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What is Pag-IBIG Fund?

The Pagtutulungan sa Kinabukasan: Ikaw, Bangko, Industriya, at Gobyerno Fund, often known as the PAG-IBIG Fund or the Home Development Mutual Fund (HDMF), is a fund created to develop a national savings program and an affordable housing financing system for Filipinos. The Pag-IBIG Housing Loan, which offers its members easily accessible and affordable house finance, is the best-known product for Pag-IBIG.

Presidential Decree No. 1530, which first established Pag-IBIG in 1978, was passed primarily to address shelter problems. The Pag-IBIG has been subject to changes in administration and revisions to the many rules and regulations governing its operations due to several adjustments made to its enabling statute. In essence, the HDMF serves as the government’s reaction to the abovementioned problems by offering housing and finance options that would enable regular Filipinos to afford their dream homes.

All working Filipinos, including those with lesser incomes, may be eligible for house loans at the lowest interest rates on the market through the well-known Pag-IBIG fund. The Pag-IBIG fund’s loans also come with extended payback durations of up to 30 years. The Affordable Home Loan for Minimum-Wage and Low-Income Earners, separate from the “Pag-IBIG Housing Loan,” is another housing loan program offered by the Pag-IBIG fund for people with lower incomes.

Mins to Read: 15 minutes

Age: 18-54 years old

In addition to alternatives for house finance, the Pag-IBIG fund offers additional benefits as a national savings program. Here is a list to learn more about the Pag-IBIG Fund:

What Does Pag-BIG Fund Do?

The three primary roles of the Pag-IBIG are loans, insurance, and savings. The Pag-IBIG works with these to assist you in financing your home needs and other short and long-term financial requirements.

Savings

Utilizing its mutual fund, notably in savings and investments, is a vital component of the Pag-provident IBIG’s savings function. Its members’ legally required contributions, and occasionally their employers’ as well, are collected and managed through this function, along with dividend revenues. The programs under this function differ in several significant ways.

For instance, the program under this function is the required PAG-IBIG Savings Program, which offers a slightly lower monthly payment but at a consistent yield. Contrastingly, the Higher Investment Return through Modified Pag-IBIG 2 Savings Program is an optional program for members that offers a somewhat expensive monthly contribution in exchange for a much higher yield than the Pag-IBIG Savings Program’s mandated rate of return.

Insurance

The Pag-IBIG also offers its members several non-life insurance programs, enabling them to protect their properties against any threats that could damage their homes. Subject to certain restrictions, the Mortgage Redemption Insurance program under this function offers amortization support of up to PHP 500,000 or a 20% refund if a member cannot make the remaining amortization payments due to death or permanent incapacity.

On the other hand, the Fire and Allied Perils Insurance Program protects the PAG-IBIG Loan-affected properties from risks like fire, earthquake, flooding, and other natural disasters and catastrophes.

Loans

Additionally, the Pag-IBIG offers its members a range of lending options tailored to their individual or general need. The conditions members must satisfy to qualify for these loans differ, as do the advantages each type may offer qualified members.

The Pag-IBIG offers a variety of loans, including

1. Housing Loans

The Pag-IBIG Housing Loans, especially the Regular Housing Loans (RHL) and the Affordable Housing Program (AHP), often allow eligible members to borrow money for uses that would necessitate land acquisition or residential construction or unit. These may also be used by members who intend to start home building, make improvements or renovations to their current residence, or refinance an existing mortgage. Members who use the AHP may borrow up to Php 750,000 depending on several variables, including the member’s gross monthly income. In contrast, members who use the RHL may borrow up to Php 6 million contingent upon meeting specific requirements.

2. Multi-Purpose Loans

In addition to its direct Housing Loan assistance, the Pag-IBIG Fund also provides a Multi-Purpose Loan (MPL) to meet the short-term financial needs of its members. MPL can be used for a variety of things, including paying for things like medical costs, minor home improvements, small business capital, tuition, and other educational-related expenses, furniture, appliances, and electronics purchases, vacation and travel, special events, and car repairs.

A member’s total Pag-IBIG Regular Savings, which includes their monthly payments, employer contributions, and any accrued profits, can be borrowed up to 80% by eligible members. In other words, a member’s ability to borrow more money depends on how much they have saved.

