have the option to extend the term to 36 months. By choosing a longer payout period, members can benefit from significantly lower monthly payouts, âPag-IBIG Fund CEO Acmad Rizaldy Moti said.
He noted that they have reduced the 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 two-year payment term. .
However, with the new three-year payment term option, the amount of each monthly payment will be reduced to just P 734.57 per month for a versatile loan and P 615.72 per month for a disaster loan.
Pag-IBIG said that with payments spread over a longer period, monthly payments have been reduced by 28% for a multipurpose loan and 31% for a disaster loan.
âWe recognize that these are difficult times and we are doing all 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, âMoti said.
âWe are ready to help more members in the months to come, now that the extended payment deadline 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, âhe added.
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