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Questions and Answers

What is the primary purpose of PD 957?

  • To promote unregulated real estate practices
  • To increase taxes on real estate transactions
  • To provide subsidies for real estate developers
  • To protect buyers of subdivision lots and condominiums (correct)

Which government agency is designated to oversee the regulation of real estate subdivisions and condominiums?

  • Land Registration Authority
  • National Housing Authority (correct)
  • Department of Housing Affairs
  • Real Estate Board

What must developers provide according to PD 1216?

  • Free home improvement services
  • Adequate roads, alleys, and sidewalks (correct)
  • Land titles for all properties
  • Aesthetic landscaping designs

What is a common violation that PD 957 seeks to address?

<p>Failure to provide adequate infrastructure (D)</p> Signup and view all the answers

In the context of PD 957, a 'buyer' is best defined as:

<p>A person in a legally binding agreement to purchase property (B)</p> Signup and view all the answers

What types of penalties does PD 957 impose?

<p>Fines and legal action against fraudulent practices (A)</p> Signup and view all the answers

What aspect of subdivision projects does PD 957 require registration for?

<p>All subdivision and condominium projects (A)</p> Signup and view all the answers

Which of the following is NOT a defined term under PD 957?

<p>Market value (B)</p> Signup and view all the answers

What must an owner or developer do if a mortgage is outstanding at the time of title issuance?

<p>Redeem the mortgage within six months (B)</p> Signup and view all the answers

Who is responsible for real estate tax and assessment until the title has passed to the buyer?

<p>The owner or developer (C)</p> Signup and view all the answers

When is a buyer liable for real estate taxes after taking possession of a property?

<p>Effective the year following possession and occupancy (D)</p> Signup and view all the answers

What restrictions are placed on an owner or developer regarding fees for community benefits?

<p>Fees must be approved by a majority of the homeowners association (B)</p> Signup and view all the answers

What right must an owner or developer secure if there is no existing public road access?

<p>A right of way to a public road (D)</p> Signup and view all the answers

What is the purpose of organizing a homeowners association as outlined for developers?

<p>To promote and protect mutual interests of residents (A)</p> Signup and view all the answers

What must developers do regarding access to public offices within a subdivision?

<p>Allow free access to all government offices (B)</p> Signup and view all the answers

What should a homeowner association's fee structures aim to finance according to regulations?

<p>Services for common comfort and security (B)</p> Signup and view all the answers

What must an owner or developer obtain before altering any public infrastructure or facilities in a subdivision?

<p>Permission from the Authority and written consent from the homeowners association (A)</p> Signup and view all the answers

If a buyer chooses to stop payments due to the developer's failure to develop the project as promised, what is their right regarding payments?

<p>They can be reimbursed the total amount paid, excluding certain interests (C)</p> Signup and view all the answers

What governs the rights of a buyer who fails to pay installments for reasons other than the developer's failure?

<p>The provisions specified in Republic Act No. 6552 (D)</p> Signup and view all the answers

When must a developer deliver the title of a lot or unit to the buyer?

<p>Upon full payment for the lot or unit (B)</p> Signup and view all the answers

What type of interests are excluded from the total reimbursement amount a buyer may claim when they stop payments?

<p>Delinquency interests (B)</p> Signup and view all the answers

What happens to a buyer’s rights under Republic Act No. 6552 if their transaction was initiated before the law's effectivity?

<p>They can claim a refund for installments paid post-effectivity of the law (B)</p> Signup and view all the answers

Which of the following is NOT a requirement for an owner or developer to change subdivision plans?

<p>Approval from the previous owners of the lots (D)</p> Signup and view all the answers

What is the primary purpose of Section 24 regarding failure to pay installments?

<p>To clarify buyer's rights based on the governing law (B)</p> Signup and view all the answers

Flashcards

PD 957

The Subdivision and Condominium Buyers' Protective Decree, a presidential decree regulating the sale of subdivision lots and condominiums, including penalties for violations.

Subdivision

A planned area of land divided into individual lots for residential, commercial, or mixed use development; often includes roads, utilities, and recreational areas.

Condominium

A housing project where individual units are owned, while common areas are shared.

Developer

The individual or company responsible for creating a subdivision or condominium project, including planning, construction, and sale of the units.

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National Housing Authority (NHA)

The government agency with the exclusive authority to regulate real estate trade in compliance with the decree.

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Registration of Projects

The process where subdivision plans are submitted to the NHA before being developed, enabling them to make sure standards are met

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Subdivision Plan

Detailed map showing the layout of a subdivision, including streets, lots, and other important features.

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PD 1216

An amendment to previous decrees requiring subdivision owners to provide necessary infrastructure like roads, alleys, and sidewalks.

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Outstanding Mortgage Redemption

The owner/developer must pay off any outstanding mortgages on a lot/unit within 6 months of title issuance to the buyer.

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Realty Tax Liability (Pre-Possession)

Owner/developer pays real estate taxes until title transfer to buyer.

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Realty Tax Liability (Post-Possession)

Buyer is responsible for real estate taxes after taking possession of the lot/unit.

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Prohibited Community Benefit Fees

Owners/developers cannot charge fees for alleged community benefits.

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Homeowner Association Fees

Fees for common areas (security, sanitation) can only be collected by a homeowners association with majority consent of residents.

