GUIDANCE NOTE FOR RSA HOLDERS, MORTGAGE LENDERS AND PENSION OPERATORS
The move to allow retirement savings account (“RSA”) holders, to finance residential mortgage with part of their pension funds, has its origin in the Pension Reform Act of 2014 (the “Act”). Under
section 89(2) of the Act, a Pension Fund Administrator (“PFA”) is allowed to apply a percentage of the pension assets in the RSA towards financing the equity contribution required to be made
by a RSA holder to secure residential mortgage. The allowable percentage of the pension assets and other applicable terms and conditions are to be determined by guidelines issued, from time to time, by the National Pension Commission (“PenCom”). In furtherance of this provision, PenCom issued the Guidelines on Accessing Retirement Savings Account (RSA) Balance towards Payment of Equity Contribution for Residential Mortgage by RSA Holders on September 26, 2022 (the “Guidelines”). Read more
