The Department of Education recognizes this problem and understands how it affects the financial well-being of teachers. To help address the issue, DepEd entered into a Memorandum of Agreement with the Land Bank of the Philippines for the DepEd–LandBank Loan Take-Out Program. Through this program, LandBank will take over qualified teachers’ existing loans from private lenders.
The growing number of loan deductions from teachers’ salaries has become a serious concern. Many teachers now realize that the biggest burden is not the loan itself, but the high interest that comes with it. As a result, some teachers receive only the minimum ₱5,000 take-home pay, while they still need to pay other lenders outside their salary deductions. Because of this, many families continue to struggle financially.
This page will guide you through the DepEd–LandBank Loan Take-Out Program. It also explains important details about the program, clears up misleading information, and discusses the application process. More importantly, the program aims to help teachers improve their cash flow and reduce their financial burden. Many teachers are now hopeful that they can become beneficiaries of this initiative, which is one of the department’s direct efforts to support teachers and their financial welfare.
Will the teachers’ loans from private lenders be erased?
There are posts on various social media platforms claiming that the Department of Education plans to erase teachers’ loan debt through this program. First, we would like to deny these claims clearly. The department will not pay the loans or take full responsibility for settling them. However, the good news is that DepEd continues to find ways to help teachers manage their loan payments and avoid financial difficulties.
The DepEd-LandBank Loan Take-Out Program is the department’s first direct step to address this concern. Through this program, LandBank may pay off teachers’ existing loans from private lenders. After that, the bank will recompute the loans using lower interest rates and longer payment terms. Because of this, teachers will no longer deal with their private lenders. Instead, they will have a new loan agreement with LandBank under more manageable terms.
Department of Education-Land Bank of the Philippines Loan Take-out Program: Explained
The Department of Education and the Land Bank of the Philippines launched the Loan Take-out Program to help public school teachers and non-teaching personnel struggling with heavy salary deductions from private loans.
Through this program, LANDBANK will refinance the existing loans of qualified DepEd employees. Because of this, borrowers can enjoy lower interest rates and easier payment terms. The annual interest rate also dropped from 7% to 6.5%, which is much lower than the rates charged by some private lenders that reach up to 3% per month.
The program may help around 1,000 affected personnel. It also aims to restore at least ₱5,000 in take-home pay for employees whose salaries were greatly reduced by loan payments. According to Sonny Angara, the program seeks to improve the financial situation of teachers so they can focus more on teaching and supporting learners.
How to apply to this program?
As of now, the DepEd and the Landbank have identified around 1,000 teachers and non-teaching personnel for the program. These selected employees are currently undergoing evaluation and processing.
At present, DepEd has not yet opened a public application process for all employees. However, the department is expected to release an official memorandum in the coming months. This memorandum will include the guidelines, qualifications, requirements, and application procedures for the program. In addition, DepEd is also expected to expand the program in the future to accommodate more interested applicants.
Teachers and personnel are advised to wait for official announcements from DepEd and LANDBANK regarding:
- Eligibility requirements
- Required documents
- Application process
- Schedule of orientation activities
- Participating offices and divisions
FAQs
What is the DepEd–LANDBANK Loan Take-out Program?
The DepEd and the Landbank partnered to help teachers and non-teaching personnel refinance their existing loans from private lenders. Through this program, borrowers can enjoy lower interest rates and better payment terms.
Who can benefit from the program?
The initial implementation targets around 1,000 identified DepEd personnel with heavy salary deductions and loan-related salary garnishments.
Can all teachers apply now?
Not yet. The current batch consists of pre-determined beneficiaries who are already undergoing evaluation and processing.
What is the interest rate under the program?
The annual interest rate was reduced from 7% to 6.5%, making it more affordable compared to some private lending institutions.
What loans can be refinanced?
Existing loans from private lending institutions (PLIs) may be qualified for refinancing under the program.