Amending Section Sixty Two Of Republic Act Numbered Three Thousand Eight Hundred Forty-Four, As Amended, Otherwise Known As The Code Of Agrarian Reforms Of The Philippines

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PRESIDENTIAL DECREE No. 1817

AMENDING SECTION SIXTY TWO OF REPUBLIC ACT NUMBERED THREE THOUSAND EIGHT HUNDRED FORTY-FOUR, AS AMENDED, OTHERWISE KNOWN AS THE CODE OF AGRARIAN REFORMS OF THE PHILIPPINES

WHEREAS, the farmer-beneficiary who has fully paid the cost of his farm and/or homelots to the Land Bank of the Philippines under Section Sixty-two of Republic Act Numbered Three Thousand Eight Hundred and Forty-Four, is legally enjoined from using said property as collateral for loans to be obtained from public or private lending institutions:

WHEREAS, under the existing provision, a farmer-beneficiary who is still amortizing the cost of his land is better situated than a beneficiary who has already paid in full the cost of the land for being given an opportunity to secure loans and credit assistance thru the use of the Certificate of Land Transfer (CLT) as collateral;

WHEREAS, the operative effects of such provision, besides being iniquitous on the part of the farmer-beneficiary who has fully paid for his land, could...

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Summary of Presidential Decree No. 1817

Amending Section 62 of Republic Act No. 3844 (Code of Agrarian Reforms of the Philippines):

- Limitation of Land Rights:
• Landholding acquired under this Code shall not be sold or transferred except in favor of the Government, valued at its acquisition cost plus cost of improvements. (Section 1)
• Landholding may be mortgaged or encumbered in favor of any financing or banking institution up to the original cost of acquisition, guaranteed by the Samahang Nayon or duly recognized farmers cooperative where the farmer is a full-pledged member. (Section 1)
• In case of default, the loan becomes immediately due and demandable, and the mortgagor is given a grace period of one year within which to settle the obligation. (Section 1)
• If not paid within the one-year grace period, the landholding shall be disposed of only in favor of the Government, which shall endeavor to substitute the defaulting farmer-beneficiary preferably with a new one who does not own any land, certified by the Ministry of Agrarian Reform, and who shall be subrogated to the rights and assume the obligations of the replaced farmer-beneficiary, subject to the preferential right of first refusal of the other heirs of the latter. (Section 1)
• A purchaser who acquired his landholding under a contract to sell from Land Bank, or has been issued an Order of Award, may also secure a loan from any financing or banking institution in an amount not exceeding his equity on said landholding. (Section 1)
• Except in hereditary succession by one heir, landholding acquired under this Code shall not be sold or transferred. (Section 1)