<= span style=3D'font-size:32.0pt;font-family:"TimesNewRomanPS-BoldMT","serif"; mso-bidi-font-family:TimesNewRomanPS-BoldMT;color:#943634;mso-themecolo= r: accent2;mso-themeshade:191'>Rescue package for housing

loan borrowers= now in effect

More than 418,000 families in danger of losing their

homes in these hard times may now avail of a lifeline

offered by the government.

The Socialized and Low-Cost Housing Loan Restructuring

Act of 2008, or Republic Act No. 9507, signed by President<= /o:p>

Gloria Macapagal-Arroyo October last year, became

effective on March 16.

Vice President Noli “Kabayan” De Castro, chairman of

the Housing and Urban Development Coordinating Council

(HUDCC), said that borrowers with delinquent loans with

any government financing institution (GFI) or housing=

agency may now begin applying for loan restructuring and

condonation under the new law.

The p= rogram covers borrowers and installment buyers

of agencies involved in the National Shelter Program,=

including Government Service Insurance System (GSIS),=

the Social Security System (SSS), the Home Development

Mutual Fund (HDMF) or Pag-IBIG Fund, the National

Home Mortgage Finance Corporation (NHMFC), the Social=

Housing Finance Corporation (SHFC), the Home Guaranty=

Corporation (HGC), and the National Housing Authority=

(NHA), whose original loan accounts do not exceed P2.5

million and are in arrears for at least three months.

̶= 0;This program was specifically created to help out those

borrowers who have fallen behind on their mortgage

payments and are in danger of losing their homes because

of financial difficulties,” De Castro said.

The p= rogram lightens the burden of troubled borrowers in

several ways.

First= , it saves them from the heavy burden of having to

pay the accumulated penalties and surcharges that have

been imposed from unpaid amortizations. All of these shall<= /o:p>

be condoned upon approval of their application.

Second, the new program allows the lending GFI or

housing agency to condone a portion of the unpaid interest,=

the amount or percentage of which shall be determined by

the board of the concerned GFI or housing agency.

̶= 0;This is a provision that was not present in previous

loan restructuring and condonation programs, where only

penalties are condoned. This gives leeway to the lending

GFI or housing agency, without jeopardizing their long-term=

financial stability, to further reduce the financial burden on

the borrowers,” De Castro said.

Third= , the remaining accrued interest shall be paid in

equal installments during the term of the restructured loan=

without any interest.

Fourth, the restruct= ured loan shall be imposed an interest

rate not high= er than that of the original loan, or 12 percent,

whichever is = lower.

Fifth, the payment p= eriod of the restructured loan may be

lengthened up= to a maximum of 30 years from the approval

of the applic= ation to lower the monthly amortization.

However, the = loan term may only be extended up to the

borrower̵= 7;s age of 70.

Sixth, borrowers who promptly pay their loan

amortizations= may also be given incentives such as

reasonable di= scount on interest, to be determined by

the GFI or ho= using agency.

The Vice President s= aid this program is good for both

borrowers and lending institutions, “especially during

these times w= hen the economy is down.”

“On the one ha= nd, it saves borrowers from having

their homes foreclosed and joining the ranks of the

homeless. On = the other hand, the GFIs and housing

agencies can = also get their non-performing loans

moving again = and improve their cash flow,” he said.

Borrowers may avail = of the loan restructuring

program withi= n 18 months from the effectivity of the

program..

Frequently Asked Questions (FAQs)

Q: What are the covered accounts of this Program?

A: The Program shall cover loans/obligations of delinquent

home borrowers/installment buyers of all agencies involved in

the National Shelter Program (NSP) of t= he government,

including, but not limited to, the Government Service

Insurance System (GSIS), the Social Security System (SSS),

the Home Development Mutual Fund (HDMF)= or Pag-IBIG

Fund, the National Home Mortgage Finance Corporation

(NHMFC), the Social Housing Finance Corporation (SHFC),

the Home Guaranty Corporation (HGC), and the National

Housing Authority (NHA), collectively k= nown as the

Government Financial Institutions (GFIs) and housing

agencies, with three (3) unpaid monthly amortizations/

payments as of 16 March 2009 provided t= hat the original

principal amount of the housing loan/obligation shall not

exceed P2.5 million.<= /i>

The Program shall also cover delinquent accounts of

community/homeowners associations/group loans and local government unit (LGU) projects financed by NHA thru loan agreements provided the principal amount of an individual member’s = loan does not exceed P2.5 million.

