# Pag-IBIG Housing Loan Calculator

Created by Kenneth Alambra
Reviewed by Tibor Pal, PhD candidate and Steven Wooding
Last updated: Nov 21, 2022

This Pag-IBIG housing loan calculator is a supplementary tool you can use in conjunction with the official . This tool also works as a housing loan amortization calculator and a housing loan interest calculator.

In this tool, you will learn about the following:

• What is the Pag-IBIG Fund?
• How to use this Pag-IBIG housing loan calculator.
• How to calculate how much you can loan based on the property value.
• How to calculate how much you can borrow based on your income.
• The other formulas used in this calculator.

Use this housing loan calculator to help you plan ahead for your visit to a Pag-IBIG branch, a property developer, or a real estate agent. Keep on reading to start learning.

💡 For more in-depth calculations on home loans, you can check out our home loan calculator. There, you will learn what debt to income ratio (DTI) is and find charts that can help you assess your housing loan.

## What is Pag-IBIG Fund?

The Pag-IBIG Fund, another name of the Home Development Mutual Fund or HDMF, is a government-owned and controlled corporation that Filipinos can go to to help them manage their savings and find affordable financing options when acquiring housing loans.

Pag-IBIG is an acronym for "Pagtutulungan sa Kinabukasan: Ikaw, Bangko, Industriya at Gobyerno," which directly translates to "Working together in the Future: You, Banks, Industry, and Government." "Pag-ibig" is also a Filipino word for "love". ❤️

🙋 To know how much your monthly contributions to the Pag-IBIG Fund should be, our Income Tax in the Philippines Calculator can help you with that.

## How to use this Pag-IBIG housing loan calculator

This Pag-IBIG housing loan calculator has three different functions.

The first is to determine how much you can borrow based on the value of the property you want to purchase. For that, simply enter the estimated value of the property you're eyeing up. Our tool will instantly display the maximum loanable amount you can borrow from Pag-IBIG.

You can then (for the second function) calculate how much your monthly amortization would be if you want to push through with that amount. Follow these steps for that:

1. Enter the loan amount you wish to borrow. Remember: Your loan amount cannot exceed your calculated loanable amount.

2. Select your repayment period. Your repayment period can be as quick as one year or as long as 30 years.

3. Choose your desired fixed pricing period. The fixed pricing period is a duration wherein we can get a fixed interest rate regardless of the economic status or performance of the market.

Suppose you pick 5 years of a fixed pricing period. Your repayment interest rate will be 6.625% during that 5 years of repayment. In the 6th year and beyond, Pag-IBIG will provide you with a new interest rate that could be higher or lower than 6.625%.

You can choose the 30-year fixed pricing period if you choose a repayment period of 30 years and if you think that somewhere down the road, the interest rate would go up higher than 10%.

After doing these steps, our calculator will display how much your monthly amortization should be during your selected repayment period. That makes this tool a housing loan amortization calculator and a housing loan interest calculator (because you'll also see the calculated loan interest – but only after clicking the Advance mode button below our tool).

Consequently, our housing loan calculator will also show you how much your gross annual and monthly income should be to qualify for this loan amount. What's even more interesting is that you can use our housing loan calculator the other way around as a loanable amount based on your gross income calculator.

For that, make sure the loan amount variable is empty. Then, enter your gross monthly income (or your gross annual income).

If you want to learn how to perform these Pag-IBIG housing loan computations manually, then keep on reading.

🔎 Note that you can only borrow a maximum of ₱6,000,000.00 from Pag-IBIG. Our tool will prompt you if it detects an entered or calculated loanable amount or a loan amount above that limit.

## How to calculate how much you can loan based on the property value

According to Pag-IBIG, you can only borrow up to 95% of the property value that you want to purchase. However, that percentage lowers to 90% if the property is greater than what they call the economic housing limit. We call these percentage values the LTV ratio or the loan-amount-to-appraised-value ratio. Here is a tabulated version of that statement.

Appraised value of the property

LTV ratio

Up to the economic housing limit

95%

Over the economic housing limit and up to ₱6,000,000

90%

This calculator (and the Pag-IBIG Fund Housing Loan Affordability calculator) uses an economic housing limit of ₱1,888,889.00. That means if the property's estimated value is less than or equal to that, we can use an LTV ratio of 95%.

## How to calculate how much you can borrow based on your income

Here is the formula we can use to calculate the amount you can borrow based on your income and chosen monthly interest rate under the fixed pricing period:

$P = 0.35\! \times\! M\! \times\! \frac{(1+i)^n -1}{i \times (1+i)^n},$

where:

• $P$ – Loanable amount;
• $M$ – Gross monthly income;
• $i$ – Monthly interest rate; and
• $n$ – Term duration in months.

