In our last post, we have determined who are qualified to apply under the Pag-IBIG Housing Loan Program. Now let us talk about how much is the Pag-IBIG Loan Amount that can be applied for by the member.
How much can a member avail under the Pag-IBIG Housing Loan Program? Loan amount entitlement would depend on your monthly contribution.
Pag-IBIG has recently increased the highest possible loanable amount that members can avail, up to Php 6,000,000.00.
It must be noted however that the given loan entitlement amount will not automatically be granted to the borrower based on his/her contribution. This is simply a basis of the maximum allowable loanable amount that can be availed by category. There are three other considerations in securing a loan amount, which we will discuss in this installment in our series.
So how much is your Pag-IBIG Loan Amount?
The loan amount a member can apply for shall be based on the lowest of the following:
- Actual Need – the Pag-IBIG Fund will take into consideration how much is the actual amount needed for the housing loan. This may be the selling price of the unit or total construction cost if you are applying for the construction loan or the outstanding balance if you are applying for re-financing.
- Capacity to Pay – Pag-IBIG will compute the loan amount to be released to the borrower depending on his/her monthly income/salary. Pag-IBIG computes for a percentage of your income depending on the loan amount that you are applying for.
- 35% of your Gross Monthly Income, for loans up to P1,700,000
- 30% of your Gross Monthly Income, for loans over P1,700,000
- Loan-to-Appraisal Value Ratio – Pag-IBIG will conduct their own appraisal on the property that you are planning to apply for the loan.
These three considerations are taken into account when applying for a housing loan. Let us take the following example to illustrate how to determine your loan amount.
23 year old Member A has a monthly income of P30,000.00 and contributes P950.00 per month into his HDMF account. He is planning to apply for a two bedroom unit priced at P980,000.00 with an appraised loanable amount of P915,000.00.
- Contribution Catergory – Based on his contribution, Member A is entitled to P1.9M to 2M in loans.
- His actual need is P980,000.00 as that is the selling price of the unit.
- Capacity to pay – based on his salary, Member A is eligible for up to P1,600,000.00
- Loan-to-Appraisal Value Ratio – The house is appraised for a loanable amount of P915,000.00
Based on the above example, how much would be released to Member A? Pag-IBIG will choose the lowest amount and will approve Member A’s loan for P915,000.00, the appraised loanable value for the unit.
If you have any questions or clarifications on the topic, comment or send us a message! If you have any real estate related topics you want to us discuss, tag us in Facebook with #PropertyProINeedToKnow and we’ll talk about it here!
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Disclaimer: Please note that we are neither affiliated with the Pag-IBIG Fund nor experts on the housing loan process. These articles are written as a broad guide for would be borrowers. For any clarifications, contact your broker or directly inquire with Pag-IBIG.