These questions are the ones we encounter on a regular basis. Hopefully as someone who’s interested in bidding/buying on foreclosed properties/acquired assets, you will take the time to read this article.

1. Do you need to spend some time learning the process before you can get good at it?
Buying through foreclosure is a specialty and that you must likely will have to spend some time learning the ropes and learning how not to get burned.

2. How does the bank treat foreclosures?
Banks who acquired assets through foreclosure have a problem. Why? Because they are not in the real estate business and the banking regulators don’t like it when the bank forecloses. Foreclosure is seen by the regulators as evidence that the bank does not observe good lending practices. Because if it did the property would have never gone into foreclosure. The regulators may even write the bank up for making lending mistakes…not a happy outcome for the bank!

3. Do foreclosed properties have clean titles?
Yes, titles are already transferred under the name of the bank which foreclosed the properties. Although there are some properties with issues or concerns because titles are still in the process of transfer to the name bank which foreclosed the properties.

4. Are there other minor or major issues the buyer has to deal with in buying foreclosed property?
Yes, such as property occupied by the former owner which is still contesting the foreclosure process in court. The buyer could talk to the owner and reach out an agreement that will be beneficial to both and to save on a lot of costs imposed by the bank. A number of times the properties are occupied by illegal occupants or squatters. Tax declaration is also one aspect which may delay consolidation of documents or transfer of the properties under the bank name. Right of way is also one issue which the buyer will have to rectify himself.

5. Are there caretakers manning/guarding bank’s foreclosed properties?
Yes, there are caretakers manning bank’s foreclosed properties, specially the high valued properties ( 10M –up). No assigned caretakers for low valued properties ( 2M-below) due to cost of maintenance. These low-cost properties are sold on: “ sale as is, where is, basis” and buyers have to the take care of ejecting the illegal occupants. If you leave the job of ejection with the bank, then it may take forever specially for low valued properties

6. What is the price a buyer has to offer to purchase foreclosed property?
If the indicative price is stated, buyer could offer this price or 10% lower to take care of other charges when the sales materializes. In sealed bidding, if the floor price is indicated, the buyer could only offer price equal or higher than floor price.

7. Can a buyer avail of Pagibig loan to buy foreclosed property?
Yes, Pagibig housing loan may be used to finance purchase of acquired asset which is disposed of through sealed public bidding and negotiated sale. Take note Pagibig member shall be allowed to borrow an amount up to a maximum of 2M Pesos only.

8. Can a buyer avail of bank financing?
Yes, a buyer can avail of bank financing depending on his capacity to pay, but he or she has to pay the 25% downpayment in cash. The balance of 75%: through BDO, PNB or BPI or other banks which will charge their prevailing interest rate at the time of loan approval.

• It’s Thunderbird Resort’s first real estate project in Asia that aims to be the premiere leisure & wellness residential community in Northern Luzon
• It’s a distinct development combining hotel, casino, beach & golf club facilities with a real estate community that sells house & lots on a leasehold right
• Target Market: Class A-B locally based Filipinos & OFWs (Metro Manila & Regions 1-3) & foreigners
• Will have wellness programs will feature services of medical, behavioral & nutrition experts that will support healthy living for residents & resort patrons

How does Thunderbird Resort’s lease affect home ownership?

• Thunderbird Pilipinas Hotels & Resorts Inc. (TPHRI) currently has a 47-year lease period in a signed agreement with the BCDA
• Buyers will be issued a limited warranty deed that entitles buyers similar rights as that of titled property; it asserts that lot ownership is dependent on Thunderbird Pilipinas’ lease contract with the BCDA & is automatically extended with every renewal
• Each 25-year lease renewal is automatically extended to lot owners

Q: What will happen to the Limited Warranty Deed if the lease is not renewed? Does this mean that I will pay for the lot & build a house but will release ownership when the lease expires?

Should the lease not be renewed, the property including all improvements will be returned to BCDA. The likelihood of this happening though is quite remote. Thunderbird Pilipinas (TPHRI) as developer, with interests in its hotel, golf course, casino & real estate investments, will be ensuring & spearheading the continuity of this enduring lease

What are the competitive advantages of The Point Residences?

