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Copyright©2007 Social Housing Finance Corporation
Copyright©2007 Social Housing Finance Corporation
What is Localized Community Mortgage Program (LCMP)?
The Localized Community Mortgage Program (LCMP) is an innovative scheme whereby qualified partner-local government units (LGUs) may apply for an Omnibus Commitment Line (OCL) not exceeding P50-million. This is made available through the SHFC to accommodate priority social housing projects identified by the partner-LGUs.
The OCL is primarily for the purpose of acquiring the land occupied by their constituents, or on the land where they will be relocated. It is presumed that these projects have been enrolled by the partner-LGUs, and should espouse the concept of community ownership with the land primarily mortgaged to SHFC.
The Localized Community Mortgage Program (LCMP) is an innovative scheme whereby qualified partner-local government units (LGUs) may apply for an Omnibus Commitment Line (OCL) not exceeding P50-million. This is made available through the SHFC to accommodate priority social housing projects identified by the partner-LGUs.
The OCL is primarily for the purpose of acquiring the land occupied by their constituents, or on the land where they will be relocated. It is presumed that these projects have been enrolled by the partner-LGUs, and should espouse the concept of community ownership with the land primarily mortgaged to SHFC.
How can one avail of the LCMP?
The terms included in the Comprehensive Shelter Plan (CSP) of the LGU shall enable SHFC to release the necessary funds which will be equivalent to 75 percent of total land acquisition cost. The LGU shoulders the remaining 25 percent as counterpart share to the project that can be any of the following:
• Land owned by the LGU to serve as site of the project;
• Co-financing of the lot acquisition; and
• Site development and/or construction/improvement of residential units or Medium Rise Residential Buildings (MRRBs).
A beneficiary can avail of a maximum loan amounting to P80,000 for properties located in Metro Manila, and in other highly-urbanized areas; P45,000 for undeveloped properties; and P60,000 for developed properties located outside Metro Manila.
The terms included in the Comprehensive Shelter Plan (CSP) of the LGU shall enable SHFC to release the necessary funds which will be equivalent to 75 percent of total land acquisition cost. The LGU shoulders the remaining 25 percent as counterpart share to the project that can be any of the following:
• Land owned by the LGU to serve as site of the project;
• Co-financing of the lot acquisition; and
• Site development and/or construction/improvement of residential units or Medium Rise Residential Buildings (MRRBs).
A beneficiary can avail of a maximum loan amounting to P80,000 for properties located in Metro Manila, and in other highly-urbanized areas; P45,000 for undeveloped properties; and P60,000 for developed properties located outside Metro Manila.
What benefits can the LGU derive from LCMP?
The participating LGU is entitled from one percent to two percent processing fee depending on the viability of the project. The interest income derived from the minimum 25 percent counterpart share serves as an incentive for the partner-LGU.
The participating LGU is entitled from one percent to two percent processing fee depending on the viability of the project. The interest income derived from the minimum 25 percent counterpart share serves as an incentive for the partner-LGU.
What are the guaranty mechanisms that will secure the loan granted to the community association?
A combination or any of the following guaranty mechanisms are required from the LGU and CA: Assignment of receivables or internal revenue allotment; LGU guaranty from HGC or Local Government Unit Guarantee Corporation (LGUGC); and community fund equivalent to six months amortization of the LCMP loan.
A combination or any of the following guaranty mechanisms are required from the LGU and CA: Assignment of receivables or internal revenue allotment; LGU guaranty from HGC or Local Government Unit Guarantee Corporation (LGUGC); and community fund equivalent to six months amortization of the LCMP loan.
Who are the keyplayers of the LCMP?
Local housing partner
The partner-LGU shall accredit government agencies (GAs), non-government organizations (NGOs) and people organizations (POs) to act as its local partner and perform origination functions. They will assist the partner-LGU in the social preparation of the CA in terms of that are deemed necessary by concerned parties. The accredited housing partners are, in turn, accountable to the partner-LGU particularly on areas pertaining to origination.
