How to Buy Property in the Philippines

  • Lionunion by Lionunion
  • 11 months ago
  • FAQ

In general, buying a piece of property in the Philippines is as simple as completing all requirements and obtaining the notarized Deed of Sale.

But while the process may sound simple, there are various steps involved depending on the type of property being bought.

Step 1: Research properties that are for sale in your area

Look at real estate listings in your area to get an idea of how much properties are selling for. You may also get a real estate agent to help you find properties that are perfect for your needs.

Step 2: Verify ownership and see if there are possible issues by checking the documents

You’ve probably heard horror stories of people buying properties from scammers. Thankfully, this expensive mistake can be avoided through this step.

Before buying any property, verify who the real owner is. Make sure you’re only transacting with the rightful owner or their authorized representative.

To verify the owner, ask for a photocopy of the title and double-check the certified true copy of the title from the Register of Deeds. Make sure it shows the owner’s name there.

Aside from that, you also need to make sure there are no issues related to the property that may possibly come up and give you problems in the future.

Always check what is described in the title. It should completely match the property being sold. If there are technical descriptions you’re not familiar with, seek the help of a surveyor.

You should also ask for the tax declaration copy to ensure the annual taxes of the property are paid and that you won’t have penalties to settle in the future.

Next, look into the right of way and check if you’re satisfied with your access to the property.

Step 3: Secure a notarized and signed deed of sale

After you validate that you’re transacting with the rightful owner and there are no issues related to the property, it’s time to proceed with the sale. In this step, you must secure a notarized and signed deed of sale. This document will identify who the buyer and seller are, as well as who will settle the gains and documentary stamp tax.

Step 4: Pay for BIR fees and transfer taxes

After the signing of the deed of sale, the party assigned must pay fees to the BIR within 30 days. These documents must also be taken care of:

Original and photocopy of deed of absolute sale
Tax declaration for land and improvement (if applicable)
Original and photocopy of transfer certificate of title
Buyer’s and seller’s tax ID numbers
After this, you need to take care of the assessment of transfer taxes and get its documentation. The Bureau of Internal Revenue will calculate the Capital Gains Tax and Documentary Stamp tax. Signed copies of BIR Forms 2000 and 1706 are also required.

After completing these, submit and file them at the City of Municipal Treasurer’s office or the authorized agent bank.

Step 5: Process the CAR

After this, you need to take care of the Certificate Authorizing Registration. To secure this document, file the CGT and DST documents at the BIR. You will be issued a claim slip to use for:

Tax clearance (original)
BIR-Stamped Absolute Deed of Sale (original)
Owner’s copy of Transfer of Certificate title
Official receipts of tax clearance certificates, CGT, DST, and transfer fee
Latest tax declaration for land and improvement (original)

Step 6: Get a new tax declaration copy

You’re not done yet. After completing the steps above, get a new copy of the Tax Declaration document from your Provincial or Municipal Assessor’s office. This document will usually be released five days after you present the documents below.

Transfer Certificate Title
Deed of Absolute Sale
Certificate Authorizing Registration

Step 7: Issue a new title under your name

You’re finally at the last step. After you settle all the payments and sign the documents needed, the old land title will be canceled by the Registry of Deeds.

Then, you will be issued a new one under your name. You can get a copy of your title from the City Assessor’s Office.

Source: grit

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