Sunday, July 06, 2008 Speaker hits housing firm for deception
HOUSE Speaker Prospero Nograles is angered by the alleged deception made by the Balikatan Housing Finance Inc. (BHFI).
Nograles said the House was led to believe by the BHFI that they are doing something to prevent their customers from losing their homes but when in fact it is making things worse.
According to him, BHFI promised Congress that it would only foreclose homes as a last resort and it would restructure these housing loans to allow those concerned to pay their obligations under easier payment terms.
Balikatan is the special purpose company that took over the delinquent accounts of mass housing beneficiaries.
The National Home Mortgage Finance Corporation (NHMFC) had earlier transferred to the Balikatan (BHFI) thousands of delinquent loan accounts for proper disposition.
As it turns out, however, the BHFI was only trying to lead the House into believing that the housing beneficiaries were already safe from being ejected from their homes.
This conclusion came after Nograles, through his son and chief-of-staff lawyer Karlo Nograles, discovered that the BHFI was demanding exorbitant downpayment rates as a prerequisite for loan restructuring.
"This is totally unacceptable. The basic concept of loan restructuring is to give the housing beneficiaries a better deal so that they can keep their homes. Imposing impossible rates is almost like foreclosure too," Speaker Nograles said.
He recalled a recent congressional inquiry where these top officials of the government's private housing partner vowed to make terms easier for delinquent homeowners facing foreclosure.
"I feel deceived because all along I was led to believe that the housing beneficiaries who were in danger of losing their homes were already safe and secure. The House should continue with its investigation on BHFI," Nograles added.
It was learned that the BHFI agreed to stop the foreclosure of some 50,000 out of 52,000 delinquent accounts, which it purchased from the National Home Mortgage and Finance Corporation (NHMFC) at discounted rates, but only if these homeowners agree to pay 25 percent of the total cost of their outstanding loans.
"Asking for a 25 percent downpayment is a glaring contradiction to the intent of the government's low cost mass housing program," Nograles said.
He said that during the congressional inquiry, Balikatan officials stressed their policy that foreclosure would only be a last resort. This inquiry was presided on by Oriental Mindoro Representative Rodolfo Valencia, Chairman of the House Committee on Housing and Urban Development.
Valencia said officials of BHFI assured his committee that they would take into consideration all possible options so borrowers would be able to amortize their restructured loans.
Nograles said the House of Representatives would press on with its investigation on the foreclosures of some 52,000 low-cost and socialized housing units. (Press release)
