how to transfer real estate property in the Philippines
Registration of transfer of real property in the Philippines is no longer much of a hassle. Especially now, most of the government offices are equip with hi-tech facilities. You can do this on your own. We’ll guide you on how you can process the registration of the transfer of a property under your name:
I. First Things First – Due Diligence
This is the first step in the procedure below. But, we want to give emphasis that this is an important procedure in order for you not to be defraud. So, check first if the property you’re buying is registered in the Registry of Deeds (RD).
A. Facts to Verify with RD
a) Is the Transfer Certificate of Title (TCT) No. correct?
b) Is the TCT under the name of the Seller?
c) Is there any encumbrances (e.g., subject in mortgage or a pending case) on the TCT?
d) Are the other details (e.g. description of the land) of TCT correct?
B. Check if real property tax has been paid with Land Tax Division of the City Treasurer’s Office (CTO)
II. Documents Needed:
A. To be provided by the Seller
a. Original Transfer Certificate of Title
b. Tax clearance certificate of real property taxes (both for land and improvement)
c. Official receipt evidencing payment by seller of realty taxes
d. Photocopy of official receipt for payment of real property tax
e. Latest tax declaration
B. To be Filled up
a. Capital Gains Tax Return (BIR FORM 1706)
b. Documentary Stamp Tax Return (BIR Form 2000)
C. To be Prepared
a. Deed of Absolute Sale
b. Request Letter to BIR
Note: Keep all documents in tact in one folder/envelope so you can easily bring them around. The procedure below is going to be simultaneous. You will be needing to present also official receipts that you’ve paid the CGT, DTS, transfer tax and so on.
1) Secure from the Register of Deeds (RD) certified true copy of the title
This is our first note. The RD wouldn’t probably just let you review the Original TCT as we have advised you above. It is best that the first thing you should really do is to request for its certified true copy.
2) Prepare and execute conveyance instrument before a Notary Public
You may request or download from the internet a simple format of deed of sale. Make sure that all details in the deed of sale bears the same details specified in the TCT. The seller and the buyer shall then sign the instrument before a Notary Public.
3) Request for issuance of tax clearance certificate from the City Treasurer’s Office (CTO)
The Seller should be the one to request for the tax clearance certificate of real property tax. A second tax clearance specifically for improvement/building will be issued.
4) Request for certified true copy of latest tax declaration
The Seller should also be the one to request the certified true copy of the latest tax declaration from the City Assessor’s Office (CAO). If the property is a vacant lot only, the seller may request for certificate of "no improvement."
5) Pay the capital gains tax (CGT) and documentary stamp tax (DST) at any Authorized Agent Bank (AAB)
You may request the BIR for the computation of the CGT and DST. You will fill up the forms: a) Capital Gains Tax Return (BIR FORM 1706); and b) Documentary Stamp Tax Return (BIR Form 2000).
6) Secure Certificate Authorizing Registration (CAR) from the Bureau of Internal Revenue (BIR)
After payment of CGT and DST at AAB, BIR will review all the documents submitted. This will take days. Upon the issuance of the CAR, make sure BIR returns to you the Original TCT.
7) Pay the transfer tax at the Real Estate Tax Division of the CTO
Transfer Tax may 0.75% of property price.
8) Secure the New Transfer Certificate of Title from RD
This is where you will surrender the old Original TCT. The RD will also require you to pay for issuance of the Transfer Certificate of Title. Upon receiving the new TCT, double check if the details entered in the new TCT are correct.
9) Request for new tax declaration from CAO
The new tax declaration for the real property should now be under you name. Don't forget that your land and improvement should each have separate tax declaration.
Check your deadline. Payment of CGT should be paid within 30 days from the date of notarization of the deed of sale. DST should be paid within 5 days after the end of the month of the date of notarization. Transfer tax will be paid within 60 days from the date of notarization.
Finally, keep your head cool. Everyone wants to get everything done. Let’s give the government employees a break. Or at least understand them that dealing with different people can be very overwhelming. Ask them nicely. Ask when you can secure your request. Maybe, you can also ask for their office number so you can just call to follow-up.
Baguio's real estate as hot investment
Living in a commonly hot and humid environment such as in the tropic country as in the Philippines, a high place like the city of Baguio is a welcoming terrain in beating the normal heat that affects the people of the country for its relatively cooler temperature year-round and thus being labelled as its “summer capital.”
Partly for this reason, Baguio City is now more proliferated than ever and is also the reason why it became a hotspot in the real estate business despite its inherently mountainous terrain.
If you are a person of good means and is on the lookout for a new property to buy—either for business or as a place to call your own—the city of Baguio poses as one of the ideal places for property owning due to the following reasons:
Having a property in Baguio City is more than just for the rich and the affluent nowadays. Even seemingly less rich can now own their property in Baguio City with a little bit of knowledge in real estate business and even a touch of ingenuity.
However, to make things less complicated for you as a potential real estate owner, it pays to seek professional aid from a real estate agent in Baguio City before making a purchase. A real estate agent in Baguio City is likely to smoothen out to you what would otherwise be a rather rough business in real estate.
While you are at it, why not opt for a licensed real estate broker in Baguio City? A licensed real estate broker in Baguio City should know of the laws and regulations of the land which an unlicensed broker may not.
things to consider in buying real estate properties in Baguio city
Having a home is every one’s dream especially if you have a family to take care of. This goal takes a lot of planning, financial savings and well-executed decisions as this will be your lifetime investment. If all works out, think of having that dream house up north where the climate is cooler and the properties have lower costs than in the city.
If you’re getting a property in Baguio City then you need a legitimate real estate broker in Baguio City who can help you with the needed documents and requirements. It may take some time to complete them but with the aid of your chosen real estate agent in Baguio City then there won’t be any problem.
If you are buying a property, whether a house and lot in Baguio City or even a condominium in Baguio City, you will face some challenges that will come along the way. Let us enumerate some of them so you will be aware and be ready to deal with them.