Pag-IBIG FUND Corporate Headquarters Petron MegaPlaza 358 Sen. Gil Puyat Ave., Makati City. Circular No. 335

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1 Pag-IBIG FUND Corporate Headquarters Petron MegaPlaza 358 Sen. Gil Puyat Ave., Makati City Circular No. 335 TO: ALL CONCERNED SUBJECT: IMPLEMENTING GUIDELINES FOR THE Pag-IBIG CALAMITY LOAN PROGRAM FOR MEMBERS AFFECTED BY TYPHOON YOLANDA Pursuant to the approval of the Pag-IBIG Fund Board of Trustees in its 299 th Board Meeting held last December 13, 2013, the following Implementing Guidelines for the Pag-IBIG Calamity Loan Program for Members affected by Typhoon Yolanda are hereby issued: I. OBJECTIVE The program aims to provide financial assistance to Pag-IBIG membervictims in calamity stricken areas, pursuant to the directive of the President of the Philippines (Memorandum Circular No. 59, Series of 2013). II. COVERAGE These guidelines shall be open to the following areas: ~ Provinces Aklan A -- Cebu E Leyte M ---- Northern Samar 1i~~=~~~;i~~~_e_n_ta_I_---1 P ~ City/Municipality Bacolod City 0umangas, Iloilo Baco, Oriental Mansalay, Oriental ---,--- - Puerto Princesa City, Palawan ~ _._ Janiuay, Iloilo j Bulalacao, Oriental Calapan City, Oriental N aujan, Oriental Pinamalayan, Oriental _._ _._ ' Areas not presently included in the above list may still be covered by these guidelines, provided that a Resolution has been issued by the Local Government, declaring such areas as calamity-stricken due to Typhoon Yolanda. 1

2 III. BORROWER'S ELIGIBILITY The program shall be open to a Pag-IBIG member who satisfies the following requirements: 1. Has made at least twenty-four (24) member's monthly savings (MS); 1.1 For members who have withdrawn their MS due to membership maturity, the reckoning date of the updated 24 MS shall be the first MS following the month the member qualified to withdraw his MS due to membership maturity; 2. Has one (1) MS for the last six (6) months as of month prior to date of loan application; 3. If with existing Pag-IBIG Housing Loan and/or MPL and/or Calamity Loan, the account must not be in default as of date of application; and 3.1 However, for accounts maintained by Tacloban branch the Pag-IBIG Housing Loan and/or MPL and/or Calamity Loan must not be in default as of last posting of payments. 4. His residence, whether present or permanent, or his place of work is directly affected by the Typhoon "Yolanda." IV. AVAILMENT PERIOD Availment of the benefits of these programs shall be within a period of ninety (90) days, retroactive from the declaration of state of national calamity, pursuant to Proclamation No. 682, Series of However, if the so" day falls on Saturday, Sunday or Holiday the member may file on the next working day. V. LOAN AMOUNT A qualified Pag-IBIG member shall be allowed to borrow an amount based on the lowest of the following: desired loan amount, loan entitlement, capacity-to-pay. 1. Loan Entitlement An eligible member shall be entitled to a loan amount which is equivalent to 80% of his Total Accumulated Value (TAV). 2. Capacity to Pay An eligible borrower's loan shall be limited to an amount for which statutory deductions, monthly repayment of principal and interest, and other obligations will not render the borrower's net take home pay to fall below the minimum requirement as prescribed by the General Appropriations Act (GAA) or company policy, whichever is applicable. 2

3 The member's net take home pay shall refer to the member's monthly compensation net of statutory deductions, other authorized deductions, outstanding loan obligations, and computed monthly repayment for loan being applied for. Statutory deductions shall refer to income tax withheld as well as contributions/premiums for GSIS/SSS, Pag-IBIG and PhilHealth. However, if the borrower has an existing MPL, the loanable amount shall be the difference between 80% of the borrower's TAV and the outstanding balance of his MPL. VI. INTEREST RATE The loan shall be charged interest based on the Fund's Risk-Based Pricing Framework for the entire duration of the loan including the grace period. VII. LOAN TERM The loan shall be repaid over a maximum period of twenty-four (24) months, with a grace period of six (6) months on which the first three (3) months are interest free. VIII. LOAN RELEASE The loan proceeds shall be released through any of the following modes: 1. Crediting to the borrower's cash card/ disbursement card; 2. Crediting to the borrower's bank account through LANDBANK's Payroll Credit Systems Validation (PACSVAL); 3. Check payable to the borrower; 4. Other similar modes of payment. IX. LOAN PAYMENTS 1. The loan shall be repaid in equal monthly payments in such amounts as may fully cover the principal and interest over the loan period. Said amortization shall be made, whenever feasible, through salary deduction. 2. Payments shall be remitted to the Fund on or before the fifteenth (15 th ) day of each month, starting on the seventh (ih) month following the date on the DV/Check. 3. The borrower may fully pay the outstanding balance of the loan prior to loan maturity. 4. The borrower shall pay directly to the Fund in case the borrower is unable to pay through salary deduction for any of the following circumstances, such as but not limited to: 3

