Can’t Pay Mortgage Anymore



Question: We have purchased a piece of land in Antipolo to be paid for 4 years. something bad happened in my job and now i am getting a hard time paying monthly payments. my question is what will happen if I stop paying? will we be able to get portion of the money we paid? what other options I have if I decide to give up the land? thanks a lot.

Answer:

Maceda Law ( R.A. 6552 ) was enacted to protect installment buyers of real estate against onerous and oppressive conditions. It applies to sale or financing of residential real estate on installment payment covered by contract to sell and not sale with mortgage, but excluding industrial lots, commercial buildings, and sales to tenants under RA 3844.

Your rights, if you have paid two years or more of installments:

  • to pay without additional interest, any installment due within the grace period of one month for every year of installment payment,
    provided that such right can only be availed of once every five years.
  • to receive a thirty-day notarial notice of cancellation before your contract can be cancelled for delinquency.
  • to receive a cash surrender value of his total payment before his contract can be cancelled due to delinquency. The refund is
    equivalent to fifty percent (50%) of total payments.
  • to transfer or assign his right to the contract.
  • to register or annotate his contract on the title.
  • to pay without additional interest, the full principal balance of the price before the term of the contract..

Your rights, if you have paid less than two years of installment: you have practically the same rights as a buyer who has paid two years or more of installment except for the following differences:

  • the grace period to pay without additional interest any installment due is fixed at sixty (60) days.
  • for cancellation of contract due to delinquency, the buyer is only entitled to receive a thirty-day (30) notarial notice of cancellation,
    but without right to receive the cash surrender value of his payments.

Your other option is to find a ready buyer…who maybe your relatives, friends, officemates, neighbors who is willing to pay you the amount you have paid so far and assume the payment of remaining balance. This is one of your rights as stated above.

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