Here are the tips a buyer must remember before buying any property in the Philippines, specially if you are buying a single property from an individual:
1. Make sure the Title is authentic. Ask for a plain copy of the owner's title. Then go to the Register of Deeds (ROD) and ask for a “Certified True Copy” of the master title held by this office. If the two copies are identical... the title is authentic. The ROD is usually located at the city or municipal hall where the property is located.
2. Beware if the master copy on file with the ROD has any mortgages, lease contracts, power of attorney, claims of third parties, government liens, road right of way assessments, and etc. noted on the back 3 pages. Although the title may still be registered in the name of a person, ownership will be affected by what is noted on the back pages. Do this yourself or through a trusted party, never from the seller or his middleman. Titles have four pages: Cover and pages A, B, and C. Make sure you see all four pages.
3. Make sure that the land described on the title is really the land that you are buying. You can validate this at the Municipal Tax Assessor's office by asking to see the land map where the property is located. While you are at this office, get a certified true copy of all the tax declarations to the property. The land will have a separate tax declaration. So will each building on the property worth more than 25,000 pesos. Also confirm that the yearly real estate taxes are paid.
4. Make sure that the sellers are the real owners. If you are buying from an individual property owner, ask for identification papers like passport or driver’s license, it is also a good idea to talk to the neighbors to confirm the identity of the sellers (you might as well ask some history of the property).
5. Avoid tax-declared property... deal only with titled property. You must be an expert at buying and selling property in the Philippines before trying to buy property with only a tax declaration. There are many properties in the Philippines that are not titled, or registered under the Torrens system. If you buy an untitled property (usually evidenced by only a Tax Declaration), you would not enjoy the benefits of the Torrens system, and you will be forced to investigate for yourself the “chain of ownership” from the present owner up to the first, which usually dates back to the 1920′s. With titled property, you can rely on the fact that the owner of the property is that which is stated in the title.
6. Stick to those properties registered in the names of actual sellers themselves. Most properties in the Philippines are titled in the names of the grand parents or even great grandparents of the owners. thus, there is still the need to execute an extra-judicial settlement, which has a “grace period” of two years within which an excluded heir can question the settlement and the sale. This type of litigation is fairly common and is the usual source of problems. Thus, avoid properties not titled in the names of the actual seller. You need EXPERT advice to buy a property from the heirs of a deceased.
7. Avoid SPAs (Special Power of Attorney) – deal with the actual sellers themselves. Another of the common sources of property litigation in the Philippines are those involving special power of attorneys. This is an instrument that empowers a party to deal with the property of another, usually for the purpose of selling the property. Oftentimes, unscrupulous individuals procure a special power of attorney surreptitiously from the unwitting owner who is led to believe that the document being signed is something else. Believe it or not, most of the property owners in the Philippines have finished only primary schooling and cannot read English documents. If you must deal with property being sold through an SPA make sure you seek the advice of an expert.
8. If there are any questions that the property might not be located exactly where it is stated on the title, have the boundaries identified by a licensed surveyor. Ask the seller to allow you to conduct a relocation survey. Although you might be required to shell out additional expense for the survey, then you can actually be assured of the metes and bounds of the property and that the property you are buying is actually that stated on the title. When doing the relocation survey, make sure the adjacent owners are summoned so they can agree to the boundary line.
9. Always see to it that you have a road right of way. Just merely looking at the property and seeing a road is not enough. Check the title and see whether or not it is actually bounded by a road lot, road, or street. The surveyor can point this out to you. Most foreigners like the countryside and coasts, where agricultural lands are located. Thus, most agricultural lands when subdivided into smaller parts do not provide for a road in the subdivision plan. Be sure therefore that you have access to the land otherwise, you might be required to purchase a right of way, oftentimes at exorbitant prices such that you are forced to enter into litigation to have the court fix a reasonable price.
10. Never forget to have your deed of sale, contract of sale or other document over the land annotated on the copy of the title on file with the register of deeds.
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