De Castro urges delinquent housing borrowers to avail selves of restructuring

Published by rudy Date posted on March 18, 2009

Borrowers with delinquent loans from any government financing institution (GFI) or housing agency may now apply for loan restructuring and condonation under a new program that aims to save their homes from foreclosure, Vice President Noli de Castro, chairman of the Housing and Urban Development Coordinating Council (HUDCC), announced yesterday.

De Castro said the Socialized and Low-Cost Housing Loan Restructuring Act of 2008, or Republic Act 9507, which took effect on March 16, covers home borrowers and installment buyers of 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 Corp. (NHMFC), the Social Housing Finance Corp. (SHFC), the Home Guaranty Corp. (HGC), and the National Housing Authority (NHA), whose original loan accounts do not exceed P2.5 million each and are in arrears for at least three months.

“The program was created to help borrowers who have fallen behind in their mortgage payments and are in danger of losing their home because of financial difficulties,” the Vice President said.

It eases the borrowers’ burden by condoning all accumulated penalties and surcharges that have been imposed from unpaid amortizations.

It also allows the lending GFI or government agency to condone a “reasonable portion” of the unpaid interest, the amount or percentage of which shall be determined by the respective boards of the lending institutions.

“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 agency, without jeopardizing their long-term financial stability, to further reduce the financial burden on the borrowers,” De Castro said.

The remaining accrued interest shall be paid in equal installments during the term of the restructured loan without any interest. The unpaid principal of the loan shall be imposed an interest rate not higher than that of the original loan, or 12 percent, whichever is lower.

To further lower the monthly amortization, the payment period of the restructured loan may be lengthened up to a maximum of 30 years from the approval of the application, without exceeding the borrower’s age of 70.

Borrowers who promptly pay their loan amortizations may also be given incentives, such as reasonable discounts on interest, to be determined by the GFI or housing agency.

De Castro hailed the program as a benefit for both borrowers and lending institutions, “especially in this time of economic downturn. On the one hand, it saves borrowers from having their homes foreclosed and joining the ranks of the homeless. On the other hand, the GFIs and lending agencies can get their non-performing loans moving again and improve their cash flow,” he said.- Tribune

April – Month of Planet Earth

“Full speed to renewables!”


Solidarity with CTU Myanmar,
trade unions around the world,
for democracy in Myanmar,
with the daily protests of
people in Myanmar against
the military coup and
continuing oppression.


Accept National Unity Government
(NUG) of Myanmar.
Reject Military!

#WearMask #WashHands

Time to support & empower survivors.
Time to spark a global conversation.
Time for #GenerationEquality to #orangetheworld!
Trade Union Solidarity Campaigns
Get Email from NTUC
Article Categories