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FOURTEENTH CONGRESS OF THE REPUBLIC 
First Regular Session 
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OF THE PHILPPINES 
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S E N A T E  
S. B. No. 
18 
Introduced by Senator Biazon 
EXPLANATORY NOTE 
Numerous cases of misrepresentation of subdivision owners, developers and realtors have 
been made against unsuspecting buyers who have been continuously victimized. Among the 
cases of misrepresentations are the following: 
( I )  
(2) 
When parcels of land are being sold even if there is still no individual title available; 
When the subdivision lot is already being sold and it is still not ready for occupancy due 
to lack of provisions for water, light and telephone facilities, the roads are not yet 
cemented/asphalted or there are no proper drainages in place; 
When a real estate mortgage has been constituted over a piece of property absent any 
knowledge of the buyer who pays the entire amount but is not issued the title over the 
said property; 
Apart from these misrepresentations, the buyers on installment have also to deal with 
contracts that create the undue advantages in favor of the vendors. Examples of these unfair 
stipulations are the following: 
(3) 
(1) 
(2) 
(3) 
That the liability for real estate taxes are immediately transferred to the buyer upon the 
execution of the contract; 
That the contract price and interest rates shall be adjusted in any event of devaluation of 
Philippine currency; and 
That the seller may refuse to allow the buyer to take immediate possession of the 
property purchased unless all installments are paid. 
Although R.A. No. 6552 otherwise known as the "Realty Installment Buyer Protection 
Act" is in effect, such law does not explicitly address many of the problems currently being 
encountered by the unsuspecting buyers. This bill seeks to plug these loopholes. Hence, the 
immediate enactment of this measure is earnestly requested. 
RODOLFO 
BIAZON 
Senator 


S E N A T E  
S.B.No. 
185 
Introduced by Senator Biazon 
AN ACT 
TO PROVIDE ADDITIONAL PROTECTION TO BUYERS OF REAL ESTATE ON 
INSTALLMENT PAYMENTS BY REQUIRING SUBDIVISION OR REAL ESTATE 
OWNERS TO HAVE AN INDIVIDUAL TITLE ON EVERY LOT AVAILABLE FIRST 
BEFORE OFFERING THE SAME FOR SALE, PROHIBITING ANY MORTGAGE, 
LIEN OR ENCUMBRANCE ON THE SAME, MAKING THE ANOTATION ON THE 
TITLE OF THE CONTRACT TO SELL OR SALE MANDATORY, MAKING IT 
COMPULSORY FOR THE EXECUTION OF A DEED OF ABSOLUTE SALE AND THE 
DELIVERY OF THE TITLE TO THE BUYER UPON COMPLETION OF 
INSTALLMENT PAYMENTS, AND PROVIDING OTHER PROTECTIVE MEASURES, 
INCLUDING THE IMPOSITION OF PENALTY FOR VIOLATION THEREOF 
Be it enacted by the Senute and House of Representatives ofthe Philippines in Congress 
ussern bled: 
SECTION 1. No piece of real estate as contemplated in Republic Act No. 6552, 
otherwise known as “Realty Installnient Buyer Protection Act” shall be offered for sale on 
installment payment unless it is covered by a separate and individual Torrens Certificate of Title 
to constitute a real estate mortgage or any lien or encumbrances. 
Sec. 2. It shall be unIawfuI for any subdivision or individual owner of any piece of real 
estate covered by any separate or individual Torrens Certificate of Title to constitute a real estate 
mortgage or any lien or encumbrance over the said title whenever the same has already been sold 
to any third person in installment payments. 
Sec. 3. Once the buyer and seller shall have signed the contract to sell or contract of sale 
over any piece of real estate on installment payments covered by a separate or individual Torrens 
Certificate of Title, the said contract shall be immediately annotated by the seller at the back of 
the said title on file with the Register of Deeds of the provinces or city where the property is 
located: Provided, That if the seller should neglect or refuse to do his obligation herein stated, 
the buyer shall have the absolute right to have his contract annotated upon mere presentation of 
his contract to sell or contract of sale. 
Sec. 4. Payment of taxes shall remain to be the obligation of the seller of real estate on 
installment payments notwithstanding the execution of the contract to sell or contract of sale, but 
such obligation shall be transferred to the buyer from the moment the latter shall have started 
taking physical possession of the real estate purchased on installment payments, or the title is 
transferred to the buyer. 
Sec. 5. Upon the completion of the installment payments on any piece of real estate, the 
seller, without the necessity of demand shall within thirty (30) days therefrom, shall execute in 
favor of the buyer, his heirs, assigns and successors-in-interest, an absolute deed of sale and 
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deliver the same to the latter together with the owner’s duplicate certificate of title over the real 
estate purchased. 
Sec. 6. No subdivision lot shall be offered €or sale to the public unless: (1) all the water, 
electrical and telephone systems with provisions for the installation of individual water and 
electric meters and telephone cable lines have been installed; (2) a good drainage system that is 
duly approved by the municipal or city engineer as the case may be, and especially the roads 
within the subdivision, have either been fully cemented or asphalted with the measurement of at 
least six inches (6”) thick; and (3) said roads have been donated to the municipality or city where 
the subdivision lots are located which shall be obliged to immediately accept the said donation 
and from then to assume the responsibility of maintaining and repairing the same. 
Sec. 7. Any buyer of real estate on installment payments as contemplated in this Act 
shall have the right to take possession of the property purchased upon the execution of the 
appropriate contract to sell or contract of sale and the application for a building permit solely 
signed by the buyer shall suffice for the issuance of a building permit to construct any 
improvement on the property purchased. 
Sec. 8. The contract price and interest rates stipulated in the contract to sell or contract of 
sale of real estate on installment payment shall remain constant and unaffected notwithstanding 
any artificial depreciation or devaluation o f  the Philippine currency. 
Sec. 9. Upon the effectivity of this Act, the Housing Land Use Regulatory Board 
(MLURB) shall promulgate such rules and regulations as may be necessary to implement and 
enforce the provisions of this Act. 
Sec. 10. Any stipulation in any contract hereafter entered into contrary to the provisions 
of this Act shall be null and void. 
Sec. 11. Any act or omission in violation of this Act or any of the pertinent rules and 
regulations of the IlLURB shall be punishable by a fine of Ten thousand pesos (Pl0,OOO.OO) and 
by imprisonment of one (1) year. 
Sec. 12. All laws, executive orders, decrees, rules or regulations inconsistent with the 
provisions of this Act are hereby repealed, amended or modified accordingly. 
Sec. 13. This Act shall take effect upon its approval. 
Approved, 
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