The government-owned Pag-IBIG Housing fund allocates a record high of Php 30B for low-cost housing due to the demands resulting out of the low interest rates. The average retail loan at Pag-IBIG is around Php 475,000 per borrower and based on this amount, they’re targeting a loan growth of around 28% this year. A challenge for Pag-IBIG, however, is to raise more funds to meet the increasing demands for low-cost housing.
Now is the best time to borrow from Pag-IBIG because you can get financing for low-cost houses at an interest of 6 or 7%, for a term that lasts up to 30 years. For a Php75,000 house at 7% a year, the monthly amortization will cost around Php4,000 to Php5,000, which is far more affordable than renting a house of the same quality (around Php10,000/month). Even OFWs can avail of Pag-IBIG loans now, especially those who are earning in currencies that are gaining against the dollar such as the euro.