REFORMS in the Home Development Mutual Fund (Pag-IBIG) have ensured there will not be a repeat of the housing scam discovered in 2010 and members will enjoy more benefits, according to Vice President Jejomar Binay.
The Vice President, speaking at the National Capital Region Developers’ Forum on Wednesday, was referring to developer Globe Asiatique, which Pag-IBIG found to be allegedly using fake documents and ghost borrowers to secure P6.6 billion in loan from the mutual fund.
Among the reforms that Pag-IBIG instituted include centralization of approval of housing loan applications. The fund will now have the final nod on all applications, taking the task from the developers.
Pag-IBIG is also piloting the use of fixed loan-to-value (LTV) ratio, the amount of the loan divided by the appraised value of the property. This allows borrowers to avail of a bigger loanable amount compared to what they could get using the old system.
It is also seeking to improve documentation of loan applications. To be implemented next year, the process will enable developers to do away with Contracts-to-Sell and Deeds of Assignment, and issue only the Deed of Absolute Sale.
The enhanced method will expedite the processing of housing loan applications, eliminate foreclosure proceedings and save time and effort usually spent on such proceedings.
Under the Pag-IBIG reforms, new members may now apply for loans provided they were able to pay 24 months of lump-sum contribution.
Co-borrowers need not also be blood-related to the principal borrowers. Borrowers may also avail of “tacked loans,” which means that at most three borrowers may combine their gross monthly incomes to qualify for a bigger loanable amount.
The Vice President mentioned that should a member die, his/her family will get P20,000 death benefit from insurance aside from the P6,000 death benefit from Pag-IBIG and the insurance equivalent to the value of his/her housing loan.
Aside from being the head of the government housing sector, Binay also serves as Presidential Adviser on OFW (Overseas Filipino Worker) Concerns.
The reforms enabled Pag-IBIG to provide homes to close to half a million members since Binay and lawyer Darlene Berberabe took office as chairman and chief executive officer, respectively.
The Vice President noted that Pag-IBIG released P138 billion worth of loans for around 167,000 low-cost/economic housing units, and P19 billion for almost 60,000 socialized housing units.