QuestionsQuestions (Republic Act No. 6552)
RA 6552 is the “Realty Installment Buyer Protection Act.” Its public policy is to protect buyers of real estate on installment payments against onerous and oppressive conditions.
Covered are transactions/contracts involving the sale or financing of real estate on installment payments, including residential condominium apartments. Excluded are industrial lots, commercial buildings, and sales to tenants under RA 3844 as amended by RA 6389.
When the buyer has paid at least two (2) years of installments and then defaults in paying the succeeding installments.
The buyer may pay the unpaid installments due within the total grace period earned, fixed at one (1) month grace period for every one (1) year of installment payments made.
Only once in every five (5) years of the life of the contract and its extensions, if any.
The seller shall refund the cash surrender value of the payments equivalent to fifty percent (50%) of the payments made, and after five (5) years of installments, an additional five percent (5%) every year, but not to exceed ninety percent (90%) of the total payments made.
Actual cancellation takes place after thirty (30) days from receipt by the buyer of the notice of cancellation or the demand for rescission of the contract by a notarial act, and only upon full payment of the cash surrender value to the buyer.
Yes. They are included in the computation of the total number of installment payments made.
The seller must give a grace period of not less than sixty (60) days from the date the installment became due.
If the buyer fails to pay at the expiration of the grace period, the seller may cancel the contract after thirty (30) days from receipt by the buyer of the notice of cancellation or the demand for rescission of the contract by a notarial act.
The buyer may sell his rights/assign them to another person or reinstate the contract by updating the account during the grace period and before actual cancellation or the contract. The deed of sale/assignment must be done by notarial act.
The buyer may pay in advance any installment or the full unpaid balance any time without interest and must have the full payment of the purchase price annotated in the certificate of title covering the property.
Any stipulation contrary to those sections is null and void.
If any provision is held invalid or unconstitutional, no other provision is affected.
It took effect upon its approval on September 14, 1972.