3. Calamity Loans

Finally, Calamity Loans are programs that enable participants to obtain loans when they are in need due to calamities and other events that may or may not have been anticipated. Within 90 days of the proclamation of a state of crisis, resentful members may obtain loans totaling up to 80% of their cumulative worth. It is crucial to highlight that affected members may still apply for these loans even if they currently have multi-purpose loans or disaster loans outstanding, subject to certain limitations on the number of calamity loans used.

Membership Registration

Who can apply for Pag-IBIG Membership?

Mandatory Membership

For each type of member, the Pag-IBIG fund membership requirements are outlined in Republic Act 9679. These requirements, however, can be said to be strictly applied to mandatory members given that their inclusion in the list required by law automatically qualifies and includes them within the Pag-coverage, IBIG’s attaching to them the necessary monthly contributions as well as any benefits they may be eligible to receive as members. In this regard, the law lists people who are to be considered mandatory Pag-IBIG members, including

Employees who should get SSS benefits include, but are not limited to:
Private employees that are under 60;
Household helpers making at least Php 1,000 each month;
Filipino seamen, upon signing an employment contract with the manning agency and the foreign ship owner as employers;
Self-employed people under 60 with a monthly income of at least Php 1,000; and
Expatriates are required to join the SSS and are under 60 years old.
The judicial and constitutional commissions must be composed of GSIS employees (COMELEC, COA, CSC).
AFP, BFP, BJMP, and PNP uniformed personnel.
Filipinos work for foreign-based companies, whether stationed in the Philippines or elsewhere.

Voluntary Membership

On the other hand, those not included in the above list of mandatory members are not necessarily included in the group of voluntary members. To sign up, voluntary members must be 18 and under 65 years old. Naturally, their registration requires adherence to the same policies and guidelines that apply to all Pag-IBIG members, as well as the prerequisites for being eligible to receive the loans and advantages that the Pag-IBIG offers. In light of this, the following individuals may be qualified to join voluntarily:

Spouses who are not employed but whose spouses who are employed have joined and given their permission.
Filipino workers for international organizations or foreign governments.
Employees of organizations who receive privileges or waivers ostensibly suspend the fund’s coverage.
Members and leaders of religious organizations.
A member who recently lost their job wants to keep making personal contributions.
Public authorities, such as barangay officials, are not covered by the GSIS.
Other financially successful people and organizations, as the Board may decide.

What are the Requirements for Pag-IBIG Membership?

Depending on the type of member and job situation, different documents are required for Pag-IBIG Fund registration. Depending on the nature of your current employment, you will need:

1. Employed Individuals

A Pag-IBIG membership is automatically applied for by those who hold a formal job by their employer. Their employer will essentially handle the paperwork and only request the most basic forms of identification. Since a Pag-IBIG contribution from the employer and its employees is required by law, the formally employed person won’t need to complete much paperwork.

2. Voluntary Members

There are several different categories of volunteer members. Each has its own set of prerequisites, which are as follows:

Self-paying employees

Individuals who are formally employed and simply desire to make their Pag-IBIG donations.

Company ID
Certificate of Employment and Compensation
Latest Pay Slip

Self-employed

This group includes professionals, freelancers, small business owners, and consultants.

Latest Income Tax Return with a CPA-certified Financial Statement from the previous year
Two (2) 1×1 ID photos
Certificate of Remittance or ESAV (this for old members)
Mayor’s Permit or Business Permit
DTI or SEC Registration (under the person’s name)

Self-employed professionals

Private experts, such as attorneys, doctors, and dentists, hold government licenses.

PRC or BAR License
Latest ITR from the previous year
Certificate of Remittance or ESAV (this is for old members)
Two (2) 1×1 ID photos

Overseas Filipino Workers (OFWs) – for reactivating members only.

Latest Contract of Employment
Passport or any valid ID
Latest and valid Contract of Employment (with POEA original stamp)
Certificate of Remittance or ESAV
Passport or any Valid ID/POEA license
Two 1×1 ID pictures
Special Power of Attorney (SPA), in case a representative shall submit the documents and pay the member’s contributions

Unemployed Spouse

An unemployed person who is a Pag-IBIG member’s spouse.

Affidavit of Unemployment
Certificate of Employment and Compensation of the member-spouse
Written consent from the member-spouse

Franchise Holders

Franchise owners who are entrepreneurs.