• Free membership to the Beach & Golf Club
• Entire Property is guarded 24/7
• 5-minutes drive to the International Airport
• Lot positions offer great sea & golf course views
• Unique Mediterranean Concept
• VAT exemption
• Existing facilities operational since 2006…

What are the site development details of the project?

• Total allotted area for development = 15 hectares
• Total no. of lots & condos= 139 lots & 2 condos
  • Phase 1 = 39 lots
  • Phase 2 = 40 lots
  • Phase 3 = 60 lots
  • Phase 1 Mid-rise Condominium Development
  • Phase 2 Mid-rise Condominium Development
• Lot Sizes for Phase 1
  • Ranges from 300-450 sqm
• Lot Prices in Phase 1
  • Range from Php 7,705-9,200/sqm
• House Construction Cost with Impact Asia
  • Php 35,000/sqm

What are the amenities of the project?

Facilities
- Health & Wellness Center
- The Point Clubhouse
- Event Hall & Function Rooms
- Fitness Gym & Spa
- Commercial Center
- Chapel & Meditation Garden
- Wedding Cliff Pavilion
- Kid’s Pavilion & Play Area
- Basketball Court
- Tennis Court
- Swimming Pools
- Jog Path

Residential Services
- Housekeeping
- Laundry
- Landscaping
- Waste Management
- Shuttle Services
- Automated Community Gates
- 24 Hour Security
- CCTV Surveillance Network
- Rental Program

Q: What type of payment schemes do you have?

For lots in-house financing plans, we have 4 options:

1) Cash Payment With 12% Discount
2) 12 months, 20% DP, 5% Discount, 0% Interest
3) 24 months, No DP, 12% Interest
4) 60 months, Payment with 20% DP, No Discount & 12% Interest Rate

For more flexible payment schemes, inquire with your Broker or Property Specialist on other available options. Further, we are also currently under negotiations with major banks for project accreditation.

Q: How much will the homeowner’s association fee be? Are there any other fees relevant to homeowners?

Association dues will only be charged when there is an established Homeowner’s Association that will only be set up once there is a slightly populated residential area. Such development will be announced in due time.

Free Golf & Beach Club Membership that comes attached with lot purchases will incur monthly fees if actively used & are charged P1,500 & P750 respectively.

Q: When is the turnover for house & lots?

Construction of Phase 1 is expected to start by Quarter 4 of 2010.
Q: What is expected to of the commercial area in the vicinity?

The commercial area located in Phase 1 across the hotel will be a 2-storey building & will feature a coffee shop, some restaurants, convenience store & Wellness Center.

Q: Can buyers construct houses with the design & contractor of our choice?

Lot owners have the choice to use their own architectural designs given that they follow the provisions of the Deed of Restrictions. They can also their house built either by IMPACT ASIA, The Point’s official General Contractor or their preferred personal contractor.

Q: Can foreigners directly buy house & lots in this project?

Yes, foreigners may purchase house & lots at The Point. Philippine Law in general states that foreigners or non-Philippine nationals may purchase condominiums, buildings, & enter into a long term land leases, that covers this development.

Buying a Real Estate Property in the Philippines or for any country for that matter requires due diligence by the prospective buyer: from searching for a property to finalizing the sale. Although a broker can help you furnish these documentary requirements, it’s always best to know in advance. Here are some basic questions to help you when buying a new house & lot:

1. Is your broker/agent accredited by the developer to sell their projects?

2. Is your developer credible? Had they ever had an unfinished project? Do you have friends or know anyone who has bought from this developer and what can they say about their purchases?

3, Are there any tenants in the property? Are their illegal squatters? Will you have a difficult time ejecting them? Does the developer know about this and have they made moves towards resolving it?

4. How secure is the area? Are there any security measures or precautions in place to safeguard against robbers, illegal squatters and the likes?

5. With 2009′s Ondoy flooding, how safe is your area from flash floods or landslide(natural calamities)? What has your developer done to address these?

