INSTALLMENT SALES
RECTO LAW – ACT. NO. 4122
COVERAGE: Article 1484 of the Civil Code provides for the remedies of a seller in contracts of
sale of personal property by installments, and incorporates the provisions of Act No. 4122
passed by the Philippine Legislature on 9 December 1939, known as the “Installment Sales
Law,” but more popularly referred to as the “Recto Law,” which then amended Article 1454 of
the Civil Code of 1889.
APPLICABILITY:
Applies to a contract of sale of personal property the price of which is payable in
installments.
The law applies only in case of “installment” sales (including rent-to own of movables)
Not to sales “on credit”. (Down payment and balance: installment)
The law applies to contracts purporting to be leases of personal property with option to
buy (rent-to-own), when the lessor has deprived the lessee of the possession or
enjoyment of the thing.
REQUISITES: SALE, INSTALLMENT, MOVABLE
ALTERNATIVE REMEDIES OF THE SELLER:
The seller will have the ff. Remedies in case of non-payment of the buyer:
1. EXACT FULFILLMENT OF THE OBLIGATION, should the vendee fail to pay (acceleration
clause – pay balance immediately, demand the balance, no interest because of depreciation);
NOTE: Does not bar full recovery for judgment secured may be executed on all personal and real
properties of the buyer which are not exempt from execution (Palma v. CA.)
2. CANCEL THE SALE, should the buyer’s failure to pay cover two or more installments (cancel
or rescind-restitute, requirement is non-payment of two or more);
3. FORECLOSE THE CHATTEL MORTGAGE on the thing sold (the thing itself), if one has
been constituted, should the vendee’s failure to pay cover two or more installments
(requirement is nonpayment of two or more) (mga binayad ng buyer ay iki-keep ni seller dahil
they will be treated as rental payments.)
NOTE: The remedies are alternative. As such, if the seller/vendor invoked one, he can longer
invoke any of the two remaining remedies. Any agreement to the contrary shall be VOID
EXAMPLE: RECTO LAW
1. S sold B a motorcycle for a price of 100,000 secured by a chattel mortgage on the motorcycle. B
is required to pay a downpayment of 50,000 and the balance is payable on or before December 31,
2022.
Q: If B fails to pay on due date and S foreclosed the mortgage on the motorcycle, but resulted in a
deficiency balance of $10,000, can S still collect the deficiency?
A: Yes. Since the sale is "on credit" and not "in installment" (balance is to be paid one time big time), the
Recto Law would not apply. As such, the remedies of the seller being alternative is not applicable.
2. S sold to B a motorcycle for a price of P100,000 secured by a chattel mortgage on the
motorcycle, payable in 10 equal monthly installments. B failed to pay the first installment.
Q: Can S foreclose the mortgage or cancel the sale?
A: No. the sale of personal property being in installments is covered by the Recto Law. As such, in order
to invoke the 2nd (cancellation of the sale) or 3rd option (foreclosure of chattel mortgage), it requires the
non-payment of at least TWO installments.
In this illustration, if there were two or more installments that were not paid, then the 2nd and 3 option are
now available for the seller. But, being alternative in nature, if the seller opted to cancel the sale, he can
no longer recover the deficiency price under option 1 or foreclose the mortgage.
FORFEITURE OF INSTALLMENTS
The 2nd option of cancelling the sale would entail mutual restitution (balikan) by the parties.
GENERAL RULE: The seller is allowed to retain a reasonable amount of the purchase price
already paid as compensation for the use of the thing (rent0, or ALL of the amount paid only if
there is a forfeiture clause which entitles him to the purchase price already paid at the time of
cancellation (for depreciation of the property).
EXCEPTION: a stipulation that the installments or rents paid shall not be returned to the vendee
or lessee shall be valid insofar as the same may not be unconscionable under the
circumstances (Article 1486)
FORECLOSURE OF THE CHATTEL MORTGAGE
The 3rd option entails that the foreclosed mortgage is the mortgage on the personal property
itself (mismong subject matter of the sale), and in case of deficiency of the foreclosure sale
proceeds, the seller in NOT entitled to recover such, since recovery of the deficiency falls under
option 1.
However, if what is foreclosed is another security or a mortgage on different property, the
prohibition to collect the deficiency would not apply, since foreclosure of a mortgage of a
different thing precisely falls under option 1 also. (seller may collect the balance kung may iba
pang security/mortgage kasi kaya mo nga finoreclose yung another security is para ma-recover
mo yung purchase price AT yung foreclosure ay hindi na over the thing sold)
NOTE:
Further recovery barred only from the time of actual sale at public auction conducted pursuant to foreclosure
(Macondray vs. Tan)
Other chattels given as security cannot be foreclosed if they are not subject of the installment sale (Ridad vs.