Q: Can a borrower who had already avail= ed of the

Benefits of a previous condonation or restructuring

program still avail of the benefits of = this Program?

A: Yes. The borrower who had already availed of the benefits

of a previous condonation or restructur= ing program can still avail of the benefits of this Program.

Q: How many times may one avail of the benefits of this

Act?

A: This condonation and loan restructur= ing may be availed of

only once, except in case of force maje= ure, which prevents the

borrower from performing his/her financ= ial obligation under

the contract.

Q: How many will benefit from this Prog= ram?

A: More than 418,000 delinquent housing loan borrowers shall

benefit from this Program.

Q: How can a borrower avail of the Prog= ram and where

will he/she go?

A: The borrower/installment buyer, legal heir or successor-in-interest shall file the application for the Program = with the Head Offices of the GSIS, SSS, HDMF/Pag-IBIG Fund, NHMFC, SHFC, HGC, = and NHA or with any of their authorized offices.

A Special Power of Attorney (SPA) shall= be accepted only in

cases when the party is working overseas and the SPA

presented has been executed and duly notarized prior to

his/her departure from the country or d= uly authenticated by

the Philippine Consul in the foreign country, or when the

applicant is physically incapacitated as evidenced by a

Medical Certificate.<= /i>

Q: How much will a borrower have to spe= nd as cash-out

In order to avail of the benefits of th= is Program?

A: The delinquent borrower/installment buyer, legal heir or successor-in-interest applying for condonation and l= oan restructuring shall not be charged a processing fee and no down payment s= hall be required.

However, the insurance coverage of restructured obligations

shall be subject to the policies of the respective Boards of the

GFIs and housing agencies.

Q: Can a borr= ower pay the amount in full?

A: Yes. The borrower can pay the arrearages and the balance

loan amount in full.

Q: How will t= he restructuring and condonation be implemented?

A: The condon= ation and restructuring shall be implemented as

follows:=

a. All penalt= ies and surcharges shall be condoned upon approval

of the application. With r= espect to the accrued interest on the

housing loan, a portion th= ereof shall also be condoned.

However, the amount or percentage of the interest to be

condoned shall be determin= ed by the respective boards of the

GFIs and housing agencies.=

b. All remain= ing accrued interest shall be treated as non-interest

bearing component to be pa= id in equal monthly amortizations

during the term of the restructured obligation.

c. The intere= st bearing portion of the restructured obligation

shall be imposed an intere= st rate of not more than the interest

of the original loan or tw= elve percent (12%), whichever is lower.

Q: What is the maximum term for the restructured obligation?

A: The maximu= m term of the restructured obligation shall be

thirty (30) years reckoned= from the date of approval of

application for condonatio= n and loan restructuring. In no

instance, however, shall t= he loan term exceed the difference

between the borrower’= ;s age at the time of application and age

seventy (70).

Q: What happe= ns if a borrower could not avail of the

Program?=

A: The GFIs a= nd housing agencies shall continue to exercise

Their rights = to foreclose the mortgage or cancel the Contract to

Sell/Deed of Conditional Sale/Conditional Contract to Sell.

Q: How will t= he foreclosure of mortgage of delinquent

accounts be implemented?

A: In case of foreclosure of mortgage of delinquent accounts

mentioned in = the previous question, the foreclosure proceedings

shall be exem= pt from publication in newspapers of general

circulation, subject however, to the following conditions:

a. The date a= nd place of auction sale shall be posted for not

less than twenty (20) days= in at least three (3) conspicuous

public places in the city = or municipality where the property is

situated.

b. It shall be subject to other applicable provisions of R.A. No.<= /p>

3135, as amended, otherwise known as an “Act to Regulate

the Sale of Property under Special Powers of Attorney

Inserted In or Annexed to = Real Estate Mortgages”.

c. A written = notice of foreclosure shall be sent to the borrower at

his/her last known address= .