6. Do you know the exact location of the property you are buying (this is targeted towards ofws who rely on relatives to decide for them when buying a property, take extra precaution because you’ll never know if block 9 lot 10 is on the edge of ravine!)

7. Does the measurement of the property reflect what is written in the technical description and title? Is the measurement accurate?

8. How is the water/electric situation in the area? Do you have clean water? Do you have stable electricity?

9. Are the materials used for the house (if buying a house) durable and in agreement with the ones stated on the contract? Or as promised by the developer?

10. What are the ordinances in the area about the height restrictions for buildings?

Here’s hoping your questions are answered MORE than adequately!

A. Mandatory Requirements (Taxable/Exempt)

• Tin of all Donors
• Notarized Deed of Donation
• Certified True copy of the latest Tax Declaration issued by the Local Assessor’s Office for land and improvement applicable to the taxable transaction
• Owner’s copy for presentation purposes only together with the photocopy thereof for authentication or Certified True Copy of Transfer Certificate of Title (TCT), Condominium Certificate of Title (CCT), Original Certificate of Title (OCT).
• Sworn declaration of No Improvement by at least one (1) of the transferees or Certificate of No Improvement issues by the Assessor’s office, if applicable.
• Proof that the Donee is a qualified relative of the Donor, if the donation if being taxed using the schedular rates (e.g. Birth Certificate, Marriage Contract, Baptismal Certificate, affidavit of a third party)
• Official Receipts/Deposit slip for this purpose and duly validated return as proof of payment

B. Additional Requirements: If applicable

1. For Personal Properties

• Proof of valuation of shares of stock at the time of donation

• a. For listed stocks – certification of the price index from the PSE/latest FMV publishes in newspapers at the time of transaction
• b. For unlisted stocks – latest audited financial statements of the issuing corporation with computation of the book value per share.

• Certificate of deposit/investment/indebtness/stocks for donated cash or securities
• Certificate of Registration of motor vehicle, if any.

2. Others

• Special Power of Attorney, if the signatory on the document is not the owner as appearing on the title
• Certificate of Exemption/BIR Ruling issues by the Commissioner of the Internal Revenue or his Authorized representative if tax exempt.
• Such other requirements as may be required by law/rulings/regulations/other issuances.

Foreclosure occurs when a lender or other lien holder (person or organization that has the right to seize your property for payment on a debt) takes possession of a property because the property owner has failed to make regular, timely payments, and other efforts to collect the money have failed.

Most people know that foreclosure can occur when a homeowner fails to make mortgage payments, but foreclosure can also occur if a homeowner fails to pay property taxes, homeowners’ association assessments or contractor’s bills.

After a creditor takes possession of a home through foreclosure, the creditor usually wants to quickly sell the property, rather than bear the expense of maintenance, security and upkeep. If you are a potential homebuyer, you may find good deals on homes being sold through foreclosure.

You can find information about homes in foreclosure from:

* Local newspapers
* Subscription newsletters
* The county deed recorder’s office
* Lenders’ Web sites

Buying from a Bank after Foreclosure

There’s little risk involved with property a bank has seized through foreclosure. The bank will generally pay any other outstanding debts, such as property taxes or amounts owed to the IRS, in order to sell the house with a clear title. Plus, the bank will have already evicted the tenants or former homeowners, and appraised the house before attempting to resell it.

A bank has the flexibility to negotiate on the selling price, down payment, interest rate and closing costs. Added together, these factors can make a big difference in whether you can afford a home, especially for first-time homebuyers.
Buying from the Homeowner Prior to Foreclosure

If you can communicate with a homeowner whose property is facing foreclosure, it may be possible to buy a house by giving the homeowner a small amount of cash in exchange for any equity in the house. You’ll then be responsible for paying any outstanding debts.

But it’s important to thoroughly check out any existing liens or other debts on the property, so you know what you’re getting into. You may be able to negotiate a discounted settlement with any lien holders.