Filipinas investment and Finance Corp. GR 39806, Jan. 28, 1983)
If the vendor assigns his to a financing company, the latter may be regarded as a collecting agency of the
vendor and cannot therefore recover any deficiency from the vendee (Zayas vs. Luneta Motors Co.)
When the vendor assigns his credit to another person, the latter is likewise bound by the same law.
Accordingly, when the assignee forecloses on the mortgage, there can be no further recovery of the
deficiency and the vendor-mortgagee is deemed to have renounced any right thereto (Borbon 11 vs.
Servicewide Specialist, Inc. 258SCRA658)
However, Article 1484(3) does NOT bar one to whom the vendor has assigned on with a recourse basis his
credit against the vendee from recovering from the vendor the assigned credit in full although the vendor
may have no right of recovery against the vendee for the deficiency (Filipinas Invest. & Finance Corp. vs
Vitug, ir. 285CRA658)
REMEDY IN CASE OF IMMOVABLES ORDINARY REMEDIES
a. In case of anticipatory breach
(1) Rescission (Article 1591)
b. Failure to pay the purchase price
(1) Rescission upon judicial or notarial demand for rescission (Article 1592)
(2) The vendee may pay, even after the expiration of the period, as long as no demand for
rescission has been made upon him
NOTE:
Article 1592 does not apply to:
1) Sale on instalment of real estate
2) Contract to sell
3) Conditional sale
4) Cases covered by RA 6552: Realty Installment buyer protection act
[ i. Spouses Alfredo v. PCI Leasing, GR No. 139233, 11 November 2005 ]
MACEDA LAW – R.A. NO. 6552
AN ACT TO PROVIDE PROTECTION TO BUYERS OF REAL ESTATE ON INSTALLMENT
PAYMENTS. (Rep. Act No. 6552)
Section 1. This Act shall be known as the "Realty Installment Buyer Act."
COVERED PROPERTIES (SEC. 2)
The Realty Installment Buyer Act (R.A. No. 6552), applies to a contract of sale of residential
realty on installments including residential condominium apartments (commercial, agricultural,
industrial), where the buyer is given protection in case of failure to pay installments.
Similar to Recto Law, the Maceda Law does not apply to sales “on credit”, only ones in
installments.
REQUISITES:
1. Transactions or contracts involving the sale OR financing of real estate on
installment payments, including residential condominium apartments; and
2. Buyer defaults in payment of succeeding installments.
RIGHTS OF THE BUYER AND GRACE PERIOD (SECS. 3-4)
Grace Period To Pay Installment In Case Of Default
A. IF AT LEAST 2 YEARS OF INSTALLMENTS HAD BEEN PAID AT THE TIME OF
DEFAULT
1. The buyer must pay, without additional interest, the unpaid installments due within the
total grace period earned by him. There shall be one (1) month grace period for every
one (1) year of installment payments made.
NOTE: This right shall be exercised by the buyer ONLY once in every 5 years of the life of the
contract AND its extensions.
2. If The Contract Is Cancelled:
He shall be entitled to the refund of the cash surrender value (CSV) of the
payments on the property equivalent to 50% of the total payments made
AND after 5 years of installments, an additional 5% every year but not to exceed
90% of the total payments made.
WHEN CANCELLATION TAKE PLACE
The actual cancellation shall take place:
After 30 days from receipt by the buyer of the notice of cancellation or the
demand for recession of the contract by notarial act; and
Upon full payment of the CSV to the buyer.
NOTE: Down payments, deposits or options on the contracts shall be included in the computation
of the total number of installments.
B. IF LESS THAN 2 YEARS OF INSTALLMENTS HAD BEEN PAID AT THE TIME OF
DEFAULT
The buyer shall be given a grace period of not less than 60 days from the date the
installment became due to pay.
WHEN CANCELLATION TAKE PLACE
If the buyer fails to pay the installment due upon the expiration of the grace period:
The seller may cancel the sale after 30 days from the receipt by the buyer of the
notice of cancellation or the demand for recession of the contract by notarial act.
NOTE: CASH SURRENDER VALUE - amount seller is required to give back in order to validly rescind.