Community association
A community association is composed of local informal settlers. They are legally identified as program beneficiaries, and can avail of a loan from SHFC through the partner-LGU.
The CA is responsible in maintaining itself as a viable organization, which implements financial discipline among its members. Among its responsibilities are: Setting up of a savings account known as the community fund equivalent to six months amortization; collection of monthly amortization from member-borrower/s, remittance to the LGU; accords appropriate penalties; and replaces defaulting MBs in coordination with the partner-LGU or its designated local housing partner.
Partner-LGU
Identifies urban poor communities and/or social housing projects in the area. These projects must be included in the annual investment plan approved by the city development council, and ratified, as well, by the city council.
The overall functions pertaining to the implementation of the LCMP are the following: Accreditation; examination of loan and mortgage documents; collection of monthly amortization; and individualization of accounts and titles.
The partner-LGU also puts up 25 percent of the total project cost as counterpart share, which maybe in any of the following: Land owned by the partner-LGU to serve as site of the project; co-financing of the lot acquisition; and its development and/or construction/improvement of residential units or MRRBs. It also allows representation and participation of the local housing partner; POs; NGOs; KSAs; and GAs.
Social Housing Finance Corporation
For its part, the SHFC releases the amount based on project-need and/or housing project’s development. The initial release shall not exceed 50 percent of the project value, or on pro-rated basis for turn-key project. The total amount for all projects shall not be more than 75 percent of the total project cost. Please note that the project cost is the total land acquisition cost for on-site, which will be funded under the LCMP.
Aside from providing a "special lane" for LCMP, the SHFC will also train LGU personnel involved in the processing of the social housing project. It will create a trust fund, wherein the OCL shall be deposited, and released to the landowner.
Local housing partner
The partner-LGU shall accredit government agencies (GAs), non-government organizations (NGOs) and people organizations (POs) to act as its local partner and perform origination functions. They will assist the partner-LGU in the social preparation of the CA in terms of that are deemed necessary by concerned parties. The accredited housing partners are, in turn, accountable to the partner-LGU particularly on areas pertaining to origination.
Community association
A community association is composed of local informal settlers. They are legally identified as program beneficiaries, and can avail of a loan from SHFC through the partner-LGU.
The CA is responsible in maintaining itself as a viable organization, which implements financial discipline among its members. Among its responsibilities are: Setting up of a savings account known as the community fund equivalent to six months amortization; collection of monthly amortization from member-borrower/s, remittance to the LGU; accords appropriate penalties; and replaces defaulting MBs in coordination with the partner-LGU or its designated local housing partner.
Partner-LGU
Identifies urban poor communities and/or social housing projects in the area. These projects must be included in the annual investment plan approved by the city development council, and ratified, as well, by the city council.
The overall functions pertaining to the implementation of the LCMP are the following: Accreditation; examination of loan and mortgage documents; collection of monthly amortization; and individualization of accounts and titles.
The partner-LGU also puts up 25 percent of the total project cost as counterpart share, which maybe in any of the following: Land owned by the partner-LGU to serve as site of the project; co-financing of the lot acquisition; and its development and/or construction/improvement of residential units or MRRBs. It also allows representation and participation of the local housing partner; POs; NGOs; KSAs; and GAs.
Social Housing Finance Corporation
For its part, the SHFC releases the amount based on project-need and/or housing project’s development. The initial release shall not exceed 50 percent of the project value, or on pro-rated basis for turn-key project. The total amount for all projects shall not be more than 75 percent of the total project cost. Please note that the project cost is the total land acquisition cost for on-site, which will be funded under the LCMP.
Aside from providing a "special lane" for LCMP, the SHFC will also train LGU personnel involved in the processing of the social housing project. It will create a trust fund, wherein the OCL shall be deposited, and released to the landowner.