Latest ITR from the previous year
Franchise Permit (under the person’s name)
Car Registration or Official Receipt (under the person’s name)
Certificate of Remittance or ESAV
Two (2) 1×1 ID photos

Member-Spouse with Business

DTI or SEC Registration
Mayor’s Permit or Business Permit
Affidavit of Unemployment
Latest ITR (from the previous year)
Certificate of Employment and Compensation of the member-spouse (must be notarized)
Written consent from the member-spouse
Two (2) 1×1 ID photos

Unemployed (reactivating members)

Unemployed individuals

Affidavit of Unemployment

How to apply for Membership

Members have the choice of registering online or in person. Those who wish to register in person should consider several factors that will make the process easier.

First, candidates must be aware of the usual business hours of Members Service Offices or Branches. These offices are anticipated to be open for business from 8 to 5 in the afternoon without a break for lunch. It’s also vital to remember that there is no registration charge for becoming a member. The general registration procedure is described below:

Before applying, candidates must complete a Pag IBIG Member’s Data Form.
The next step was to go to the Members Services Office or Branch closest to them and turn in two copies of their properly completed Member’s Data Form along with the other supporting paperwork needed for each voluntary member to the branch’s Marketing and Enforcement Division.
After that, candidates need to get a Payment Order Form and go to the Cash Division to pay for their contributions.
After the payment, they must produce their verified supporting documents to the Marketing and Enforcement Division.

Online Application

On the other hand, candidates who submit their applications must complete the online registration form and set up an account in the PAG-IBIG system. The system would issue the applicant a Registration Tracking Number upon submitting the form. It is significant to remember that this tracking number will be necessary for the remaining registration processes. Applicants may also complete the online registration steps by going to the Members Service Office or Branch.

Log in to www.pagibigfund.gov.ph.
Enter the Virtual Pag-IBIG. Click “Be a Member” and click “Register.”
Fill in all the required data.
Receive an SMS indicating your Registration Tracking Number (RTN) after registration.
Know your permanent Membership ID (MID) number via the Virtual Pag-IBIG after two (2) Working Days.

Membership Contribution

You can apply for housing loans and help through Pag-IBIG membership, turning your dream of owning a home into a reality. But you must make at least 24 monthly saves or contributions to be eligible for Pag-IBIG benefits.

By law, employers must pay the Pag-IBIG payments made by their staff; often, this happens automatically during payroll. By looking at the Pag-IBIG contribution chart below, you can determine whether your employer is accurately deducting your monthly contributions.

Employed Members and Employers

Monthly Salary	Employee’s Contribution Rate	Employer’s Contribution Rate	Total
At least Php 1,000 to Php 1,500	1%	2%	3%
Over Php 1,500	2%	2%	4%

Employers and employees both contribute to Pag-IBIG for members who are employed.

Employers and employees should utilize the Pag-IBIG contribution table above and the following calculation to determine their respective financial obligations:

Pag-IBIG contribution = Monthly Basic Salary x Employee’s or Employer’s Contribution Rate

Example calculations for a worker earning a base pay of Php 1,000 per month:

Employee’s share: Php 1,000 x 0.01 = Php 10

Employer’s share: Php 1,000 x 0.02 = Php 20

The employee pays a monthly salary deduction of Php 10 to Pag-IBIG. The employer adds another Php 20, bringing the monthly savings to Php 30.

Example calculations for a worker earning a base pay of Php 5,000 per month:

The maximum monthly wage that can be used to calculate Pag-IBIG contributions is PHP 5,000. This means that if your monthly wage is Php 5,000 or more, the following formula is used to calculate your contribution:

Employee’s share: Php 5,000 x 0.02 = Php 100

Employer’s share: Php 5,000 x 0.02 = Php 100

Your salary deduction for your monthly Pag-IBIG payment will always be Php 100, regardless of how big your monthly salary now is and how much it will climb in the future, so long as it’s Php 5,000 or more. That sum plus the employer counterpart contribution of Php 100 must be sent by your employer. Being a member of Pag-IBIG entitles you to monthly savings of Php 200.