RIGHT TO ASSIGN AND SELL THE BUYER’S INTEREST (SEC. 5)
C. ADDITIONAL RIGHTS
1. The buyer shall have the right during the grace period before cancellation of the contract:
(Sec. 5)
a. To sell his rights to another by notarial act;
b. To assign his rights to another, by notarial act; or
c. To reinstate the contract by updating the account.
ADVANCE PAYMENT (SEC. 6)
2. To pay in advance any installment or the full unpaid balance any time without interest. (Sec.6)
3. To ask for the annotation of the full payment of the purchase price in the certificate of title
covering the property.
VOID STIPULATIONS (SEC. 7)
1. Automatic cancellation or recession upon default of the buyer; VOID.
2. Stipulation as to interest or damages or penalty during the grace period; VOID.
3. Forfeiture clause (retain all payments made, will defeat CSV). VOID
EXAMPLE: MACEDA LAW
B bought from S Realty, Inc. a residential house and lot for P60,000; balance payable in 15 years
in installments of P3,000 per month. After paying the down payment and 84 monthly installments,
B defaulted in the payment of the 85th and succeeding installments.
As a consequence, S Realty, Inc. cancelled the sale.
Q: How much CSV is B entitled to receive?
A: B shall be entitled to receive a CSV of P187,200 computed as follows:
60% [P60,000+ (P3,000 x 84 months)]
Since B has paid more than 5 years of Installments, he shall be entitled to a CSV equivalent to 50% plus
5% for the 6 year and another 5% for the 7th year for a total of 60%.
[ 1. Star Asset Management Ropoas, Inc. v. Register of Deeds of Davao City, G.R. No.
233737, (03 February 2021) ]
[ 2. Pryce Properties Corp. v. Nolasco, Jr., G.R. No. 203990, (24 August 2020) ]
CONDOMINIUM LAW – P.D. 957
Section 1. Title. This Decree shall be known as THE SUBDIVISION AND CONDOMINIUM
BUYERS' PROTECTIVE DECREE.
Section 2. Definition of Terms When used in this Decree, the following terms shall, unless the
context otherwise indicates, have the following respective meanings:
(a) Person. "Person" shall mean a natural or a juridical person. A juridical person refers
to a business firm whether a corporation, partnership, cooperative or associations or a
single proprietorship.
(b) Sale or sell. "Sale" or "sell" shall include every disposition, or attempt to dispose, for
a valuable consideration, of a subdivision lot, including the building and other
improvements thereof, if any, in a subdivision project or a condominium unit in a
condominium project. "Sale" and "sell" shall also include a contract to sell, a contract of
purchase and sale, an exchange, an attempt to sell, an option of sale or purchase, a
solicitation of a sale, or an offer to sell, directly or by an agent, or by a circular, letter,
advertisement or otherwise.
A privilege given to a member of a cooperative, corporation, partnership, or any
association and/or the issuance of a certificate or receipt evidencing or giving the right of
participation in, or right to, any land in consideration of payment of the membership fee
or dues, shall be deemed a sale within the meaning of this definition.
(c) Buy and purchase. The "buy" and "purchase" shall include any contract to buy,
purchase, or otherwise acquire for a valuable consideration a subdivision lot, including
the building and other improvements, if any, in a subdivision project or a condominium
unit in a condominium project.
(d) Subdivision project. "Subdivision project" shall mean a tract or a parcel of land
registered under Act No. 496 which is partitioned primarily for residential purposes into
individual lots with or without improvements thereon, and offered to the public for sale, in
cash or in installment terms. It shall include all residential, commercial, industrial and
recreational areas as well as open spaces and other community and public areas in the
project.
(e) Subdivision lot. "Subdivision lot" shall mean any of the lots, whether residential,
commercial, industrial, or recreational, in a subdivision project.
(f) Complex subdivision plan. "Complex subdivision plan" shall mean a subdivision
plan of a registered land wherein a street, passageway or open space is delineated on
the plan.
(g) Condominium project. "Condominium project" shall mean the entire parcel of real
property divided or to be divided primarily for residential purposes into condominium
units, including all structures thereon.
(h) Condominium unit. "Condominium unit" shall mean a part of the condominium
project intended for any type of independent use or ownership, including one or more
rooms or spaces located in one or more floors (or part of parts of floors) in a building or
buildings and such accessories as may be appended thereto.
(i) Owner. "Owner" shall refer to the registered owner of the land subject of a
subdivision or a condominium project.
(j) Developer. "Developer" shall mean the person who develops or improves the
subdivision project or condominium project for and in behalf of the owner thereof.
