AMENDED RULES AND REGULATIONS IMPLEMENTING REPUBLIC ACT NO. 8501

Pursuant to the authority granted to the Board of Trustees of the
Home Development Mutual Fund under Section 13 of Presidential Decree No.
1752, as amended, Rule III of the Rules and Regulations Implementing
Republic Act No. 8501 is hereby amended in response to numerous requests
of member-borrowers who, for various valid reasons, failed to file
their application for condonation of penalties under Section 2 of R.A.
8501 before the expiration of the deadline.

SECTION 1.        Rule III of the Rules and Regulations implementing Republic Act No 8501 is hereby amended to read as follows:

“RULE III
CONDONATION OF PENALTIES UNDER SECTION 2 OF REPUBLIC ACT 8501

Section 1.    Who may apply under this Rule. Any
housing loan borrower or in the event of his death, his heirs, or
successors-in-interest, who has unpaid penalties on his housing loan
with the Fund as of the effectivity of R.A. 8501 and has not yet availed
of any previous condonation program from any government institution or
agency involved in the National Shelter Program, may apply for the
condonation of penalties under this Rule. A housing loan borrower or in
the event of his death, his heirs, or successors-in-interest, who failed
or refused to pay his monthly amortizations due to structurally
defective or substandard housing units and/or subdivisions lacking in
basic amenities such as water, light, drainage, good roads and others
and as required by law, may likewise apply for condonation of penalties
under this Rule.

Section 2.    Condonation of Penalties after Full
Payment/approval of application. All unpaid penalties of said housing
loan shall be condoned after full payment by the housing loan borrower
of all due and demandable arrearages composed of the principal and
interest or upon approval of the borrower’s application for a restructuring of his loan.

Section 3.    Restructuring and term of the Loan.
The unpaid due and demandable arrearages after partial payment shall be
restructured within the remaining period of the loan or over ten (10)
years, whichever is higher, provided that the borrower is at most age 65
at the time of loan maturity and to be paid together with the scheduled
amortization for the undue balance of the original loan in accordance
with the terms and conditions of the respective promissory notes.

Section 4.    Application of Pag-IBIG Savings or Member’s Total Accumulated Value (TAV)

To reduce the amount of loan to be restructured, a delinquent Pag-IBIG housing loan borrower may opt for the following:

1.      Apply at most forty percent (40%) of the
member’s TAV of his savings to his outstanding loan balance if he has an
outstanding Pag-IBIG multi-purpose loan (MPL), and has not previously
offset his TAV against his MPL.

2.      Apply the member’s TAV of his savings to his
outstanding loan balance if he has no outstanding MPL. The member shall
however , be qualified to avail himself of a multi-purpose loan only
after two (2) years.

Section 5.    Interest Rate. The interest rate on the restructured loan shall be the rate on the original loan.

Section 6.    Effect of Default. In the event of default, the total outstanding housing loan shall immediately become due and demandable. Restructured
accounts under the program that incur arrearages equivalent to six (6)
monthly amortizations shall be foreclosed/cancelled automatically.

Section 7.    Borrowers in the government service, who
avail of loan restructuring, shall be required to remit their monthly
payments for the restructured loans through the salary deduction scheme.
Borrowers from the private sector shall likewise be required to remit
their monthly payments for the restructured loans through salary
deduction, if possible. Otherwise they shall be required to issue post
dated checks on annual basis. Accommodation checks will be accepted.
Retiree from either public or private sector who avail of loan
restructuring shall also be required to issue postdated checks on an
annual basis. Accommodation checks will also be accepted.

Section 8.    Availment procedure.

A.      Delinquent Pag-IBIG housing loan borrowers who
opt to avail of the condonation and loan restructuring shall submit the
duly accomplished. Application Form together with an updated Statement
of Account to any Pag-IBIG NCR Branch/Regional Office.

B.      The borrower may opt to apply his Pag-IBIG
savings or TAV to his outstanding loan balance to reduce the amount of
loan to be restructured.

C.      The loan arrearages to be restructured shall be
considered as an additional loan and shall be covered by an amendment
to the LMA and a new PN. The borrower’s ledgers for the original and the
restructured loan shall be maintained independently.

The amendment to the LMA shall be signed by the
borrower and annotated on the TCT at the expense of the borrower. In
case of tacked loans, the co-borrowers shall likewise be required to
sign the amendment to the LMA and the new PN.

D.      Applicants for loan restructuring shall pay the following fees:

1.    Processing Fee of P200.00;

2.    First year’s premium for mortgage redemption and fire insurance;

3.    Registration, annotation and notarization expenses.

Section 9.    Period within which to Avail under this Rule.
A housing loan borrower or in the event of his death, his heirs, or
successors-in-interest may only avail of his right to apply for the
condonation of penalties under this Rule up to March 31, 2001.”

SECTION 2.       All other provisions of the Rules and
Regulations Implementing Republic Act No. 8501 not inconsistent with
these amendments shall continue to be in full force and effect.

SECTION 3.        These amendments shall take effect fifteen days after its publication in a newspaper of general circulation.

27 Oct. 2000

(SGD.) ATTY. WILFREDO E. NUESA
Corporate Secretary