You’ll also want to inspect the property and estimate the costs of necessary repairs. If the costs of paying off the lender, cashing out the homeowner and making repairs are more than the fair-market value of the home, it’s a bad deal.

If you decide to purchase the property directly from the homeowner, it’s important to have a local real estate lawyer draft the purchase agreement.
Buying at a Foreclosure Auction

Buying at a foreclosure auction is the riskiest way to purchase foreclosed property, and shouldn’t be attempted by a first-time buyer.

You may not be able to inspect the property, and will likely have to come up with the entire purchase price in cash in a short period of time (sometimes measured in hours rather than days). Plus you’ll still end up owing any unpaid property taxes and junior liens (debts put on the property after the debt which caused the property to kick into legal foreclosure).

Buying at auction also comes with the possibility that the former owner will exercise their right of redemption by coming up with the cash to buy the house back within a certain period of time. The IRS also has 120 days to redeem the property if back taxes are owed. A local real estate lawyer can fill you in on the redemption laws in your state.

If you’re tempted to buy at a foreclosure auction:

* Research the condition of the property and any existing debts such as liens, unpaid taxes and previous construction debts, by ordering a full title search on the property
* Scope out land use problems such as zoning or toxic waste issues
* Find out how the auction process and rules work
* Sit in on some other auctions ahead of time
* Decide what your maximum offer will be and don’t go above it
* Arrange any financing you may need ahead of time

Buying a HUD Home

The US Department of Housing and Urban Development (known as HUD) often has houses for sale which are sold to the public after HUD or FHA mortgage foreclosures.

HUD properties are sold “as is” on a cash basis through a conventional lender other than HUD. You can only purchase HUD property through an approved HUD broker or agent, who will submit an offer for you. Buyers can also request that HUD pay some or all of the financing and closing costs.

HUD maintains an online list of homes for sale.
Disadvantage to Buying a Foreclosed Home

One disadvantage to buying a foreclosed home is that the property may be sold “as is,” so it’s important to inspect carefully and budget for any needed repairs. As foreclosure rates have increased, some unhappy homeowners facing foreclosure have been known to damage a home before moving out. Before buying a foreclosed home, it’s important to get a complete assessment of all damage and understand how much it will cost to repair the home.

source: lawyers.com

How do Foreclosures Work Video

If you want to read the transcript, see below. It’s good read and applicable to most Foreclosed Properties in the Philippines.

Transcript: How Do Foreclosures Work?

Hi, I’m Elizabeth Weintraub for About.com. Homebuyers think of pursuing foreclosures in a real estate market as a good deal. You may have an idea of a picture perfect house whose owner fell on hard times but your idea may be removed from reality quite far. So let me explain to you how foreclosures work.

Reasons for Foreclosure
The sellers may stop making payments for a variety of reasons. Most common are getting laid off from work, a divorce or excessive bill obligations. There are very few cases of people voluntarily going to foreclosures so keep that in mind if you choose to pursue one.

Buying a Foreclosed Home
There are three ways to buy a home in foreclosure. You can buy a home from seller before the foreclosure is final, at the county courthouse steps during the auction or you can buy the home after foreclosure, directly from the bank. Foreclosure procedures vary from state to state.

Potential Issues With Foreclosures
Also, realize that buying a foreclosed home brings about a host of emotional issue. You need to decide whether you are a type of person that will take advantage of a seller’s misfortune and/or put a family out on a street.
Damaged Property and Foreclosures

Moreover, you need to know that a bank-owned foreclosure home may be vandalized or stripped by the angry home owners so it will be ‘as is’. If something breaks or malfunctions, the current owners will not fix it. They previous owners sell appliances or try to destroy a home by flooding it.

And finally, you may need to evict the tenant or owner of the premises when you receive the title. Buying a foreclosed home is not for the faint of heart. It is not recommended by the first home buyers.

NET LISTING
A listing which provides that the agent may retain as compensation for his services all sums received over and above a net price to the owner.

NOTE
A signed written instrument acknowledging a debt and promising payment.

NOTICE OF QUIT
A notice to a tenant to vacate rented property.

