State-owned Development Bank of the Philippines (DBP) has opened a new financing facility aimed at assisting housing developers to expand their housing projects through DBP’s purchase of receivables covered by a Contract To Sell (CTS), a top official said.
DBP president and chief executive officer Emmanuel G. Herbosa said the Contract To Sell Financing Facility for Real Estate Developers, or the CTS Program, is also meant to stimulate the continuous development of housing facilities by Key Shelter Agencies (KSAs) to address the backlog in the housing industry.
“The CTS Program boosts housing developers’ capacity to undertake more housing projects, especially in underserved areas and for lower-income groups,” Herbosa said.
DBP is the eight largest bank in the country in terms of assets and has been designated as the country’s infrastructure bank by the National Government. It provides loans to strategic sectors including the establishment or expansion of agricultural or industrial enterprises.
Based on latest data, the National Government has targeted production of more than 1.5 million units by 2022, which is below the estimated backlog of two million units. Industry observers expect the housing demand to grow to up to six million units by end-2021.
Herbosa said prospective borrowers under the CTS Program are required to have at least a three-year track record and possess requisite government licenses.
He said eligible developers must have no derogatory findings or any adverse records or credit findings with housing regulators and maintain satisfactory credit experience with trade suppliers and contractors.
“DBP may extend financing assistance of up to 80 percent of the Total Contract Price of the CTS outstanding balance. The interest on this program is based on prevailing market or interest rates,” Herbosa said.
The CTS Program is an integral component of the National Government’s holistic approach to bridge the housing gap and fuel the growth momentum of the housing industry, he added.
For more details about the CTS program, interested entities may inquire with the nearest DBP lending center in their area.