REPUBLIC ACT 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."
Section 2. It is hereby declared a public policy to protect buyers of real estate on installment payments against onerous and oppressive conditions.
Section 3. In all transactions or contracts involving the sale or financing of real estate on installment payments, including residential condominium apartments but excluding industrial lots, commercial buildings and sales to tenants under Republic Act Numbered Thirty-eight hundred forty-four, as amended by Republic Act Numbered Sixty-three hundred eighty-nine, where the buyer has paid at least two years of installments, the buyer is entitled to the following rights in case he defaults in the payment of succeeding installments:
(a) To pay, without additional interest, the unpaid installments due within the total grace period earned by him which is hereby fixed at the rate of one month grace period for every one year of installment payments made: Provided,...
Details
Amends
n/a
Amended by
n/a
Republic Acts
AN ACT TO PROVIDE PROTECTION TO BUYERS OF REAL ESTATE ON INSTALLMENT PAYMENTS
Republic Act No. 6552
Summary of Republic Act No. 6552 (Realty Installment Buyer Act)
Title: An Act to Provide Protection to Buyers of Real Estate on Installment Payments
- Declares a public policy to protect buyers of real estate on installment payments against onerous and oppressive conditions. (Section 2)
- Covers transactions or contracts involving the sale or financing of real estate on installment payments, including residential condominium apartments. (Section 3)
- Excludes industrial lots, commercial buildings, and sales to tenants under Republic Act No. 3844 (as amended by Republic Act No. 6389). (Section 3)
- For buyers who have paid at least two years of installments and default on succeeding installments, the following rights are granted:
- To pay, without additional interest, the unpaid installments due within the total grace period earned, which is one month for every one year of installment payments made. This right can be exercised only once in every five years of the contract's life and its extensions, if any. (Section 3(a))
- If the contract is canceled, the seller shall refund the cash surrender value of the payments on the property, equivalent to 50% of the total payments made, and after five years, an additional 5% every year, but not exceeding 90% of the total payments made. Actual cancellation shall take place after 30 days from receipt of the notice of cancellation or demand for rescission by a notarial act and upon full payment of the cash surrender value to the buyer. (Section 3(b))
- Down payments, deposits, or options on the contract shall be included in the computation of the total number of installment payments made. (Section 3)
- For buyers who have paid less than two years of installments and default, the seller shall give a grace period of not less than 60 days from the due date. If the buyer fails to pay within the grace period, the seller may cancel the contract after 30 days from receipt of the notice of cancellation or demand for rescission by a notarial act. (Section 4)
- The buyer has the right to sell or assign their rights to another person or to reinstate the contract by updating the account during the grace period and before actual cancellation. The deed of sale or assignment shall be done by notarial act. (Section 5)
- The buyer has the right to pay in advance any installment or the full unpaid balance of the purchase price any time without interest and to have such full payment annotated in the certificate of title covering the property. (Section 6)
- Any stipulation in any contract contrary to the provisions of Sections 3, 4, 5, and 6 shall be null and void. (Section 7)
- If any provision of this Act is held invalid or unconstitutional, no other provision shall be affected thereby. (Section 8)
- This Act shall take effect upon its approval. (Section 9)
Title: An Act to Provide Protection to Buyers of Real Estate on Installment Payments
- Declares a public policy to protect buyers of real estate on installment payments against onerous and oppressive conditions. (Section 2)
- Covers transactions or contracts involving the sale or financing of real estate on installment payments, including residential condominium apartments. (Section 3)
- Excludes industrial lots, commercial buildings, and sales to tenants under Republic Act No. 3844 (as amended by Republic Act No. 6389). (Section 3)
- For buyers who have paid at least two years of installments and default on succeeding installments, the following rights are granted:
- To pay, without additional interest, the unpaid installments due within the total grace period earned, which is one month for every one year of installment payments made. This right can be exercised only once in every five years of the contract's life and its extensions, if any. (Section 3(a))
- If the contract is canceled, the seller shall refund the cash surrender value of the payments on the property, equivalent to 50% of the total payments made, and after five years, an additional 5% every year, but not exceeding 90% of the total payments made. Actual cancellation shall take place after 30 days from receipt of the notice of cancellation or demand for rescission by a notarial act and upon full payment of the cash surrender value to the buyer. (Section 3(b))
- Down payments, deposits, or options on the contract shall be included in the computation of the total number of installment payments made. (Section 3)
- For buyers who have paid less than two years of installments and default, the seller shall give a grace period of not less than 60 days from the due date. If the buyer fails to pay within the grace period, the seller may cancel the contract after 30 days from receipt of the notice of cancellation or demand for rescission by a notarial act. (Section 4)
- The buyer has the right to sell or assign their rights to another person or to reinstate the contract by updating the account during the grace period and before actual cancellation. The deed of sale or assignment shall be done by notarial act. (Section 5)
- The buyer has the right to pay in advance any installment or the full unpaid balance of the purchase price any time without interest and to have such full payment annotated in the certificate of title covering the property. (Section 6)
- Any stipulation in any contract contrary to the provisions of Sections 3, 4, 5, and 6 shall be null and void. (Section 7)
- If any provision of this Act is held invalid or unconstitutional, no other provision shall be affected thereby. (Section 8)
- This Act shall take effect upon its approval. (Section 9)