Self-employed Members

Monthly Income	Contribution Rate
At least Php 1,000 to Php 1,500	1%
Over Php 1,500	2%

Members who are self-employed (such as business owners, independent contractors, TNVS/PUV drivers, market vendors, etc.) pay the entire monthly Pag-IBIG contribution.

To determine how much you’ll pay in monthly savings to Pag-IBIG, use the formula below and the contribution table for Pag-IBIG:

Pag-IBIG contribution = Monthly Income x Contribution Rate

Example calculations for self-employed members earning at least Php 1,500 per month:

Php 1,500 x 0.01 = Php 15

Example calculations for self-employed members earning at least Php 5,000 per month:

Php 5,000 x 0.02 = Php 100

The maximum income used by the Pag-IBIG Fund to determine a self-employed member’s contribution is PHP 5,000. This indicates that you need only pay a minimum of Php 100 every month, regardless of your income, as long as it is at least Php 5,000.

OFW Members

1. For OFWs whose employers are subject to mandatory Pag-IBIG coverage

Monthly Salary	OFW’s Contribution Rate	Foreign Employer’s Contribution Rate	Total
Php 1,500 and below	1%	2%	3%
Over Php 1,500	2%	2%	4%

To determine how much you’ll pay in monthly savings to Pag-IBIG, use the formula below and the contribution table for Pag-IBIG:

Pag-IBIG contribution = Monthly Basic Salary x OFW’s or Foreign Employer’s Contribution Rate

Example calculations for OFWs earning a base pay of Php 1,500 per month:

OFW’s share: Php 1,500 x 0.01 = Php 15

Foreign employer’s share: Php 1,500 x 0.02 = Php 30

This indicates that you should contribute Php 15. In contrast, your employer is responsible for Php 30. Your monthly savings come to Php 45.

Example calculations for OFWs earning a base pay of Php 5,000 per month:

Because the maximum monthly income that Pag-IBIG uses for computation is Php 5,000, your contribution is calculated this way:

OFW’s share: Php 5,000 x 0.02 = Php 100

Foreign employer’s share: Php 5,000 x 0.02 = Php 100

This means that both you and your employer must give at least P100 apiece. You will save a total of 200 pesos each month.

2. For OFWs whose employers are exempted from Pag-IBIG coverage

Monthly Salary	Contribution Rate
Over Php 1,500	2%

To determine how much you’ll pay in monthly savings to Pag-IBIG, use the formula below and the contribution table for Pag-IBIG:

Pag-IBIG contribution = Monthly Basic Salary x OFW’s Contribution Rate

Example calculations for OFWs earning a base pay of Php 5,000 per month:

OFW’s share: Php 5,000 x 0.02 = Php 100

This indicates that you should give at least Php 100 per month.

Unemployed Spouse

50% of Working Spouse’s Monthly Salary	Pag-IBIG Contribution Rate
Php 1,500 and below	1%
Over Php 1,500	2%

Half of the working spouse’s monthly wage is used to calculate the non-working spouse’s Pag-IBIG contribution.

To determine how much you’ll pay in monthly savings to Pag-IBIG, use the formula below and the contribution table for Pag-IBIG:

Pag-IBIG contribution = 50% of Working Spouse’s Monthly Salary x Working Spouse’s Contribution Rate

For instance, a full-time housewife whose husband makes Php 4,000 per month contributes Php 40 per month. This is how you calculate it:

Unemployed Spouse’s share: (Php 4,000 / 2) x 0.02 = Php 40

Because 50% of her working spouse’s pay, which is Php 2,000, is in the range of salaries above Php 1,500, the non-working spouse’s contribution rate is 2%.

Household Helpers & Household Employers

Monthly Salary	Employer’s Contribution Rate	Household Helper’s Contribution Rate	Total
Less than Php 1,500	3%	0%	3%
Php 1,500 to Php 4,999	4%	0%	4%
Php 5,000 and above	2%	2%	4%

To determine how much you’ll pay in monthly savings to Pag-IBIG, use the formula below and the contribution table for Pag-IBIG:

Pag-IBIG contribution = Monthly Basic Salary x Household Helper’s or Employer’s Contribution Rate

Household employers who pay their household helpers less than Php 5,000 per month must pay the total amount.

Example calculations for household helpers earning a base pay of Php 1,000 per month:

Employer’s share: Php 1,000 x 0.03 = Php 30

Household Helper’s share: None

If a worker’s salary is less than Php 1,500, the employer is required to donate 3% of that wage.