This formula is a combination of the rearranged general monthly amortization formula and the gross income requirement provided by the Pag-IBIG. Here is the rearranged general monthly amortization formula we used that you may already be familiar with:

$P = A\times \frac{(1+i)^n -1}{i \times (1+i)^n},$

where:

• $A$ – Monthly amortization according to the general monthly amortization formula, but is equal to the sum of the monthly principal and monthly interest payments to Pag-IBIG.

According to the guidelines of Pag-IBIG, you can only borrow up to a monthly amortization (excluding insurance) of at most 35% of your gross monthly income. In equation form, we express that as:

$A = 0.35 \times M$

By merging these two equations, we develop the formula to find the loanable amount based on your gross monthly income, as shown earlier.

We can also rearrange that formula to derive the equation to find the required gross monthly income you should have to borrow a particular loan amount at a given interest rate. Here is the derived formula for that:

$M = \frac{P}{0.35} \times \frac{i \times (1+i)^n}{(1+i)^n -1}$

## Other formulas used in this housing loan amortization calculator

In our housing loan calculator, we use the term monthly principal and interest for the "monthly amortization" that we denote as $A$ in our formulas. Also, we calculate $A$ using this formula:

$A = P \times \frac{i \times (1+i)^n}{(1+i)^n -1}$

However, that doesn't include the calculated insurance cost that we add to get the total monthly amortization in our tool. For Pag-IBIG housing loan computations, we determine the monthly insurance premium, $Q$, using this equation:

$\small Q = P \times 0.00023$

By clicking on our tool's Advanced mode button, you'll also be able to see an estimated equity variable. We get that value by taking 5% of the estimated value of the property, as shown below:

$\small \text{equity} = 0.05 \times \text{property value}$

Lastly, we find the monthly interest using this equation:

$\small \text{monthly interest} = \frac{P \times i}{12}$

We can subtract the monthly interest from the monthly principal interest to find the monthly principal payment – the only portion of the amount you pay that goes directly to the payment for the house you're purchasing.

Find out how much you can shorten your payment period and end up paying less interest if you pay extra monthly using our mortgage amortization calculator.

🙋 Please note that the information provided in this text is for educational purposes only. The calculated loanable amount and other values may differ from the actual values depending on Pag-IBIG's evaluation of the borrower, and additional fees may apply.

## FAQ

### Can I borrow 500k pesos from Pag-IBIG?

That depends. According to Pag-IBIG, you can only borrow up to an amount with a monthly amortization of at most 35% of your gross monthly income.

If you wish to repay your ₱500,000 loan for a repayment period of 30 years at a 10% interest rate, you should be earning a gross monthly income of at least ₱12,536.74 to qualify. If for 10 years (7.375%), your monthly income should be at least ₱16,864.34.

### How much housing loan can I get on 40,000 pesos monthly salary?

You can borrow up to around ₱1.59 million or ₱1,595,311.48, to be precise. That is if you wish to repay that loan amount for 30 years at a 10% interest rate. If you want to repay your loan for, say, 15 years (at an 8% interest rate), you can only borrow up to ₱1,464,968.29.

### What is the loanable amount for an estimated property value of 3 million pesos?

The loanable amount for an estimated value of the property of ₱3 million is ₱2.7 million. We get that value by multiplying ₱3,000,000 by the loan-amount-to-appraised-value ratio (or LTV ratio) of 90% (or 0.9) to get ₱2,700,000. For properties less than or equal to the economic housing limit of around ₱1,888,889.00, use an LTV of 95%.

### How do I calculate how much of my payment goes to the house I'm buying?

To calculate the principal amount of your housing loan in Pag-IBIG, say a loan amount (P) of ₱2,000,000 for 30 years (or n = 360 months) at a 10% interest rate (or i = 0.10),

1. Determine your monthly amortization (A) without the insurance premium using this equation:

A = [P × i/12 × (1 + i/12)^n]÷[(1 + i/12)^n - 1]

= [₱2,000,000 × 0.10/12 × (1 + 0.10/12)^360]÷[(1 + 0.10/12)^360 - 1]

= ₱17,551.43

2. Then, compute the monthly interest using this formula:

monthly interest = P × i/12
= ₱2,000,000 × 0.10/12
= ₱16,666.67

3. Finally, subtract the monthly interest from A to get your monthly principal amount:

monthly principal amount = A - monthly interest
= ₱17,551.43 - ₱16,666.67
= ₱884.76

Kenneth Alambra
Loanable amount based on property value
Estimated value of property
Loanable amount
Loan and repayment details
Loan amount
Repayment period
30 years
Fixed pricing period
30 years (10.000%)
Monthly principal and interest
Total monthly amortization
Income details
Gross annual income
Gross monthly income
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