Members of the Social Security System can look forward to higher salary loan amounts and more flexible terms under the agency’s revised lending guidelines that took effect December 1, a press release from SSS said.

SSS president and chief eExecutive officer Emilio de Quiros, Jr. said the new guidelines, which were approved by SSS’ governing board called the Social Security Commission on April 18, 2012, aim to align the SSS salary loan program with prevailing market conditions.

The SSS deferred the guidelines’ implementation to prepare its computerized loan system for the changes and to avoid disrupting the processing of members’ applications for the Loan Penalty Condonation Program, which was open for availment from April 2 to September 30, the press release said.

Under the new salary loan guidelines, members can file for renewal if they have already paid at least 50 percent of the principal loan amount and at least half of the two-year loan term has lapsed.

In the past, members can only renew their loan if the outstanding balance is P500 or lower.

De Quiros said that while loanable amount remains based on the average of the members’ latest 12 posted monthly salary credits, the new guidelines provide a maximum salary loan of P30,000, higher than SSS’ previous cap of P24,000.

The loan shall be amortized over a 24-month period and the 10 percent annual loan interest will apply to the diminishing principal balance.

Moreover, the first year’s 10 percent interest shall no longer be deducted in advance, which translates to bigger net loan proceeds, the press release said.*

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