Pag-IBIG FundCorporate Headquarters

Petron Mega Plaza358 Sen. Gil Puyat Avenue

Makati City

Circular No. 441

TO: ALL CONCERNED

SUBJECT: GUIDELINES ON THE REPURCHASE OF Pag-IBIG FUND REALAND OTHER PROPERTIES ACQUIRED

Pursuant to the approval of the Pag-IBIG Fund Board of Trustees in its meeting last10 November 2020, the Guidelines on the Repurchase of Pag-IBIG Fund Real andOther Properties Acquired Program is hereby issued:

I. OBJECTIVES

The Repurchase of Pag-IBIG Fund Real and Other Properties Acquired (ROPA)Program aims to:

1. Hasten disposal of Pag-IBIG Fund acquired assets by offering newly cancelledSales Contract Receivable accounts for sale to eligible originating developers;

2. Ensure the full recovery on non-performing accounts through the sale of Pag-IBIGFund acquired assets based on the book value of the accounts; and

3. Save the expenses that the Fund may incur in the maintenance, marketing andmanagement of the Pag-IBIG Fund ROPA.

II. COVERAGE

This program shall cover the purchase of Pag-IBIG Fund ROPA that are located in thesubdivision or condominium housing projects of eligible originating developers.

III. ELIGIBILITY REQUIREMENTS

To qualify for the Repurchase of Pag-IBIG Fund ROPA, the originating developersmust meet the following eligibility requirements:

1. Must have transacted with Pag-IBIG Fund for at least five (5) years. However,developers who have already transacted with the Fund for at least three (3) yearsmay likewise be qualified under the said program, subject to the approval of theCluster Credit Committee;

2. Must be in good standing, wherein the developer has maintained its accreditationwith Pag-IBIG Fund;

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3. Must meet the following evaluation parameters:

3.1. Quality of Mortgage Documents Ratio of at least 90%;3.2. Quality of Units Ratio of at least 90%;3.3. Conversion Performance of at least 90%;3.4. Performing Accounts Ratio of at least 90%;3.5. No accounts overdue for buyback.

4. Must have paid the Expanded/Creditable Withholding Tax for the coveredaccounts.

IV. MECHANICS OF THE PROGRAM

1. Qualified developers shall enter into a Memorandum of Agreement with the Fundin relation to the repurchase of ROPA accounts.

2. Upon the lapse of the third (3rd) cycle of remediation activities, Pag-IBIG Fund shallinform eligible developers of the Pag-IBIG Fund ROPA located in their housingprojects that are available for repurchase. Said acquired assets shall be sold onan "as is, where is" basis.

3. Developers shall submit an Intent to Purchase to Pag-IBIG Fund, with the list ofacquired assets they intend to repurchase within thirty (30) calendar days from thereceipt of the said notice. Any unsold account shall be endorsed for disposal inaccordance with the prevailing guidelines on the sale of Pag-IBIG Fund ROPA.

4. A Repurchase Agreement shall be executed between the developer and the Fundfor the sale of the acquired assets.

5. The repurchase price of the subject acquired assets shall be based on the bookvalue, which is equivalent to the outstanding principal balance of the accounts plusthree (3) months accrued interests.

5.1. The developer shall pay the repurchase price through cash within ninety (90)calendar days from the execution of the Repurchase Agreement. However,the developer may request to pay the said amount through installment for amaximum period of one (1) year, subject to the approval of the ClusterDisposal Committee.

5.2. Developers shall pay the Repurchase Price through Post Dated Checks,Cash/Manager's Check, or application of takeout proceeds.

6. The developer shall pay a downpayment of at least five percent (5%) of the totalrepurchase price within thirty (30) calendar days from the signing of theRepurchase Agreement.

7. Any remaining retention fee for the covered acquired assets shall be applied asdown payment or part thereof.

8. All taxes and transfer costs related to the purchase of Pag-IBIG Fund acquiredassets shall be on the account of the developer.

V. RELEASE OF TITLE UPON PAYMENT OF THE REPURCHASE PRICE

All titles to properties subject of the Repurchase Agreement shall be released uponfull payment of the repurchase price. Partial release of titles shall be allowed forapproved installment payment plan.

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VI. DEFAULT

1. The developer shall be considered in default due to any of the following grounds:

1.1 Failure to pay the Total Repurchase Price within the prescribed period, or

1.2 Violation of the terms and conditions in the Memorandum of Agreement.

2. In case of default, the remaining repurchase price, including accrued interests,penalties, fees and other charges shall become due and demandable from thedeveloper. Pag-IBIG Fund shall offset the said amount against subsequent takeoutproceeds or from any amount due the developer, if any.

3. The developer's participation in this program shall be suspended until the balanceof the repurchase price has been collected in full. Thereafter, suspension from theprogram may be lifted; provided, the developer meets the criteria provided herein.

VII. MECHANISM ON RESOLUTION OF ISSUES

Any issue in the interpretation and implementation of this Guidelines shall, as muchas possible, be resolved by the concerned officer based on the procedures andbusiness rules for this Guidelines. Matters that are not thereby satisfactorilyresolved shall be escalated to the next higher approving authority.

VIII. AMENDMENTS

Amendments to this Guidelines shall be approved by the Senior ManagementCommittee pursuant to the authority bestowed on it by the Fund's Board of Trusteesto formulate and issue guidelines and procedures in furtherance of the objectivesof this program consistent with the mandate of the Fund under its Charter andexisting laws.

This Guidelines shall modify the order of disposal under Pag-IBIG Fund CircularNo. 428, or the Omnibus Guidelines on the Sale of Pag-IBIG Fund Real and OtherProperties Acquired.

IX. EFFECTIVITY

This Circular takes effect after fifteen (15) calendar days following the completionof its publication in the Official Gazette or in a news per of general circulation .

. MOTI

Makati City,

December 21 ,2020

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