Making housing affordable for lower and middle-income earners
BASED on available statistics, middle-income earners constitute 23 percent of the labor force. Many of these middle-income earners do not own the house they reside in and part with a substantial portion of their income for house rentals. As they constitute a sizeable chunk of the population in need of housing, the government is providing opportunities for this sector to avail of housing loans. The decisions of the Pag-IBIG Fund to reduce interest rates from 9 to 7 percent opens the gate to middle-income earners to avail of housing finance.Under the new loan package, loans worth above P300,000 up to P700,000 will have an annual interest of only 7 percent, while loans under P300,000 will carry a 6 percent per annum interest. The new package was announced recently by Vice President Noli L. De Castro who is concurrent Chairman of the Housing and Urban Development Coordinating Council (HUDCC) and the Pag-IBIG Fund Board of Trustees.
The new round of reduced interest rates sustains the Pag-IBIG Fund’s thrust that started in 2006 to effectively address the affordability problem of the lower-income brackets that comprise about 77 percent of the work force. In addition to reduced interest rates, the Pag-IBIG Fund is streamlining loan procedures and requirements. To enhance the Fund’s viability, it will improve its collection efficiency and its return on investments, speed up the disposition of its acquired assets, improve organizational efficiency, and diversify income sources.
We commend the Pag-IBIG Fund for continually expanding the opportunities for the lower and middle income brackets to own their own homes.
