Pag-IBIG Penalty Condonation: How to Waive Penalties and Additional Interests

The Pag-IBIG Penalty Condonation Program is a significant initiative designed to provide financial relief to housing loan borrowers. This program understands that various circumstances can lead to delayed payments, resulting in accumulated penalties and additional interest. To alleviate this burden, the program offers an opportunity to waive all these extra charges, providing a fresh start for borrowers.

Also read: Pag-IBIG Housing Loan Revaluation: Learn How to Maximize Your Property Value

Borrowers can take advantage of this program in two ways. Firstly, by fully updating their housing loan account, they can rid themselves of any penalties or additional interests that have accrued due to late payments. Secondly, if borrowers are capable of fully paying off their housing loan, they can do so under this program without having to worry about any accumulated penalties or additional interest. This well-thought-out program aligns with Pag-IBIG Fund’s commitment to aiding its members in managing their finances more effectively and achieving their housing dreams.

Pag-Ibig Fund Cebu

Benefits of Pag-IBIG Penalty Condonation Program

The Pag-IBIG Penalty Condonation Program offers a significant relief to housing loan borrowers who have fallen behind on their payments.

Here are the key benefits of this program:

  1. Waiver of Penalties: One of the primary benefits of this program is that it waives all penalties that borrowers have incurred due to missed payments. This can significantly reduce the financial burden on borrowers and make it easier for them to update or payoff their housing loan account.
  2. Waiver of Additional Interests: In addition to penalties, the program also waives any additional interest that has accrued due to the delay in payments. This further reduces the amount that borrowers need to pay to update or settle their housing loan account.
  3. Financial Relief: By waiving penalties and additional interests, the program provides substantial financial relief to borrowers. This can help borrowers manage their finances better and prevent further financial distress.
  4. Smoother Path to Homeownership: By making it easier for borrowers to update or payoff their housing loan account, the program smoothens the path to homeownership. Borrowers can focus more on fulfilling their dream of owning a home without the stress of penalties and additional interests.
  5. Promoting Financial Responsibility: By offering such a program, Pag-IBIG also promotes financial responsibility among its members. It encourages borrowers to update or payoff their housing loan account by providing a significant incentive – the waiver of penalties and additional interests.

pag-ibig housing

Who is Eligible for the Pag-IBIG Penalty Condonation Program?

The Pag-IBIG Penalty Condonation Program is structured to assist a wide array of housing loan borrowers.

  • The program is accessible to all Housing Loan borrowers who have a minimum of three months’ worth of arrears or unpaid amortizations. This means if you’ve missed out on making at least three monthly payments, you qualify to apply for the Penalty Condonation Program.

However, it’s important to note that if your housing loan account has been cancelled, or foreclosed, or if the property is now under the ownership of Pag-IBIG Fund, you would be ineligible for this program. Therefore, it’s crucial to apply for the program before reaching these stages to avail the benefits of having penalties and additional interests waived.

Application Process for Penalty Condonation Program

Applying for the Pag-IBIG Penalty Condonation Program is a straightforward process.

Here are the steps you need to follow:

Step 1: Submit Application Form and Requirements

The first step is to submit the Penalty Condonation Application Form along with any required documents.

Step 2: Request Statement of Account

Next, request your Statement of Account to obtain the Computation Sheet. This document will provide you with details on how much you owe, including principal, interest, and penalties.

Step 3: Review and Encoding by Lingkod Pag-IBIG Personnel

Once you’ve submitted your application, it will be reviewed and encoded by Lingkod Pag-IBIG personnel. After this step, your application will be endorsed to the Approving Authority for signature.

Step 4: Generation of Payment Order Form

Upon approval, a Payment Order Form will be generated for Full Updating/Full Payment. You will be asked to sign the supporting documents at this stage.

Step 5: Successful Application

Congratulations! You have successfully applied for your Penalty Condonation. Just wait for a call from our Lingkod Pag-IBIG personnel to notify you of the status of your application.

By following these steps, you can avail the benefits of the Penalty Condonation Program and move closer to settling your housing loan account without the burden of penalties and additional interests.