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Public Office Access

Owners/developers cannot restrict access to public offices or establishments within the subdivision.

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Right of Way to Public Road

Subdivisions without existing public access need to secure and develop a right-of-way.

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Homeowners Association Organization

Owners/developers must initiate the formation of a homeowners association to manage common areas and interests.

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Non-Forfeiture of Payments

Buyer's installment payments cannot be taken back if the developer fails to complete the project on time.

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Late Payment Rights

Buyer's rights when they fail to pay, except if the delay is because the developer didn't complete the project.

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Contract Effectivity Date

Date a contract was signed. Significant to refunds if the developer breaches rules.

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Title Delivery

Transfer of property ownership documents to the buyer upon full payment.

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Buyer's Rights for Non-Development

Buyer's options when a developer does not fulfill project plans within the time limits.

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Payment Forfeiture

The act of taking back installments paid if a buyer is unable to continue purchasing because of delays in the project

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Section 23

Addresses buyer's protections if the developer fails to fulfill the project on time or in compliance with plans approved.

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Republic Act No. 6552

Philippine law that outlines buyer's rights if they don't pay, not related to developer delays.

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Study Notes

Presidential Decree 957 and 1216

  • PD 957: Subdivision and Condominium Buyers' Protective Decree
  • PD 1216: Amendment requiring subdivision owners/developers to provide adequate roads, alleys and sidewalks in their projects.

Purpose of PDs 957 and 1216

  • Aims to provide proper human settlement and improve the quality of life for inhabitants
  • Addresses failures by real estate developers and sellers to fulfill obligations, thus endangering home and lot buyers.
  • Regulates the sale of subdivision lots and condominiums
  • Addresses issues of fraudulence and swindling impacting the new society's land and housing programs.

PD 957: Definitions

  • Person: Defined term for individuals in the decree.
  • Sale/Sell: Defined term(s)
  • Buy/Purchase: Defined term(s).
  • Condominium project: Defined term.
  • Condominium unit: Defined term.
  • Owner: Defined term.
  • Developer: Defined term.
  • Dealer: Defined term.
  • Broker: Defined term.
  • Salesman: Defined term.
  • Authority: Refers to the National Housing Authority.

Registration and License to Sell

  • National Housing Authority has exclusive jurisdiction to regulate real estate.
  • Registered land owners wishing to subdivide must submit subdivision plans to the Authority.
  • Plans must comply with the Subdivision Standards and Regulations in effect at submission time.

Registration Process for Subdivision and Condominium Projects

  • Subdivision Plan: Approved plan is submitted to the Director of Lands. Further approval and adherence to Land Registration Act procedures.
  • Condominium Plan: Plan requires approval, ensuring compliance with the National Building Code (R.A. No. 6541). Then submitted to Register of Deeds.

Registration with the Authority

  • Project owners or real estate dealers must register projects by filing a sworn registration statement.
  • Required information includes:
    • Owner's name.
    • Principal business office location.
    • Directors' and officers' names and addresses.
    • Business character.
    • Capitalization details (including stock information).

Documents Required

  • Approved subdivision/condominium plan copy.
  • Marketing materials (brochures, prospectuses, advertisements).
  • Financial statements, articles of incorporation/partnership, amendments and existing bylaws for business firms.
  • Title free from encumbrances. Mortgages must be released upon full payment.

License to Sell and Performance Bond

  • Registration certificate holders cannot sell subdivision lots/condominium units without a license.
  • License to sell issued within 2 weeks of project registration.
  • Adequate performance bond required to guarantee construction and maintenance of roads, gutters, drainage, sewerage, water system, lighting systems and full project development (approved by Authority).

Exempt Transactions

  • No license/performance bond required for sales resulting from co-owner land partition.
  • No license/performance bond for sales by original buyer or subsequent sale of the same subdivided lot, nor for mortgagee sales in the normal course of business when liquidating a bona fide debt.

Suspension of License to Sell

  • Authority may suspend license upon verified complaint alleging buyers' or interested parties' concerns of subdivision/condominium unit problems. Further investigation and hearing follows.

Revocation of Registration Certificate and License to Sell

  • Authority can revoke registration if satisfactory evidence exists that the owner/dealer is insolvent; violated rules/regulations; engaged in fraudulent transactions; misrepresented project; conducts business unsatisfactorily.

Registers of Subdivision Lots and Condominium Units

  • Authority maintains a record of subdivision and condominium units and status updates (orders).
  • Records are open to public inspection.

Registration of Dealers, Brokers and Salesmen

  • Dealers, brokers, and salesmen must register with the Authority.

Revocation of Registration

  • Authority may revoke registration for violations of the Decree, false statements in application, fraudulent acts in sales, proven unworthiness to conduct dealer/broker/salesman business

Sections 14 to 19 details

  • Contempt procedures.
  • Decision deadlines for cases.
  • Requirements for mortgage approvals.
  • Advertisement standards and requirements.

Time of Completion

  • Owners/developers must complete structures/facilities within one year from license issuance.

Sales Prior to Decree

  • Owners/developers (for sales prior to decree enforcement) must comply with obligations within two years of decree.

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Related Documents

Presidential Decree 957 and 1216 PDF

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