Vol. XXII, No. 18 [ BusinessWorld Online ]
Wednesday, August 20, 2008 | MANILA, PHILIPPINES
A MEASURE that will give delinquent homeowners reprieve and allow them to keep their homes has been approved by a bicameral panel and is expected to be ratified by the House and Senate next week.
The measure, the proposed Socialized and Low-Cost Housing Loan Restructuring Act of 2008, will extend the payment period of housing loans contracted from government financial institutions (GFIs) and housing agencies, and in effect lower borrowers’ monthly amortizations, as well as forgive penalties and surcharges.
To benefit are homeowners of socialized and low-cost homes, who failed to pay monthly amortizations for at least three months.
Oriental Mindoro Rep. Rodolfo G. Valencia, chairman of the House committee on housing and urban development, said total loans to be restructured will amount to P66.69 billion, while beneficiaries number 368,535 homeowners nationwide.
The bicameral panel yesterday picked up from where they left off last week, and agreed to put the cap on interest rates on the restructured original principal at 12% or the original rate, whichever is lower, from the proposed 6%, giving in to calls from the Home Development Mutual Fund or the Pag-IBIG Fund for a higher rate.
"We cannot be expected to continue dipping into our reserved funds (to subsidize the interest payments)... Close to 90% of the loans have between 9% to 10% interest rate," said Pag-IBIG Fund President and Chief Executive Officer Romero Federico S. Quimbo.
Accounts qualified for the loan restructuring program are those where the original principal does not exceed P2.5 million.
"Those who will be covered can avail of the program only once so it should not encourage delinquencies," said Juan Miguel F. Zubiri, chairman of the Senate committee on urban planning, housing and resettlement.
Parañaque Rep. Eduardo C. Zialcita, vice-chairman of the House committee on housing and urban development, said waiving all penalties and surcharges will lessen the burden on poor borrowers.
Incentives, such as discounts on loan interest, will also be given to borrowers who pay prompt and religiously.
However, borrowers who avail of the loan restructuring program yet fail to pay three consecutive monthly amortizations risk losing their homes.
Mr. Quimbo said, "In pursuit of Congress to ease borrowers’ difficulties, we are more than willing to take that particular measure and embrace it."
"We are delighted by the act of Congress in coming to the aid of delinquent loan borrowers... for effective implementation of the government’s housing program," he added. — Bernard U. Allauigan
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