THIRTEENTH CONGRESS OF THE 
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Introduced by SENATOR LUISA “LOI” P. EJERCITO ESTRADA 
EXPLANATORY NOTE 
The scarcity of affordable housing affects all sectors of society especially our 
public school teachers where an independent survey revealed that more than ninety 
thousand (90,000) public school teachers have no homes to call their own. 
Majority of these public school teachers cannot afford their own homes at market 
prices since they earn a gross monthly income of P10,OOO or less. In addition to this, 
more than 20% of our public school teachers have unemployed spouses and thus, bears 
the burden of providing for their family. 
In 1999, there were efforts to solve this problem by providing for a special 
homing facility through the state pension fmd. However, its implementation got caught 
up in the web of politics and never materialized. Thus, it is imperative that we provide for 
a stable housing program for our teachers through legislation. 
This bill seeks to institute a housing program for teachers by providing funds 
through loans at affordable interest and long-term repayment period, which our teachers 
can use to purchase a housing unit of their own choice. It also seeks to involve the private 
sector in providing housing units exclusively for teachers through the grant of 
fiscal incentives. 
In view of the foregoing, the passage of this bill is earnestly sought. 
n 
L 
LUISA “LOI” 
ESTRADA 


THIRTEENTH CONGRESS OF THE 
1 
REPUBLIC OF THE PHILIPPINES 
) 
First Regular Session 
) 
SENATE 
S. B. No. 
Introduced by SENATOR LUISA “LOI” P. EJERCITO ESTRADA 
AN ACT 
TO PROVIDE FOR A HOUSING PROGRAM FOR TEACHERS 
Be it enacted by the Senate and the House of Representatives of the Philippines in 
Congress assembled: 
SECTION 1. Title. - This Act Shall be laown as the “Teacher’s Housing 
Program.” 
SEC. 2. Declaration of Policy. - It is hereby declared the policy of the State to 
uplift the living conditions of teachers and promote a housing program to enable them to 
acquire their own housing units. 
To this end, the State affirms its coiniiiitment to 
strengthen, promote, and support the component activities of housing production and 
finance in order to enable teachers to acquire decent housing and basic services at the 
lowest affordable price. 
SEC. 3. Coverage. - 
The Program shall cover all teachers of the Department of 
Education (DepEd) with a permanent status. 
SEC. 4. Role of Government Housing; and Financing Agencies. - To ensure the 
accomplishment of the objectives under this program, the hereunder mentioned housing 
agencies shall perform the following in addition to their respective existing powers and 
functions; 
(a) 
The National Housing Authority shall undertake special housing 
projects for teachers. In addition, it may also provide technical and 
other forms of assistance to private developers in the development 
of housing projects with the objective of augmenting and 
enhancing capabilities in the provision of housing benefits to 
teachers; 


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E 
(b) 
The National Home Mortgage Finance Corporation shall provide 
the mortgage market for teacher's housing through the purchase of 
teacher's housing mortgages and/or issuance of securities. It shall 
administer the funds provided for housing loans and developer 
assistance under this Act as well as long-term funds provided by 
the Government Service Insurance System and the Home 
Development Mutual Fund for teacher's housing. 
(c) 
The Home Guaranty Corporation shall design an appropriate 
guarantee scheme to encourage financial institutions and private 
developers to undertake mass housing production for teachers. It 
shall administer the Guarantee System Fund as provided for under 
this Act. 
(d) 
The Government Service Insurance System and the Development 
Mutual Fund shall be the primary provider of funds for long-term 
housing mortgages. 
SEC. 5 .  Role of the DepEd. - The Department of Education shall undertake the 
impleinentation of the Program among its teachers and shall ensure collection of 
amortization payments through a salary deduction scheme. In line with this, the DepEd 
shall: 
(a) 
Create a Teacher's Housing Secretariat which shall issue and 
collect the necessary documentation, receive and process 
application, and transfer the same to the appropriate housing 
agencies- 
(b) 
Deduct amortization from their teachers on a monthly basis and 
remit the same to the appropriate agency. 
SEC. 6. Program Financing Scheme. - 
In the implementation of the Teacher's 
Housing Program, the following shall consist the financing scheme; 
(a) 
Housing Loans for Teachers which shall be used for any of the 
following purpose: 
1. Purchase of a lot and construction of a residential unit thereon; 