OBSOLENCE
Loss in value due to reduced desirability and usefulness of a structure because its design and construction become obsolete; loss because of becoming old-fashioned and not in keeping with the modern need with consequent loss of income.

OFFSET STATEMENT
A statement by the owner of property or the owner of a lien against property, setting forth the present status of lien against the said property.

OPEN MORTGAGE
A mortgage which can be paid off any time even before its maturity.

OPEN-END MORTGAGE
A mortgage containing a clause which permits a mortgagor to borrow additional money after the loan was reduced, without re-writing the mortgage.

OPEN LISTING
An authorization given by a property owner to a real estate agent wherein said agent is given the non-exclusive right to secure a purchaser; open listing may be given to any number of agents without liability to compensate any except the one who first secures a buyer ready, willing and able to meet the terms of the listing or secures the acceptance by the seller of a satisfactory offer.

OPTION
A right given for a consideration to purchase or lease a property upon specified terms within a specified time.

ORAL CONTRACT
A verbal agreement; one who is not reduced to writing.

OVER-IMPROVEMENT
An improvement which is not suitable to the site on which it is placed due to excessive size or cost.

PARTNERSHIP
A partnership as between partners themselves maybe defined to become a contract of two or more persons to unite their property, labor or skill, or some of them in persecution or some joint or lawful business, and to share the profits in certain proportions.

PAR VALUE
Market value, nominal value.

PATENT
A conveyance of title to government land.

PERCENTAGE LEASE
A lease of property in which the rental is based upon the volume of sales made upon the leased premises.

PERSONAL PROPERTY
Any property which is not real property.

PLEDGE
The depositing of personal property by a debtor with a creditor as security for a debt arrangement.

PLEDGEE
One who is given a pledge or a security.

PLEDGOR
One who offers a pledge or gives security.

POLICE POWER
The right of the state to enact laws and enforce them for the order, safety, health, morals and general welfare of
the public.

POWER OF ATTORNEY
An instrument authorizing a person to act as the agent of the person granting it, and a general power
authorizing the act generally in behalf of the principal. As special power limits the agent to a particular or specific act as: a
land-owner may grant an agent special power of attorney to convey a single and specific parcel of property. Under the provisions of
a general power of attorney, the agent having the power may convey any or all property of the principal granting the general power of attorney.

PRESCRIPTION
The securing of title to property by adverse possession: by occupying it for the period determined by the law barring action for recovery.

PRIMA FACIE
Presumptive on its face.

PRINCIPAL
The employer of an agent.

PRIVITY
A mutual relationship to the same rights of property; a contractual relationship.

PROCURING CAUSE
The act of a broker leading to the meeting of minds between the parties to a transaction or the
consummation of transaction.

PROGRESSION, PRINCIPLE OF
The association of a property with inferior properties will tend to lower the value of the former.

PRORATION OF TAXES
To divide or prorate the taxed equally or proportionately to the time of use.

PURCHASE MONEY MORTGAGE OR TRUST DEED
A trust or mortgage given as part or call of the purchase consideration for property.

QUIET TITLE
A court action brought to establish title: to remove a cloud on the title.

QUITCLAIM DEED
A deed to relinquish any interest in property which the grantor may have

REAL ESTATE
Real property. Property in land and improvements that which is not personal property.

REAL ESTATE BOARD
An organization where members consist of primarily of real estate brokers and salesmen.

REALTOR
A real estate broker holding active membership in a real estate board affiliated with the Philippine Association of Realtors Boards.

RECONVEYANCE
The transfer of the title of the land from one person to the immediate preceding owner.

REDEMPTION
Buying back one’s property after a judicial sale.

REFORMATION
An action to correct a mistake in deed or other document.

RELEASE CAUSE
This is a stipulation that, upon the payment of a specific sum of money to the holder of a trust deed or mortgage, the lien of the instrument as to a specific described lot or area shall be removed from the blanker lien on the whole area involved.

RESCISSION OF CONTRACT
The abrogation or annulling of a contract; the revocation or repealing of a contract by mutual consent by the parties to the contract, or for cause by either party to the contract.