(k) Dealer. "Dealer" shall mean any person directly engaged as principal in the business
of buying, selling or exchanging real estate whether on a full-time or part-time basis.
(l) Broker. "Broker" shall mean any person who, for commission or other compensation,
undertakes to sell or negotiate the sale of a real estate belonging to another.
(m) Salesman. "Salesman" shall refer to the person regularly employed by a broker to
perform, for and in his behalf, any or all functions of a real estate broker.
(n) Authority. "Authority" shall mean the National Housing Authority.
Section 3. National Housing Authority. The National Housing Authority shall have exclusive
jurisdiction to regulate the real estate trade and business in accordance with the provisions of
this Decree.
REQUIREMENTS FOR REGISTRATION – (SEC. 4)
Registration of Projects. The registered owner of a parcel of land who wishes to convert the
same into a subdivision project shall submit his subdivision plan to the Authority which shall act
upon and approve the same, upon a finding that the plan complies with the Subdivision
Standards' and Regulations enforceable at the time the plan is submitted.
The same procedure shall be followed in the case of a plan for a condominium project except
that, in addition, said Authority shall act upon and approve the plan with respect to the building
or buildings included in the condominium project in accordance with the National Building Code
(R.A. No. 6541).
The subdivision plan, as so approved, shall then be submitted to the Director of Lands for
approval in accordance with the procedure prescribed in Section 44 of the Land Registration Act
(Act No. 496, as amended by R.A. No. 440): Provided, that it case of complex subdivision plans,
court approval shall no longer be required.
The condominium plan as likewise so approved, shall be submitted to the Register of Deeds of
the province or city in which the property lies and the same shall be acted upon subject to the
conditions and in accordance with the procedure prescribed in Section 4 of the Condominium
Act (R.A. No. 4726).
The owner or the real estate dealer interested in the sale of lots or units, respectively, in
such subdivision project or condominium project shall register the project with the
Authority by filing therewith a sworn registration statement containing the following
information:
(a) Name of the owner;
(b) The location of the owner's principal business office, and if the owner is a non-resident
Filipino, the name and address of his agent or representative in the Philippines is
authorized to receive notice;
(c) The names and addresses of all the directors and officers of the business firm, if the
owner be a corporation, association, trust, or other entity, and of all the partners, if it be a
partnership;
(d) The general character of the business actually transacted or to be transacted by the
owner; and
(e) A statement of the capitalization of the owner, including the authorized and outstanding
amounts of its capital stock and the proportion thereof which is paid-up.
The following documents shall be attached to the registration statement:
(a) A copy of the subdivision plan or condominium plan as approved in accordance with the
first and second paragraphs of this section.
(b) A copy of any circular, prospectus, brochure, advertisement, letter, or communication to
be used for the public offering of the subdivision lots or condominium units;
(c) In case of a business firm, a balance sheet showing the amount and general character
of its assets and liabilities and a copy of its articles of incorporation or articles of
partnership or association, as the case may be, with all the amendments thereof and
existing by-laws or instruments corresponding thereto.
(d) A title to the property which is free from all liens and encumbrances: Provided, however,
that in case any subdivision lot or condominium unit is mortgaged, it is sufficient if the
instrument of mortgage contains a stipulation that the mortgagee shall release the
mortgage on any subdivision lot or condominium unit as soon as the full purchase price
for the same is paid by the buyer.
The person filing the registration statement shall pay the registration fees prescribed therefor by
the Authority.
Thereupon, the Authority shall immediately cause to be published a notice of the filing of the
registration statement at the expense of the applicant-owner or dealer, in two newspapers
general circulation, one published in English and another in Pilipino, once a week for two
consecutive weeks, reciting that a registration statement for the sale of subdivision lots or
condominium units has been filed in the National Housing Authority; that the aforesaid
registration statement, as well as the papers attached thereto, are open to inspection during
business hours by interested parties, under such regulations as the Authority may impose; and
that copies thereof shall be furnished to any party upon payment of the proper fees.
The subdivision project of the condominium project shall be deemed registered upon completion
of the above publication requirement. The fact of such registration shall be evidenced by a
registration certificate to be issued to the applicant-owner or dealer.
LICENSE TO SELL AND PERFORMANCE BOND – (SEC. 5-6)
SECTION 5. LICENSE TO SELL. Such owner or dealer to whom has been issued a registration
certificate shall not, however, be authorized to sell any subdivision lot or condominium unit in
the registered project unless he shall have first obtained a license to sell the project within two
weeks from the registration of such project.