Also read: Pag-IBIG Plan of Payment: How to Clear Your Unpaid Housing Loan in Simple Steps

Requirements Needed for Penalty Condonation Program

To apply for the Pag-IBIG Penalty Condonation Program, you will need to prepare and submit the following documents:

  1. Application for Condonation of Penalties/Additional Interests (HQP-HLF-540): This is the main application form for the program. It needs to be duly accomplished and submitted.
  2. Updated Real Estate Property Tax (REPT) Receipt/Tax Clearance and Tax Declaration (Land and Building): These documents are required if the mode of settlement is through full updating. They serve as proof that you have paid all necessary taxes on your property.
  3. Valid ID with Signature: You will need to provide a valid ID with your signature (back-to-back) and that of your spouse if applicable. Similarly, if there’s a co-borrower and their spouse, their IDs are also required.
  4. Notarized Special Power of Attorney (SPA): If you have an Authorized Representative who will handle the application process on your behalf, a notarized Special Power of Attorney from both the borrower/s and spouse is necessary.

By gathering these requirements in advance, you can ensure a smoother application process for the Penalty Condonation Program. Ensure that all the documents are up-to-date and valid to avoid any potential delays or issues.

Tips for Availing the Pag-IBIG Penalty Condonation Program

Successfully availing the Pag-IBIG Penalty Condonation Program can provide significant financial relief.

Here are some tips to help you navigate the process:

  1. Prepare All Required Documents: Before you apply, gather all the necessary documents. This includes the Application for Condonation of Penalties/Additional Interests Form, updated Real Estate Property Tax Receipt/Tax Clearance, Tax Declaration, valid ID, and if necessary, a notarized Special Power of Attorney. Make sure these are all up-to-date and correctly filled out to avoid any delays.
  2. Understand the Process: Review the application process thoroughly so you know what to expect. This can help you prepare for each step and make the process smoother.
  3. Stay Informed: Stay updated about the program’s rules and regulations. Ensure you understand the terms and conditions of the program.
  4. Seek Assistance: Don’t hesitate to ask for help from Lingkod Pag-IBIG personnel if you have any questions or concerns. They can guide you through the application process and provide clarity on any points of confusion.
  5. Act Promptly: If you’re eligible for the program, don’t delay your application. The sooner you apply, the sooner you can benefit from the program and get relief from penalties and additional interests.
  6. Keep Track of Your Application: After you’ve submitted your application, keep track of its status. Wait for a call from Lingkod Pag-IBIG personnel regarding the status of your application, but don’t hesitate to follow-up if necessary.

Remember, the goal of this program is to provide relief to borrowers. Make the most of it by being proactive, prepared, and informed.

Frequently Asked Questions

1. What is the Penalty Condonation Program?

The Penalty Condonation Program is a scheme that allows borrowers to waive all penalties and additional interests incurred by fully updating or fully paying their housing loan account.

2. Do I need to pay a processing fee to apply for the Penalty Condonation Program?

No, there is no processing fee required to apply for the program.

3. How will I know if my application has been successful?

You will receive a call from Lingkod Pag-IBIG personnel to notify you of the status of your application.

4. What should I do if my application is rejected?

If your application is rejected, it’s best to speak with Pag-IBIG personnel to understand why and see what steps you can take to rectify the situation.

5. Can I apply for the Penalty Condonation Program more than once?

The rules may vary, so it’s best to check with Pag-IBIG directly. However, the program is generally designed as a one-time relief for borrowers who have fallen behind on their payments.


The Pag-IBIG Condonation Program is a great opportunity for those who have incurred penalties and additional interests on their housing loans. This program allows borrowers to waive these fees and pay only the principal amount of the loan. This is a timely solution for individuals who are experiencing financial difficulties.

With the Condonation Program, borrowers have a chance to start with a clean slate and get back on track in paying off their housing loans. This is a great way for Pag-IBIG members to take advantage of the government’s efforts to ease the burden of loan payments during these challenging times.

Contact Information

Phone: 02 8724 4244
Facebook Page:

Photo of author


Hi, I am Laika and I am a full-blooded Cebuana, born and raised in Toledo City, Cebu. A mother of 2 girls. I love spending time with my family, watching movies and exploring the beauty of nature. For collabs, email me at

Leave a Comment