Homeless People’s Federation Philippines, Inc.

Western Visayas-Iloilo City

PROJECT PROPOSAL

I. Project Title: West Timawa Community-led Onsite Land Acquisition Project

II. Name of Community/ Proponent: West Timawa People’s Organization (WTPO)

III. Source of Fund: PACSII CLIFF Repayment Collection Fund and other available
PACSII Funds; 30% Equity of the total cost of the land shall be the
counterpart of West Timawa People’s Organization.

IV. Amount: ₱6,776,000.00

V. Rationale:
There is a need to provide immediate land acquisition loan to West Timawa
People’s Organization which has successfully negotiated the sale of a parcel of land they
currently occupy as informal settlers. There is urgency for land acquisition because the
landowner, considering the strategic location of the land for business or other commercial
activities, its proximity to schools, colleges and universities, hospitals, malls, public
facilities and amenities among others has received several offers to buy the subject land
and has considered accepting the offer. The owner threatened to evict families in favor of
interested buyers but the community with the intervention of the City Mayor and HPFPI
has successfully negotiated to purchase the land instead.
The land has a total area of THREE THOUSAND NINE HUNDRED EIGHTEEN
SQUARE METERS (3,872 sq.m.) and is only being sold to the community for 2,500, a
relatively small amount compared to its current market value worth four to five thousand
pesos per square meter. To date, the community, with the intervention of HPFPI, has
secured its registration as a people’s organization and has successfully confirmed the
veracity of the current landowner and his proof of ownership based on the present records
of Iloilo City Registry of Deeds and Assessors Office. To secure land acquisition
agreement, the West Timawa People’s Organization has likewise signed a contract to sell
with the landowner indicating terms, conditions and schedules of payments in three
installments. The community has demonstrated its dedication, eagerness and
commitment to buy the land through prompt and timely payment of its counterpart to the

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landowner consisting of the thirty percent of the total land cost worth Two Million Nine
Hundred Thirty Eight Thousand Five Hundred Pesos Only (₱2,904,000.00) as part of their
land acquisition savings.

VI. Objectives:
To assist and help organize communities in the informal settlements towards their
security of land tenure and housing cognizant with HPFPI’s slum upgrading initiative.

Specifically, the project aims:

 Make available and accessible loan amount for land acquisition particularly to poor
but economically active households;
 To provide technical, consultation and facilitation assistance in land acquisition
procedure especially in land negotiation and compliance with documentary
requirements;
 To help organize, strengthen, mobilize and operationalize newly established
community association;
 To introduce savings as a prerequisite in accessing land acquisition loan and help
develop the habit of savings which will eventually mobilize the community’s
internal resources

VII. Community Profile:

West Timawa People’s Organization is a non-stock corporation duly registered
with the Securities and Exchange Commission (SEC) last June 2, 2016. It is composed
of 59 informal settlement families (ISFs) occupying a parcel of land with a total area of
5,540 square meters owned by Mr. Ramon dela Cruz. The land is located at Brgy. West
Timawa, Molo, Iloilo City, strategically situated along the Iloilo City’s main road, proximate
to Iloilo Doctors Hospital and University of the Philippines, Iloilo City Campus.
The settlement which was previously owned by Consing, Yulo and Yusay families
was established in the early 1980s. Majority of the informal settlement families are aware
that there occupancy in the subject lot is only by mere tolerance of the owner. Some of
them have initiated steps to secure their land tenure by direct negotiation with the land
administrator, Yulo, through sale or leasehold agreement. A number of them claimed to
have paid considerable amount to Yulo in consideration of their permanent stay in the lot
but have found out that while payment was made and land negotiation was conducted,
the owner has already mortgaged the subject lot to Ramon dela Cruz. Individual efforts
to secure land tenure were unsuccessful and collective efforts were taken into
consideration. Thus in late 1990s, informal settlement families decided to establish a
community association and avail of the government’s community mortgage program

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(CMP). The conditions of the program and the challenges of unmanageable community
dynamics however led to the dissolution of the association.
To date, West Timawa People’s Organization has actively taken the lead role in
land negotiation towards security of land tenure. The Iloilo City Government through
Mayor Jed Patrick Mabilog facilitated the meeting and initial discussion between West
Timawa People’s Organization and Homeless People’s Federation Philippines, Inc. for
potential partnership last November 2015. HPFPI has since provided social preparatory
and mobilization assistance which included consultation, facilitation and legal assistance
on the association’s formal registration, land acquisition procedure, community
organizing, savings for land, site development and subdivision planning among others.

VIII. Proposed Terms and Conditions

1. Total Loan Amount Granted: _______________________

2. Proposed Loan Amount: P 6,776,000.00 (Six Million Seven Hundred
Seventy Six Thousand Pesos Only)
3. Type of Loan: Land Acquisition Loan
4. Parties to the Loan Contract: Loan contract shall be made and signed
between the Philippine Action for Community-led Shelter Initiative, Inc.
(PACSII) as LENDER, the West Timawa People’s Organization (WTPO) as
BORROWER and the HPFPI National President. The signatories to the loan
contract must be duly authorized by their corresponding organizations’ board
members as evidenced by a Board Resolution and Secretary Certificate.
5. Interest Rate: The interest rate applicable to Land Acquisition Loan is 8% per
annum based on the straight computation method;
6. Schedule of Payment: Monthly (not later than the 5th day of the succeeding
month)
7. Term of Payment: The total loan amount is payable within a minimum period
of 5 years and a maximum period of 7 years;
8. Mortgage Redemption Insurance (MRI): All loan amount shall be covered
under HPFPI’s Mortgage Redemption Insurance (MRI) Policy with Country
Bankers Life Insurance Corporation (Country Bankers). HPFPI Regional Office
shall request Country Bankers to conduct an orientation on MRI which shall be
attended by all qualified loan borrowers. Upon first payment of the monthly
amortization, individual loan borrowers are required to fill-up and submit MRI
application to HPFPI Regional Office. Thereafter, HPFPI Regional Office shall
send the consolidated MRI application to Country Bankers under the HPFPI
main MRI Policy. Upon approval of application, individual certificate of

