The Commission on Audit (COA) has warned that 22,123 borrower-members of the Home Development Mutual Fund (HDMF), more popularly known as Pag-IBIG Fund, were at risk of losing their homes, because the housing developers have yet to convert the contracts to mortgages under their names.
In its 2017 annual audit report, the COA urged Pag-IBIG to compel the developers to speed up the conversion of the contracts to sell (CTS) to real estate mortgages (REM).
Auditors found that the accounts of the 22,123 borrowers—amounting to P14.41 billion in loans—have not been converted to mortgages within the deadline set by HDMF Circular No. 298.
Titles of properties
Since the CTS accounts have not been converted by the developers to REM, the titles of the properties could not be transferred in the name of the buyer-borrowers.
Under the circular, developers would be required to buy back the accounts that were overdue for conversion to REM.
“Nonconversion of the accounts from CTS to REM is … detrimental to the interest of the updated housing loan borrowers as their ownership over the property is exposed to risk,” read the report. —Vince F. Nonato