The Authority, upon proper application therefor, shall issue to such owner or dealer of a
registered project a license to sell the project if, after an examination of the registration
statement filed by said owner or dealer and all the pertinent documents attached thereto, he is
convinced that the owner or dealer is of good repute, that his business is financially stable, and
that the proposed sale of the subdivision lots or condominium units to the public would not be
fraudulent.
(License to sell. However, if an owner or dealer receives a registration certificate, he or she is
not permitted to sell any subdivision lots or condominium units in the registered project unless
he or she has first secured a license to sell the project within two weeks of the registration of
such project.)
SECTION 6. PERFORMANCE BOND. No license to sell subdivision lots or condominium units
shall be issued by the Authority under Section 5 of this Decree unless the owner or dealer shall
have filed an adequate performance bond approved by said Authority to guarantee the
construction and maintenance of the roads, gutters, drainage, sewerage, water system, lighting
systems, and full development of the subdivision project or the condominium project and the
compliance by the owner or dealer with the applicable laws and rules and regulations.
The performance bond shall be executed in favor of the Republic of the Philippines and shall
authorize the Authority to use the proceeds thereof for the purposes of its undertaking in case of
forfeiture as provided in this Decree.
(If the Authority examines, after reviewing the registration statement provided by the owner or
dealer and all relevant papers attached thereto,
a. that the owner or dealer is of good standing,
b. that his business is financially sound, and
c. that the intended sale of the subdivision lots or condominium units to the public
would not be in violation of any laws or regulations, it will grant the owner or
dealer a license to sell the project.
The performance bond shall be executed in favor of the Republic of the Philippines and shall
authorize the Authority to use the proceeds thereof for the purposes of its undertaking in case of
forfeiture as provided in this Decree.)
EXEMPT TRANSACTIONS – (SEC. 7)
SECTION 7. EXEMPT TRANSACTIONS. A license to sell and performance bond shall not be
required in any of the following transactions:
(a) Sale of a subdivision lot resulting from the partition of land among co-owners and co-
heirs.
(b) Sale or transfer of a subdivision lot by the original purchaser thereof and any subsequent
sale of the same lot.
(c) Sale of a subdivision lot or a condominium unit by or for the account of a mortgagee in
the ordinary course of business when necessary to liquidate a bona fide debt.
SUSPENSION – (SEC. 8)
The Authority may, in its discretion, immediately suspend (motu proporio) the owner's or
dealer's license to sell upon receiving a confirmed complaint from a buyer of a subdivision lot or
a condominium unit from any interested party, pending investigation and hearing of the case as
provided in Section 13 below:
a. Notice. No such hearing shall proceed unless the respondent is furnished with a copy of the
complaint against him or is notified in writing of the purpose of such hearing.
b. Venue. The hearing may be held before the officer/s designated by the Authority on the date
and place specified in the notice.
c. Nature of proceeding. The proceedings shall be non-litigious and summary in nature without
regard to legal technicalities obtaining in courts of law. The Rules of court shall not apply in said
hearing except by analogy or in a suppletory character and whenever practicable and
convenient.
d. Power incidental to the hearing. For the purpose of the hearing or other proceeding under
this Decree, the officer/s designated to hear the complaint shall have the power to administer
oaths, subpoena witnesses, conduct ocular inspections, take depositions, and require the
production of any book, paper, correspondence, memorandum, or other record which are
deemed relevant or material to the inquiry. (Sec. 13).
NOTE: The Authority may motu proprio suspend the license to sell if:
a. in its opinion, any information in the registration statement filed by the owner or dealer is or has
become misleading;
b. Incorrect, inadequate or Incomplete or the sale or offering for a sale of the subdivision or
condominium project may work or tend to work a fraud upon prospective buyers.
The suspension order may be lifted if:
a. after notice and hearing The Authority is convinced that the registration statement is a. accurate
or
b. that any deficiency therein has been corrected or supplemented or
c. that the sale to the public of the subdivision or condominium project will neither be fraudulent not
result in fraud.
It shall also be lifted upon dismissal of the complaint for lack of legal basis.
Until the final entry of an order of suspension, the suspension of the right to sell the project,
though binding upon all persons notified thereof, shall be deemed confidential unless it shall
appear that the order of suspension has in the meantime been violated.