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 coverage (COC) issued by Country Bankers, shall be distributed to loan
borrowers by HPFPI Regional Office. The original copy shall be given to the
loan borrower while the duplicate copy shall be retained by the Regional Office.
All MRI claims shall be made and processed by the HPFPI Regional Office
upon submission by the deceased loan borrower’s declared beneficiaries of all
the documentary requirements prescribed by Country Bankers Life Insurance
Corporation.
9. Urban Poor Development Fund (UPDF): Loan borrowers are mandatorily
required to have a non-withdrawable Urban Poor Development Fund (UPDF)
Savings worth 100 pesos per month. This fund shall be retained in the local
HPFPI bank account and can only be utilized as a common association fund
for additional community identified upgrading project or any other project
identified by the community which will benefit them collectively upon full
payment of their loan obligation. Upon full payment of all the loan obligation,
the community association shall make a formal request to access the savings
supported by a project proposal. The proposal shall then be submitted to the
HPFPI Regional Office for review and approval by the Regional Council
10. Disbursement of Loan Amount Granted: Upon approval of the loan, the total
loan amount granted shall be released by HPFPI National Office to HPFPI
regional office. Thereafter, the HPFPI regional office shall disburse the total
loan amount to the WTPO.
11. Repayment Default:
12. Penalty: 5% of the monthly amortization due of the Ca /HOa (computed based
on the total principal and interest due for the month) shall be charged as a
penalty in case of repayment default and shall be retained by HPFPI Regional
Office for local repayment collection related activities. The penalty should be
automatically deducted from the monthly repayment of the succeeding month.
Thus, despite full payment for the succeeding month, the community
association shall still incur additional penalty if outstanding penalty are unpaid
due to automatic deduction from the monthly amortization. In order to avoid
imposition of penalty therefore, the association should pay the penalty on top
of the monthly amortization due of the succeeding month. The imposition of a
higher penalty rate is intended to create an impression of burden in the minds
of the loan borrowers in case of loan default and thus is expected to create a
better repayment rate.
13. Issuance by the CA/HOA of a Post-dated Check: CA/HOA borrower is
obliged to issue post-dated checks indicating the monthly amount due and
corresponds on the monthly due dates (not later than the 5th day of the

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 succeeding month) upon disbursement of the loan amount. The post-dated
check issued by the borrower is intended to enforce payment of the association
due for the month. If the association failed to deposit the monthly monetary
obligation through the post-dated check, the Regional Office shall deposit the
bounced check resulting to criminal liability on the part of the WTPO.
14. Failure of CA to Pay Loan Obligation within agreed Loan Period/Term:
Upon termination of the loan term, all outstanding balance shall be due and
demandable.
15. Bank Deposit of Repayment Collection: All repayment collection shall be
deposited on a monthly basis (every 5th day of the succeeding month) by the
WTPO to the HPFPI regional/local bank account for recording, reconciliation
and monitoring purposes;
16. Remittance to Philippine Action for Community-led Shelter Initiative, Inc.
(PACSII): Total repayment collection shall be remitted to Philippine Action for
Community-led Shelter Initiative, Inc. (PACSII) annually. Upon receipt of the
remitted repayment collection, HPFPI shall demand acknowledgment receipt
and official receipt from Philippine Action for Community-led Shelter Initiative,
Inc. (PACSII).
17. Documentary Requirements:
 Copy of the Contract to Sell between WTPO and the landowner
 Zoning ordinance classifying the area as Residential
 Certified True Copy of the Land Title
 Structural Survey
 Updated Tax Declaration of Real Property
 BIR’s Zonal Valuation of the subject property
 Assessed Value of the Property
 Certificate of Registration of the WTPO
 Board Resolution authorizing the WTPO President to execute and sign loan
contract with PACSII and HPFPI
 List of individual borrowers with corresponding lot area and record of
payments for the Equity
 Consolidated affordability assessment report
 Post-dated checks

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Figure 1. Meetings with the Technical Working Group (TWG) or West
Timawa People’s Organization (PO) Officers

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Figure 2. Subdivision Plan of West Timawa People’s Organization

Figure 3. Profiling and mapping of West Timawa Informal Settlement

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Figure 4. Contract to Sell between WTPO and Landowner

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Figure 5. List of Household Heads/ Potential Land Acquisition Loan Borrowers

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Figure 6. Board resolution authorizing PO President to enter into a loan agreement

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Figure 7. Secretary's Certificate

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Figure 8. SPA from ex-wife authorizing sale of lot

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Figure 9. Consolidated Affordability Assessment Report

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Figure 10. Land Title

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Figure 11. Tax Declaration of Real Property

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Figure 12. Official Receipt of Tax Payment

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Figure 13. Tax Clearance

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Figure 14. BIR Zonal Certification

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Figure 15. Certificate of Zoning Classification

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Figure 16. SEC Registration of West Timawa People’s Organization

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