QuestionsQuestions (LRA CIRCULAR NO. 60)
The exemption is under Republic Act (RA) No. 7353 (Rural Bank Act of 1992), specifically Section 6, paragraph 3.
It provides that foreclosure of mortgages on loans granted by rural banks may be exempt from newspaper publication requirements under stated conditions, using posting instead.
The total amount of the loan excluding interest due and unpaid must not exceed PHP 100,000.00 (or such other amount the Monetary Board may prescribe). It means the principal loan amount is used for the limit, not the unpaid interest.
The Monetary Board may prescribe a different amount “as may be warranted by prevailing economic conditions.”
Posting notices of foreclosure and execution of judgment in the most conspicuous area of (1) the municipal building, (2) municipal public market, (3) the rural bank, (4) barangay hall, and (5) barangay public market (if any), where the land mortgage is situated.
For sixty (60) days immediately preceding the public auction or execution of judgment.
Proof is accomplished by an affidavit of the sheriff or officer conducting the foreclosure sale or execution of judgment, attached to the records of the case.
No. The law preserves redemption rights. Redemption is allowed within one (1) year from the date of foreclosure for land not covered by a Torrens Title, and one (1) year from the date of registration of the foreclosure for Torrens-covered land.
The provision states that “borrowers, especially those who are mere tenants,” need only to secure their loans with the procedure corresponding to their share.
A rural bank is allowed to foreclose lands mortgaged to it provided that the lands are covered under RA 6657 (Comprehensive Agrarian Reform Law).
No. LRA Circular No. 60 states that real estate mortgages executed and registered before RA 7353’s effectivity (April 2, 1992) but foreclosed after its effectivity are likewise covered, provided the loan limit is met and posting/proof requirements are complied with.
The loan amount (excluding unpaid interest) must not exceed PHP 100,000.00, and the required posting and proof of publication must be complied with.
It guides compliance by emphasizing that the statutory exemption applies not only prospectively, but also to certain foreclosures of mortgages registered before RA 7353’s effectivity, subject to the conditions stated.
The notices of foreclosure and execution of judgment must be posted for sixty (60) days immediately preceding the public auction or the execution of judgment.
It refers to the sale of the mortgaged real property at foreclosure where the sheriff conducts the auction as part of executing the foreclosure judgment.
For land covered by a Torrens Title, redemption must be made within one (1) year from the date of registration of the foreclosure.