[ journal .com.ph ] May 29, 2008
Senator Loren Legarda yesterday urged the Senate to conduct an investigation into the “massive foreclosure of low cost and socialized real estate mortgages sold by the government housing finance agencies to a private corporation” which threatened to throw out thousands of families from their homes.
In Philippine Senate Resolution (PSR) 419, Loren disclosed that thousands of affected families have expressed fears of losing their low-cost housing units through massive foreclosures resulting from the “stringent repayment terms” imposed by the Balikatan Housing Finance Corporation (BHFC), the private firm.
Among those affected are residents in five subdivisions in Davao City, namely, San Lorenzo Village, El Rio, Rosalina, Kadayawan and Country. They complained that the firm was demanding the payment of the full amount of their arrears within three months or face reappraisal of their outstanding loans to as much as three hundred percent (300%) of the original amount.
Since most of these low-cost housing residents cannot afford the terms imposed by the private firm, they expressed fear that they might be evicted from their homes for which they have already paid substantial sums. Loren said that this is contrary to the state policy of providing socialized housing.
Loren explained that between 1988 and 1996, approximately 220,000 housing loans were extended by the National Home Mortgage Finance Corporation (NHMFC) through its Unified Home Lending Program or UHLP, which was established to meet the housing finance needs of members of public pension fund systems, namely, the GSIS, SSS and Pag-IBIG.
“In 1996, the NHMFC’s collection levels dropped below 65% of scheduled payments. In the succeeding years, collections continued to decline, and by 2002, NHMFC’s accrued loans reached 53 billion pesos,” she noted.
Because of the low repayment rates and huge amounts of uncollected loans, the state-controlled housing finance agencies were prompted to dispose and restructure their loan portfolio with the cooperation of the private sector, Loren stated.
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