Q: Upon restructuring, what happens when the borrower defaults?=

A: An account= shall be considered in default, if the borrower fails to pay three (3) consecut= ive monthly amortizations/payments. In such cases,the GFIs and housing agenci= es may pursue foreclosure proceedings or cancellation of Contract-to-Sell/De= ed of Conditional Sale/Conditional Contract to Sell proceedings on the prope= rty, in accordance with the remedies against delinquent accounts as provided in the IRR.

<= o:p>

Q: How much a= re the penalty charges on delayed payments

Of the restru= ctured obligation?

A: Penalty ch= arges on any delayed payment on the monthly

amortization/= payment of the restructured obligation shall be

subject to the policies of the respective Boards of the GFIs

and housing a= gencies to be determined within 30 days from

the effectivi= ty of the IRRs.

Q: In case of permanent physical incapacity of the borrower, can the restructured accou= nt of such borrower be continued?

A: In case of permanent physical incapacity of the borrower/

installment b= uyer, his/her successors-in-interest may assume payment of his/her outstanding loan.

In case of de= ath of the borrower/installment buyer, the proceeds

of the MRI sh= all be fully applied to his/her outstanding obligation.

Any balance l= eft of the obligation may be assumed by his/her

legal heirs.T= he legal heirs and successors-in-interest must pass

the GFIs̵= 7; and/or housing agencies’ eligibility requirements before=

they are allo= wed to assume payment of the borrower’s/installment<= /p>

buyer’s obligation.

Q: Is this restructuring and condonation program the same

or similar to= the ones already being implemented by the

GFIs and hous= ing agencies?

A: The Program shall be construed as separate and distinct from

the existing condonation and loan restructuring programs being

implemented b= y the respective GFIs and housing agencies and

the borrower/= installment buyer shall be given the option to choose which condonation and loan restructuring program he/she may avail of.

Q: Can the sa= vings of the member with GSIS, SSS and

HDMF/Pag-IBIG= Fund be used to pay for his/her arrearages?

A: Yes. The G= SIS, SSS and HDMF/Pag-IBIG Fund may allow

The borrower-= applicant to use the total accumulated value of

his/her membe= rship contribution or savings only to update

his/her housi= ng payments.

Q: Which acco= unts are not covered by this Act?

A: The follow= ing housing loan accounts are not covered under

this Act:

a. Any account without a single payment since take-out/effectivity=

of contract to sell/deed of conditional sale/conditional contract

to sell;=

b. An account= which housing unit has been abandoned by the

borrower-owner for more th= an one (1) year from the date of

delinquency;

c. An account= which housing unit is occupied by a third party

other than the original registered beneficiary or his/her legal

heirs/successor-in-interes= t;

d. An account= that has been foreclosed and the redemption

period has already lapsed;=

e. An account= under a contract-to-sell that has been cancelled;

f. An account= that has been surrendered to the GFIs or housing

agencies through a dacion = en pago, the title of which has

already been consolidated/transferred in the name of the GFIs

or housing agencies; and

g. HDMF/Pag-I= BIG Fund contract-to-sell accounts covered by

the developers’ buy-= back guaranty

_____________= __________________________________________

<= o:p>

Partic= ipating Agencies:

GSIS - 976.46.26 www.gsis.gov.ph; SSS - 924.78.49 www.sss.gov.ph;

HDMF/Pag-IBIG - 848.82.60 www.pagibigfun= d.gov.ph

NHMFC - 817.56.93 www.nhmfc.gov.ph; SHFC <= /i>- 893.43.71 www.shfcph.com;

HGC - 890.54.66 www.hgc.gov.ph; NHA - 922.30.07 www.nha.gov.ph;

_____________= __________________________________________