REVOCATION OF LICENSE – (SEC. 9)
SECTION 9. REVOCATION OF REGISTRATION CERTIFICATE AND LICENSE TO
SELL. The Authority may, motu proprio or upon verified complaint filed by a buyer of a
subdivision lot or condominium unit, revoke the registration of any subdivision project or
condominium project and the license to sell any subdivision lot or condominium unit in said
project by issuing an order to this effect, with his findings in respect thereto, if upon examination
into the affairs of the owner or dealer during a hearing as provided for in Section 14 hereof, if
shall appear there is satisfactory evidence that the said owner or dealer:
(a) Is insolvent; or
(b) has violated any of the provisions of this Decree or any applicable rule or
regulation of the Authority, or any undertaking of his/its performance bond; or
(c) Has been or is engaged or is about to engage in fraudulent transactions; or
(d) Has made any misrepresentation in any prospectus, brochure, circular or other
literature about the subdivision project or condominium project that has been
distributed to prospective buyers; or
(e) Is of bad business repute; or
(f) Does not conduct his business in accordance with law or sound business
principles.
Where the owner or dealer is a partnership or corporation or an unincorporated association, it
shall be sufficient cause for cancellation of its registration certificate and its license to sell, if any
member of such partnership or any officer or director of such corporation or association has
been guilty of any act or omission which would be cause for refusing or revoking the registration
of an individual dealer, broker or salesman as provided in Section 11 hereof.
REGISTRATION OF BROKERS, DEALERS, AND SALESMAN – (SEC. 11)
GR: No real estate dealer, broker or salesman shall engage in the business of selling
subdivision lots or condominium units.
EXP: unless he has registered himself with the Authority in accordance with the provisions of
this section.
RULE: If the Authority shall find that the applicant is of good repute and has complied with the
applicable rules of the Authority, including the payment of the prescribed fee.
EFFECT: he shall register such applicant as a dealer, broker or salesman upon filing a bond, or
other security in lieu thereof, in such sum as may be fixed by the Authority conditioned upon his
faithful compliance with the provisions of this Decree: Provided, that the registration of a
salesman shall cease upon the termination of his employment with a dealer or broker.
NOTE: Every registration under this section shall expire on the thirty-first (31) day of December of each
year.
GR: Renewal of registration for the succeeding year shall be granted upon written application therefor
made not less than thirty (30) nor more than sixty (60) days before the first day of the ensuing year and
upon payment of the prescribed fee, without the necessity of filing further statements or information.
EXP: unless specifically required by the Authority.
All applications filed beyond said period shall be treated as original applications.
The names and addresses of all persons registered as dealers, brokers, or salesmen shall be
recorded in a Register of Brokers, Dealers and Salesmen kept in the Authority which shall be open
to public inspection.
ALTERATION OF PLANS – (SEC. 22)
No owner or developer shall change or alter the roads, open spaces, infrastructures, facilities for
public use and/or other form of subdivision development as contained in the approved
subdivision plan and/or represented in its advertisements, without the permission of the
Authority and the written conformity or consent of the duly organized homeowners association,
or in the absence of the latter, by the majority of the lot buyers in the subdivision.
NON-FORFEITURE OF PAYMENTS – (SEC. 23)
No installment payment made by a buyer in a subdivision or condominium project for the lot or
unit he contracted to buy shall be forfeited in favor of the owner or developer when the buyer,
(1) After due notice to the owner or developer, desists from further payment;
(2) Due to failure of the owner or developer to develop the subdivision or condominium
project according to the approved plans and within the time limit for complying the same.
(ayaw magbayad ni buyer ng installment dahil may failure na sumunod yung developer
sa plans tapos nag-notice sya sa owner/developer, valid and pag-desist nya. And mga
binayad nya will not be forfeited in favor of the owner or developer).
Such buyer may at his option be reimbursed the total amount paid including amortization
interests but excluding delinquency interests, with interest thereon at the legal rate.
FAILURE TO PAY INSTALLMENTS – (SEC. 24)
The rights of the buyer in the event of his failure to pay the installments due for reasons other
than the failure of the owner or developer to develop the project shall be governed by the
Maceda Law (RA 6552) (residential realty only)
ISSUANCE OF THE TITLE – (SEC. 25)
The owner or developer shall deliver the title of the lot or unit to the buyer upon full payment of
the lot or unit.
No fee, except those required for the registration of the deed of sale in the Registry of Deeds,
shall be collected for the issuance of such title.
In the event a mortgage over the lot or unit is outstanding at the time of the issuance of the
title to the buyer, the owner or developer shall redeem the mortgage or the corresponding
portion thereof within six months from such issuance in order that the title over any fully paid lot
or unit may be secured and delivered to the buyer in accordance herewith.