4 ,. 4.1 Suspension from work; 4.2 Leave of absence without pay; 4.3 Insufficiency of take home pay at any time during the term of the loan. X. PEN AL TIES 1. A penalty of one-twentieth of one percent (1/20 of 1%) of any unpaid amount shall be charged to the borrower for every day of delay. 2. For borrowers paying through salary deduction, penalties shall only be reversed upon presentation of proof that non-payment was due to the fault of the employer. In such case, penalties due from the borrower shall be charged to the employer. Non-remittance of the total loan amortization shall likewise subject the employer with a penalty of one-tenth of one percent (1/10 of 1%) per day of delay of the amounts payable from the date the loan amortizations or payments fall due until paid. XI. APPLICATION OF PAYMENTS 1. Payments shall be applied according to the following order of priorities: 1.1 Penalties; if any, 1.2 Interest; and 1.3 Principal. 2. Accelerated Payments - any amount in excess of the required monthly amortization shall be applied to future amortizations. XII. DEFAULT The borrower shall be in default in any of the following cases: 1. Any willful misrepresentation made by the borrower in any of the documents executed in relation hereto; 2. Failure of the borrower to pay any three (3) consecutive monthly amortizations; 3. Failure of the borrower to pay any three (3) consecutive MS; 4. Violation by the borrower of any of the policies, rules, regulations and guidelines of Pag-IBIG Fund. 4

5 XIII. EFFECTS OF DEFAULT In the event of default, the outstanding loan obligation shall become due and demandable. The outstanding obligation shall be deducted from the TAV credited to the borrower. XIV. OTHER PROVISIONS 1. The Calamity Loan, MPL and Pag-IBIG HELPs shall be treated as separate and distinct from each other. Hence, the member shall be allowed to avail of a Calamity Loan while he still has an outstanding MPL and/or Pag-IBIG HELPs, and vice versa. Application for loans on these two programs shall be governed by their corresponding guidelines. In no case, however, shall the aggregate short-term loan exceed ninety percent (90%) of the borrower's TAV. 2. For borrowers with existing MPL at the time of availment of Calamity Loan, the outstanding loan balance of the MPL shall not be deducted from the proceeds of the Calamity Loan. 3. For borrowers whose residence or place of work is affected by Typhoon Yolanda and whose application for Calamity Loan (Circular No. 322) has been approved prior to the effectivity of these guidelines, the grace period and due dates of their respective Calamity Loans shall be adjusted pursuant to these guidelines 4. Loan Renewal Should another calamity occur in the same area, a borrower may renew his calamity loan but it shall be processed in accordance with Circular No The outstanding balance of his existing loan, together with any accrued interests, penalties and charges, shall be deducted from the proceeds of the new loan. 5. Membership Termination In the event of membership termination prior to loan maturity, the outstanding loan obligation shall be deducted from the borrower's TAV and/or any amount due him or his beneficiaries in the possession of the Fund. In case of borrower's death, the outstanding obligation shall be computed up to the date of death. Any payments received after death shall be refunded to the borrower's beneficiaries. 6. Multiple Employers 6.1 An eligible member who is an active member under more than one employer shall have only one outstanding Calamity Loan at any given time. 6.2 At point of application, the member shall choose which employer shall deduct and remit his monthly Calamity Loan amortizations. 5

6 >.' 7. Immediate Offsetting against the Borrower's TAV Offsetting of the borrower's outstanding Calamity Loan obligation against his TAV shall be effected immediately upon approval of the borrower's request; provided, such request is based on any of the following justifiable reasons and has been verified by the Fund: 7.1 Borrower's unemployment; 7.2 Illness of the member-borrower or any of his immediate family members as certified by a licensed physician that, by reason thereof, resulted in his failure to pay the required amortizations when due; 7.3 Death of any of his immediate family members that, by reason thereof, resulted in his failure to pay the required amortizations when due. 8. Availment of Calamity Loan after TAV Offsetting If TAV offsetting has been effected on the borrower's defaulting Calamity Loan, he may apply for a new Calamity Loan subject to the following conditions: 8.1 If the borrower has paid at least 6 monthly amortizations prior to default and its consequent offsetting against the borrower's TAV, the borrower may immediately apply for a new loan, subject to the eligibility criteria provided in these guidelines; 8.2 If the borrower has paid less than 6 monthly amortizations prior to default and its consequent offsetting against the borrower's TAV, the borrower may apply for a new loan only after two (2) years from date of TAV offsetting, subject to the eligibility criteria provided in these guidelines. XV. ESCALATION OF ISSUES Any issue in the interpretation and implementation of these guidelines shall be resolved by the Department Manager III concerned or shall be escalated to the next higher approving authorities. XVI. AMENDMENTS The Senior Management Committee may amend, modify or revise the provisions of these guidelines provided, the amendments, modifications and revisions thereof, are in furtherance of the objectives of this program and consistent with the mandate of the Fund under its charter and existing laws. 6

7 ,,, XVII. APPLICABILITY These guidelines shall apply to Calamity Loan accounts approved on the 11th day of November 2013 and onwards. XVIII. EFFECTIVITY These guidelines shall take effect immediately. ~~~ ATTY. DARLENE MARIE B. BERBERABE Chief Executive Officer Makati City JAM