The entire Pag-IBIG savings for household helpers making less than Php 1,500 per month is thus Php 30.

Example calculations for household helpers earning a base pay of Php 3,000 per month:

Employer’s share: Php 3,000 x 0.04 = Php 120

Household Helper’s share: None

If the wage is between PHP 1,500 and PHP 4,999, the employer should contribute 4%.

Thus, household helpers who make between Php 1,500 and Php 4,999 per month have a total Pag-IBIG savings of Php 120.

Example calculations for household helpers earning a base pay of Php 5,000 per month:

Employer’s share: Php 5,000 x 0.02 = Php 100

Household Helper’s share: Php 5,000 x 0.02 = Php 100

Household Helpers must subtract the 2% from their salaries if they make Php 5,000 or more per month. Additionally, 2% of their monthly wage should be contributed by their employer to their overall monthly payment.

Therefore, household helpers who make Php 5,000 or more per month have a total Pag-IBIG savings of Php 200.

Benefits of Pag-IBIG Fund

A Pag-IBIG Fund membership has many benefits beyond being necessary for a new job. Members’ access to Pag-IBIG rewards can assist them in addressing both their immediate and long-term financial requirements.

Government-backed savings and yearly dividends are tax-free.
Regularly set aside funds through the Pag-IBIG Regular Savings Program and MP2 Program for retirement and other financial goals.
Borrow money through Pag-IBIG loans (housing, wage, and catastrophe loans) with low-interest rates and extended repayment terms to support various needs.
The Pag-IBIG Loyalty Card Plus offers discounts, rewards, and other benefits.

When to Claim Your Pag IBIG Contributions?

1. Membership Maturity

The membership maturity is calculated based on 20 years of membership from the first contribution date.

At the time of membership maturity, you must have sent at least 240 monthly membership contributions.

Twenty years is a very long time, and there may be times when you cannot make our Pag IBIG installments. Therefore, if you have contribution gaps, what should you do?

Consider a gap of two years or less. Simply fill in the hole at that point to collect 100% of your funds, including the sum spent to do so.
You must still make up the difference before you may recover your savings if it is longer than two years. The cash you used to close the gap will be deducted from your lump amount at that point. Before claiming the money you paid for the hole, wait until the period equating to that period has passed.

2. Retirement

When they turn 65, Pag IBIG participants must claim their Pag IBIG funds.

However, you may also claim it in the event of early retirement in specific circumstances.

You can claim your Pag IBIG total accumulated savings if you are at least 60 years old, but you must present a verified copy of your birth certificate.

You can also receive your Pag IBIG funds if you took early retirement at 45 but were under 60, provided that you have:

a Notarized SSS Early Retirement Certificate (for private employees),
a GSIS retirement Voucher (for those working for the government), or
an Order of Retirement (For AFP).

3. Permanent and Total Disability or Insanity

The following conditions are regarded as total and permanent impairments. Therefore, the member will have enough justification to claim Fund benefits if they meet these requirements.

S continuous total disability that lasts more than 120 days;
Total blindness in both eyes;
Loss of two limbs;
Lifetime complete paralysis of two limbs;
Brain damage that causes insanity or incapacity; and
The Board of Trustees and a fully licensed physician decide on these additional circumstances.

4. Separation From The Service Due to Health Reasons

Occasionally, members’ serious medical issues prevent them from doing their duties. These conditions include diseases, injuries, or physical and mental limitations that require ongoing medical attention.

You must provide a physician’s certificate and a medical abstract to claim your Pag IBIG savings.

5. Permanent Departure From The Country

You may be able to claim your funds if you choose to relocate permanently abroad. You will need to provide:

A clear copy of your passport;
An immigrant visa, or its equivalent; and
A notarized sworn declaration of your intention to leave the Philippines permanently.

6. Death

According to the New Family Code, the Fund savings will be distributed to the named heirs if a member passes away. The claimant must provide the following:

Certificate of Member’s Death, Certified True Copy
Proof of surviving heirs (must be notarized)
Certified True Copies of the Children’s Birth Certificates
A certified true copy of the member’s marriage contract or birth certificate can be used as evidence of the relationship with the deceased.