The Pag-IBIG Bacolod Branch is encouraging its members to avail of the reduced interest rates for government housing loan packages.

Branch attorney Imelda Gerangaya said the new interest rates took effect last week of November and Pag-IBIG usually reviews the rates guidelines after six months.

Gerangaya said the advantage of borrowing from Pag-IBIG is that it offers lower interest rates compared to banks.

Loan packages up to P300,000 are charged an interest rate of 6 percent from the old rate of 9 percent, while for loans over P300,000 up to P500,000, it is from 10 percent to 7 percent.

For loans from P500,000 to P1 million, interest is down from 11 percent to 10.5 percent, and for P1 million up to the maximum of P2 million, from 12 percent to 11.5 percent. Based on these rates, monthly amortizations on loans valued at P300,000 have been reduced to P1,798.65 from P2,413.87 while for the P500,000 loan package, from P4,387.86 to only P3,326.

All housing loan packages have a maximum term of 30 years, but the borrower should not be more than 65 by the date of maturity.

Under the old guidelines loans over P750,000 up to P2 million had a maximum payment period of only 20 years.

The penalty for late payment is now only 1/20 of one percent of amount due for every day of delay whereas before, it was a two percent.

A borrower may also opt to pay more than his/her monthly amortization at a lower interest rate and the amount will be added to the principal loan amount.*NLG

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