The Pag-IBIG Fund has lowered for the second time this year the interest rates on government housing loan packages, Pag-IBIG said in a press release over the weekend.

Loan packages up to P300,000 will now be charged an interest rate of 6.0 percent down from the old rate of 9.0 percent while for loans over P300,000 up to P500,000, from 10 percent to 7.0 percent.

For loans over P500,000 to P1 million, interest will decrease from 11 percent to 10.5 percent, and for over P1 million up to the maximum of P2 million, from 12 percent to 11.5 percent.

Pag-IBIG said that all housing loan packages will now have a maximum term of 30 years. Under the old guidelines loans over P750,000 up to P2 million had a maximum payment period of only 20 years.

New rates for loans up to P300,000 will benefit minimum wage earners, or those earning P7,700 a month, as well as government employees classified under Clerk III and Utility Worker. For P500,000 loans, employees classified as Teacher I and Police Officer I and even security guards are the target beneficiaries.

Under the new interest rates, monthly amortizations on loans valued at P300,000 will be reduced to P1,798.65 from P2,413.87 while for the P500,000 loan package, from P4,387.86 to only P3,326.

Vice President Noli de Castro, chairman of the Pag-IBIG Board of Trustees, said in the press release the Pag-IBIG Fund's strong financial performance in recent years make the interest rate adjustments possible.

He said that Pag-IBIG can implement the new interest rate structure without compromising its viability because it is very financially stable, it added.*

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