Old is the notion that our fellow overseas countrymen are the ample milking cow of any Filipino household. While it is true that those who risked working from abroad may be having the privilege of earning more from than their local counterparts, being an OFW does not necessarily mean one who does not run out of money.
Like any thing that is finite in source, money, too, is a limited resource that drains as easily as it fills. Hence, there is the need for our kababayans to push themselves into working from another land despite the difficulty.
It is for the understanding of this plight that an established government institution as PAG-IBIG is there to assist the needy but has the right qualification to pay back what is to be owed via a short-term loan known as PAG-IBIG Multi-Purpose Loan.
What is a PAG-IBIG Multi-Purpose Loan?
The Multi-Purpose Loan, or MPL for short, is a kind of money loan categorized as PAG-IBIG’s as one of the government institution’s short-term loan program which seeks to render financial assistance to qualified individuals.
While not limited to, a PAG-IBIG Loan is meant for qualified members in need of emergency cash due to:
- Emergency/non-emergency house repair
- Home improvement (minor)
- Home enhancement
- For tuition or educational expenses
- Improvement of health or wellness
Who are qualified to avail of the short-term loan?
Being an Overseas Filipino Worker alone does not guarantee anyone to qualify for MPL. There is a set of requirements for each individual to meet in order to fully qualify for the aforementioned loan.
OFW PAG IBIG Cash Loan Requirements
Specifically, a will-be recipient of the loan must be:
- A PAG-IBIG member
- Has at least complied with his mandatory monthly savings (MS) for at least 24 months
- Prior to date of application for the loan, must have at least conducted 5 monthly savings in the last 6 months
- No existing loans (housing, calamity, or MPL) in default prior to another MPL application
How much a loan can a qualified applicant borrow?
Not all lenders can get the same amount with their loans. Primarily, this is differentiated by each member’s so-called Total Accumulated Value.
No. of monthly savings Loan Value
24 ~ 59 months – Up to 60% of Total Accumulated Value (TAV)
60 ~ 119 months – Up to 70% of TAV
At least 120 months – Up to 80% of TAV
How much is the interest rate for the loan?
PAG-IBIG is not a charity business that lends money without expecting something in return. True to its name, a Multi-Purpose Loan is expected to be repaid with the right interest throughout the duration of the loan which is set at 10.75% per year.
How long is the repayment period?
A Multi-Purpose Loan is set to be paid over a duration of 24 months after getting granted the loan with an allowable 2 months’ grace period.
Repayment of the loan should start at the 3rd month based on the date on the DV/Check. Payment is expected to be remitted to PAG-IBIG within 15 days of every month.
Things to Consider Before Making a Loan
Knowing that there is an institution that you can run to for money may be relieving enough especially when money is getting scarce and immediate needs for money may arise.
However, loans are not something any person should not take lightly lest they feel the consequence of its penalties. In fact, lending money—even if not from PAG-IBIG—should only be a last resort than a primary option when it comes to needed cash.
Why? Simply because loans are an amount of money that is only handed over to you with the expectation of bringing it back plus interest relevant to the amount you owed. Obviously, a measure such as this is deeply entrenched in the principles of business and not one out of act of charity like what you would expect from your significant others who would only expect you to return the amount you owe, without interest.
But if the need to borrow outweighs everything else and that PAG-IBIG is probably your best option rather than the local loan sharks, at least consider the following factors before confidently file for a loan application:
Do you have the means in the future to pay back the money you are borrowing? Can you pay back the loans on time at least?
When the need for money immediately arose, we sometimes fall for the urgency of acquiring the needed cash without thinking of future repercussions. Unlike with the idea of “just living in the present” and not minding future problems, there is a plight about falling into debt resulting from an untimely or no payment to what is due. Similar to banks, borrowing money from the government can be a sinking experience in the mire if you are not responsible enough with your finances.
Is the loan already worth the rush or is it something that can be put aside for later?
There is a sense of timeliness whether a loan is beneficial to the lender or not, apart from the context of emergency. Sure, the need to make a renovation at house or expand on it is important for a growing family but getting a loan for something capricious may not be as worth it as a lender making a loan arising from the need for medical treatment of himself or another person.
Do not put yourself in a tight situation with minimal benefits just because of being whimsical about it. Measure the pros and cons of every decision to make whenever appropriate, especially if it concerns finances.
Put aside what can be done for later when circumstances are better than push on the moment when pursuing on it does more harm than good. Money matters is not something to be trifled with and is something, that when handled properly, could save you a lot of headaches in the future.