In the Philippines, the Home Development Mutual Fund (HDMF), popularly known as the Pag-IBIG Fund, is mandated by Republic Act No. 9679 (the Home Development Mutual Fund Law of 2009) to provide affordable shelter financing and short-term loans to Filipino workers. The "Salary Loan," officially termed the Multi-Purpose Loan (MPL), serves as a social security mechanism designed to provide financial assistance for immediate needs.
I. Legal Eligibility Requirements
To qualify for a Pag-IBIG Multi-Purpose Loan, a member must satisfy the following criteria under existing Fund guidelines:
- Active Membership: The member must have made at least twenty-four (24) monthly mandatory savings (MS).
- Recent Activity: The member must have at least one (1) monthly contribution within the last six (6) months prior to the date of application.
- Income Requirement: For employed members, there must be a "Net Take Home Pay" sufficient to cover the loan amortization, in compliance with the General Appropriations Act (GAA) or company policy.
- Loan Status: If the member has an existing Pag-IBIG Housing Loan or MPL/Calamity Loan, the account must not be in default.
II. Loanable Amount and Interest Rates
The amount one can borrow is not fixed but is relative to the member's Total Accumulated Value (TAV), which includes the member's contributions, employer counterparts, and earned dividends.
| Component | Specification |
|---|---|
| Loan Ceiling | Up to 80% of the member's TAV. |
| Interest Rate | 10.5% per annum for the duration of the loan. |
| Loan Term | Payable over twenty-four (24) or thirty-six (36) months, at the member's option. |
III. Documentary Requirements
For a walk-in application, the following documents must be prepared in original and photocopy:
- Multi-Purpose Loan Application Form (MPLAF): Must be duly accomplished. For employed members, the "Employer's Confirmation" section must be signed by the authorized representative.
- Proof of Income:
- Employed: Latest payslips (at least one month).
- Self-Employed: Photocopy of Business Permit, DTI/SEC Registration, and Audited Financial Statements.
- Valid Identification: Two (2) valid government-issued IDs (e.g., UMID, Passport, Driver’s License, PRC ID).
- Cash Card: A photocopy of a Pag-IBIG Loyalty Card Plus or a LandBank/DBP Cash Card for the disbursement of proceeds.
IV. Walk-in Application Procedures
While online filing via Virtual Pag-IBIG is encouraged, walk-in applications remain a standard procedure at any Pag-IBIG branch or Member Services Office (MSO).
1. Verification and Queuing
Upon arrival at the branch, the member must present their IDs to the information desk to verify their membership status and TAV. A queuing number for "Short-Term Loans" will be issued.
2. Submission and Evaluation
The member submits the completed MPLAF and supporting documents to the loan processor. The processor validates the signatures, calculates the eligible loan amount, and checks for any outstanding delinquencies in other Pag-IBIG loan programs.
3. Acknowledgment Receipt
Once the application is accepted, the member is provided with a Member's Copy or an acknowledgment receipt. This contains the tracking number used to follow up on the status of the loan.
4. Processing Period and Disbursement
The standard processing time typically ranges from three (3) to seven (7) working days. Once approved, the loan proceeds are credited directly to the member's Pag-IBIG Loyalty Card Plus or nominated Cash Card. Notification is usually sent via SMS.
V. Repayment Mechanisms
The legal obligation to repay the loan is governed by the following methods:
- Salary Deduction: For employed members, the employer is legally mandated to deduct the monthly amortization from the employee's salary and remit it to the Fund.
- Voluntary Payment: Self-employed or Voluntary members may pay via Bayad Centers, GCash, Maya, or directly at Pag-IBIG branches.
Legal Note: Under the terms and conditions of the loan, a penalty of 1/2 of 1% of the unpaid amount shall be charged for every month of delay in payment.
VI. Loan Renewal
A member may apply for a new Multi-Purpose Loan only after paying at least six (6) monthly amortizations of the current loan. The outstanding balance of the previous loan will be deducted from the proceeds of the new loan.