PAG-IBIG Lowers Interest Rate

26th of June 2007, Wednesday

Good news for those planning to acquire their homes through Pag-ibig.

Here's an Inquirer report (by Cynthia Balana) that caught my eye:

Pag-IBIG Fund lowers loan rates

InquirerLast updated 06:58am (Mla time) 06/27/2007
MANILA, Philippines -- The Home Development Mutual Fund, popularly known as the Pag-IBIG Fund, has further lowered the interest rate on housing loans between P300,000 and P750,000 to seven percent, Vice President Noli de Castro said Tuesday.

The time Pag-IBIG cut interest rates on its housing loans was in November 2006.

De Castro, chair of the Housing and Urban Development Coordinating Council, said the rate reduction was meant to make housing truly affordable and accessible to ordinary workers.

He said the latest cut in interest rates targeted members in the middle-income bracket or those earning P16,000 to P20,000 per month.

He said this group constituted 23 percent of the labor force based on the statistics of the National Statistics Office.

“This is the next logical step to take. Remember that in November 2006, we already addressed the affordability issue of the lower income brackets, or 77 percent of the work force, when we reduced the rate from nine to only six percent per annum for a P300,000 housing loan,” De Castro said.

At seven percent, the monthly amortization, including principal and interest, is now down to P4,990 from P6,860 previously for housing loans of P500,000 to P750,000.

De Castro stressed, however, that carrying out “an honest to goodness interest reduction scheme” should also be complemented by streamlined loan requirements.

He directed Pag-IBIG Fund officials to look into the requirements of banks to see how the institution could further improve in this area.

Cynthia D. Balana

Link to the inquirer.net.