GSIS offers loan relief program for teachers

THE Government Service Insurance System (GSIS) will start to accept on Tuesday applications for the GSIS Financial Assistance Loan (GFAL) program for teaching personnel of the Department of Education (DepEd).

In a statement, the state-run pension fund said it will lend a maximum of P500,000 to DepEd borrowers under the GFAL program in pay down outstanding balances of loans extended by eligible private lending institutions.

Under GFAL, qualified applicants may borrow up to P500,000 provided that they have a take home pay of P5,000 after deduction of monthly obligations.

Borrowers may consolidate their loans and transfer the total amount to GSIS if they are indebted to more than one private lender.

The interest rate of the GFAL program is 6% per annum computed in advance payable in monthly installments for six years. Payments will be automatically deducted from the borrower’s salary.

Jesus Clint O. Aranas, GSIS president and general manager, said the GFAL program is a balance transfer and debt-consolidation facility in one.

“It allows the members to take a second look at their spending habits — if they are heavy borrowers, they might be spending beyond their means,” Mr. Aranas was quoted as saying in the statement.

DepEd personnel may qualify for the GFAL program if they are active and regular GSIS members with permanent status and paid premiums for the last three years.

Borrowers must not be on leave without pay, have an outstanding loan from DepEd-accredited lending institutions and have no due and demandable loan account with the pension fund.

Mr. Aranas added that the pension fund opted to open the GFAL program nationwide instead of conducting a pilot run in selected areas.

“We decided to open it to all teachers and teaching personnel nationwide because we want more teachers to benefit from lower interest rates and better terms of payment from GSIS,” Mr. Aranas said.

“Reduced interest rates and smaller amortization spells savings and higher take-home pay for our members. This will definitely lighten their load.”

Last month, GSIS and DepEd signed a memorandum of agreement witnessed by President Rodrigo R. Duterte to help teachers and other employees manage their finances, and keeping them from becoming too indebted. —