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2. Purchase of any of the following: 
i. 
11. 
111. 
housing assets being disposed off through public 
brand new or old existing units; 
housing properties mortgaged with any institution; 
.. 
... 
bidding or negotiated sale; 
3. Purchase of a fully developed lot within a residential area; 
4. Construction or completion of a residential unit on a lot owned 
by the beneficiary; 
5. Home improvement or any alteration in an existing residential 
unit; 
6. Restructuring of an existing housing loan in any government 
housing of financial institution, provided that the account is 
updated. 
Loans provided under this program shall be computed based on a 
net take home pay which shall not be lower than Three Thousand Pesos 
(P3,OOO). The interest rate on the loan shall not be more than twelve 
percent (12%) per annum and shall be fixed for the entire term of the loan. 
Provided, that if the borrower defaults on his amortization payment for 
reasons of his own doing, the financing agency may subject the borrower 
to a regular interest rate for the periods that he is in default. 
To increase the benefits provided to teachers, loans under this 
scheme shall not be subject to such charges, fees or premiums except 
minimum processing fees to be charged by the appropriate agencies. 
Loans provided for teachers earning less than twelve thousand 
pesos (P12,OOO) per month shall not be less than sixty percent (60%) of all 
available funds allotted for the purpose- At least forty five percent 
(45%)of the yearly appropriation for the Program shall be for Housing 
Loans. 
(b). 
Developer Assistance Fund. - Proponents or developers of 
housing projects exclusively for teachers and with a selling cost 


-- 
not 
exceeding 
One 
Hundred 
Twenty 
Thousand 
pesos 
(P120,OOO.OO) per house and/or lot package which shall be 
available exclusively for teachers, may avail of a financing loan 
not exceeding eighty percent (80%) of the entire project cost. The 
National 
Home 
Mortgage 
and 
Finance 
Corporation, 
in 
coordination with the HUDCC, shall issue the appropriate 
guidelines for this purpose. 
At least fifteen percent (15%) of the yearly appropriation for the 
Program shall be for developer financing: Provided, that the unused funds 
for developer financing shall be utilized for Housing Loans. 
(c) 
Guarantee System Fund. - 
There is hereby created a guarantee 
system fLind for Teacher's Housing Loans not exceeding One 
Hundred Fifty Thousand Pesos (P150,OOO.OO) with an interest rate 
of not exceeding twelve percent (12%) per annum as originated by 
the funding agencies or their accredited financial institutions. Such 
loans shall be assigned to the Fund immediately after origination 
for which the Fund shall issue promissory notes. 
At least forty percent (40%) of the yearly appropriation for the 
Program shall be for the loan guarantee. The Home Guarantee Corporation 
shall undertake the guarantee system under this act and shall act as the 
administrator and trustee of the fund. The HGC shall issue the appropriate 
guidelines within one (1) year from the approval of this act. 
SEC. 7. Fiscal Incentives for Private Sector Participation in Teacher's 
Housing;. - Private sector developers who participate in the development of teacher's 
housing shall be entitled to the following fiscal incentives: 
(a) 
Exemption from income taxes for housing projects exclusively 
dedicated for teachers; 
Exemption fiom capital gains tax on raw lands used for the project; 
Exemption from documentary stamp tax for all project related 
(b) 
(c) 
documentation; 
(d) 
Exemption fiom value-added tax for the project concerned; 
(e) 
Exemption fi-om transfer taxes for both raw and completed 
projects; and 


Y 
(f) 
Exemption from donor’s tax for lands certified by the local 
government units to have been donated to teacher’s housing 
purposes. 
Provided, that upon application for exemption, the housing development plan 
shall have already been approved by the appropriate government agencies concerned: 
Provided further, that all the savings acquired by virtue of this provision shall be used to 
minimize the cost of the housing units subject to the implementing guidelines to be issued 
by the Housing and Urban Development Coordinating Council. 
The Department of Finance, in consultation with the Housing and Urban 
Development Coordinating Council, shall prepare the necessary implementing guidelines 
for the proper implementation of the tax exemption mentioned in this section within one 
(1) year after the approval of this Act. 
SEC. 8. Funding Source. - The Government Service Insurance System and the 
Home Development Mutual Fund shall contribute a total of Two Billion Pesos 
(P2,000,000,000) for the initial implementation of the Program. Thereafter, each 
institution shall allocate at least ten percent (10%) of their annual investible ftinds for 
long-term teacher’s housing mortgages and shall be made available to the National Home 
Mortgage and Finance Corporation under terms which ensure their repayment. 
The 
National Government shall contribute One Billion Pesos (P 1,000,000,000)annually for 
the continuous implementation of the Program. 
SEC. 9. Appropriation. - The amount necessary to carry out the purposes of this 
Act shall be included in the General Appropriations Act of the year following its 
enactment into law and every year thereafter. 
SEC. 10. Separability. - If for any reason, any provision of this Act is declared 
invalid or unconstitutional, the remaining provisions not affected thereby shall continue 
to be in fdl force and effect. 
SEC. 11. 
Effectivity. - This Act shall take effect fifteen (15) days after its 
complete publication in at least two (2) national newspapers of general circulation. 
Approved, 
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