Is pag ibig loan Legit or not? pag ibig loan Reviews 2023


What is Pag-IBIG?

The Home Development Mutual Fund or Pag-IBIG fund was established in 1978 by the Philippine government as a way to provide Filipinos with affordable housing loans and a national savings program. Pag-IBIG stands for Pagtulong sa Kinabukasan: Ikaw, Bangko, Industriya at Gobyerno or “Help for the Future: You, Bank, Industry and Government”.

Membership in Pag-IBIG is required for many employees and workers in the Philippines. This includes those under the Social Security System (SSS) and Government Service Insurance System (GSIS), as well as certain groups like overseas Filipino workers (OFWs), members of the judiciary, and locally employed Filipinos.

As a Pag-IBIG member, you are expected to contribute a minimum of P100 per month to your savings account. For locally employed members, this amount is automatically deducted from their salary by their employer. Self-employed individuals and OFWs need to enroll and pay contributions directly to Pag-IBIG through their website or branches.

The more you contribute to your Pag-IBIG savings, the higher your dividends will be each year. Pag-IBIG distributes 70% of its annual earnings to members based on their savings balances. Maintaining an active Pag-IBIG account for at least 24 months makes you eligible to apply for their affordable housing loans.

What is the Pag-IBIG Housing Loan?

The Pag-IBIG housing loan program provides members with financing to purchase residential properties such as a house and lot, condominium unit, or townhouse. Loans can also be used for home construction or renovation projects.

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To qualify for a Pag-IBIG home loan, applicants must be active members of the fund for at least 24 months with all savings contributions up to date. They must also be under 65 years old and have the legal capacity to acquire property. Existing loans must be in good standing.

The maximum loan amount a member can borrow is based on their repayment capacity and the appraised value of the property being purchased. As of 2022, the ceiling for Pag-IBIG housing loans is P6,000,000. Applicants have up to 30 years to pay off the loan. Repayment options include auto-debit from a bank account or post-dated checks remitted monthly.

Terms and Rates of the Pag-IBIG Housing Loan

Pag-IBIG offers housing loans with fixed interest rates that can be locked in for periods of 1, 3, 5, 10, 15, 20, 25 and 30 years. The longer the fixing term, the higher the interest rate will be.

As of January 2023, the published interest rates for newly approved Pag-IBIG home loans are:

  • 1-year fixing: 5.75%
  • 3-year fixing: 6.375%
  • 5-year fixing: 6.625%
  • 10-year fixing: 7.375%
  • 15-year fixing: 8.000%
  • 20-year fixing: 8.625%
  • 25-year fixing: 9.375%
  • 30-year fixing: 10.000%

Borrowers have flexibility to choose the fixing term that best fits their monthly budget based on how long they need to pay off the loan. Penalties apply for loan pretermination or equity buyback within the chosen fixing period.

Comparing Pag-IBIG Loans to Bank Loans

While Pag-IBIG housing loans aim to provide affordable financing through government support, they also have certain limitations compared to loans offered directly by banks:

  • Membership required for Pag-IBIG – You don’t need to be a Pag-IBIG member to apply for a bank loan.

  • Lower loan ceilings – Pag-IBIG loans are capped at P6 million, but bank loans may finance up to 80% of a property’s appraised value.

  • Longer processing – Pag-IBIG underwriting takes 4-6 weeks on average versus under 2 weeks for many bank loans.

  • Fixed for life – Pag-IBIG loans can’t be refinanced if rates drop, but bank loans are refinanceable.

  • Higher long term rates – To make repayments over 30 years, the 10% Pag-IBIG rate is higher than typical 20-year bank rates.

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Overall, bank loans offer more flexible financing options compared to the limitations of Pag-IBIG’s statutory housing program. However, Pag-IBIG remains an affordable alternative for those who qualify based on income and property value.

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Factors to Consider When Choosing

With both Pag-IBIG housing loans and bank loans available in the Philippines, it’s important to evaluate your unique situation when deciding which option may be best for you:

  • Income and affordability – Can you comfortably afford higher monthly payments on a 20-year bank loan versus 30 years with Pag-IBIG?

  • Property value – If buying an expensive home, you may need a higher bank loan ceiling versus Pag-IBIG’s P6M cap.

  • Timeframe – Can you wait 4-6 weeks for Pag-IBIG approval or do you need a loan faster from a bank?

  • Future plans – Will you resell or refinance, benefiting from a bank’s flexibility over Pag-IBIG’s fixed terms?

  • Current savings – Do you have enough Pag-IBIG contributions for the full 24 months of membership eligibility?

Consulting a mortgage broker can help analyze these factors to identify which loan program optimizes costs and fits your long-term homeownership goals. With their expertise, brokers simplify the process of choosing between competitive Pag-IBIG and bank loan options.

Using a Mortgage Broker

Dealing directly with numerous banks and Pag-IBIG branches can make navigating the home loan process challenging. This is where using a mortgage broker like Nook comes in handy.

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As the Philippines’ first digital mortgage broker, Nook simplifies finding the right home loan for your needs. They represent both Pag-IBIG housing loans as well as major bank products all in one portal.

Nook’s licensed loan officers shop for the most competitive rates and instantly pre-qualify applicants online. They submit complete applications, track statuses, and keep borrowers updated throughout underwriting.

This reduces time and effort spent going between lenders. Nook also verifies property details, prepares required documentation, and schedules loan closings – taking the legwork out of the process.

Their services are free for borrowers since lenders pay brokerage commissions. Nook ensures clients get the lowest costs through negotiations using their prestigious industry partnerships.


For many Filipinos, Pag-IBIG housing loans have been the path to homeownership thanks to their accessibility and affordability. However, budgeting long term costs and flexibility of options are important factors to weigh.

Consulting mortgage experts allows comparing features between Pag-IBIG and bank loans to find the best fit. Digital brokers now make this evaluation simpler by bringing multiple lending opportunities together in one platform.

In the end, choosing the loan program optimized for your unique financial situation and long term goals can help realize the dream of owning a home. Taking the time to shop rates and terms upfront pays off in lower housing costs over the life of the mortgage.


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