RESERVATION
A right retained by a grantor in conveying property.

RESTRICTION
The term as used relating to real property, means the owner of real property is restricted in or prohibited from doing certain things relating to the property for certain purposes. For instance, the requirements in a deed that a lot maybe used for the construction of not more than a one-party dwelling, costing not less than ten thousand pesos (P10,000.00), is deemed to be restriction: also a legislative ordinance affecting all properties in a given area, requiring that improvement on property shall not be constructed any closer than twenty feet from the street curb, is a restriction by operation of law.

REVERSION
The right to future possession or enjoyment by the person, or his heirs, creating the preceding estate.

REVERSIONARY INTEREST
The interest which a person has in lands or other property, upon the termination of preceding estate.

RIGHT OF SURVIVORSHIP
The right to acquire the interest of a deceased joint-owner; distinguished feature of a joint tenancy.

RIGHT OF WAY
A privilege operating as an easement upon land, whereby the owner does by grant, or by agreement, give to another the right to pass over his land; to construct a roadway over, or use as a roadway, a specific part of his land, telephone, telegraph, or electric power lines, or the right to place underground water mains, gas mains or sewer mains.

RIPARIAN RIGHTS
The right of a landowner to water, on, under, or adjacent to his land.

SALE AND LEASEBACK
A contract wherein the buyer of a property agrees to lease the same property to the seller.

SALES CONTRACT
A contract by which a buyer and a seller agree to terms of sale.

SATISFACTION
The discharge of a mortgage or a trust deed lien from the records upon payment of the evidence debt.

SEAL
An impression made to attest the execution of an instrument.

SETBACK
The distance from the curb or other established line, within which no building may be erected.

SHERIFF’S DEED
A deed given by the court order in connection with the sale of property to satisfy a judgment.

SPECIAL ASSESSMENT
A legal charge against real estate by a public authority to pay the cost of public improvements such as street light, sidewalks, street improvements, etc.

SPECIFIC PERFORMANCE
A remedy in court compelling the defendant to carry-out the terms of the agreement of contract which was executed.

STATUTE OF FRAUDS
A state of law which provides that certain contracts must be in writing in order to be enforceable at law. Examples: a real property lease for more than one year; an agent’s authorization to sell real estates.

STEWARDSHIP CONCEPT OF OWNERSHIP
Obliges owners to utilize their property in a manner that will benefit not only their interest but also the general welfare. When the extent of one’s ownership exceeds the requirements of his necessities or when property utilization is not conductive to general welfare, then the state may exercise its power and authority to regulate or control ownership.

SUBORDINATION CLAUSE
A clause in a junior or second lien permitting retention of priority for prior liens. A subordination clause may also be used in a first deed of trust permitting it to be subordinated to subsequent liens, as, for example: the liens of construction loans.

SUBPOENA
A process to cause a witness to appear and give testimony.

SUBSTITUTION PRINCIPLE OF
The value of replaceable property tends to be indicated by the value of an equally desirable substitute property.

SURETY
One who guarantees the performance of another. Guarantor.

TAX SALE
A sale of property after a period of non-payment of taxes.

TENANCY IN COMMON
Ownership by two or more persons who hold undivided interest, without right or survivorship, interest need not be equal.

TENURE IN LAND
The mode or manner by which a man has an estate in lands.

TIME IS OF THE ESSENCE
One of the essential requirements to forming of a binding contract: contemplates a punctual performance.

TITLE
Evidence that the owner of land is in lawful possession thereof; an instrument evidencing the ownership.

TITLE INSURANCE
Insurance written by a title company to protect a property owner against loss of the title.

TOPOGRAPHY
The nature of the surface of land; topography may be level, rolling, mountainous.

TORRENS TITLE
A system of title records provided by law; a certificate issued by register of deeds.

TRUST DEED
A deed given by a borrower to a trustee to be held pending fulfillment of an obligation, which is ordinarily repayment of a loan to a beneficiary.

TRUSTEE
One who holds property in trust for another to secure the performance of an obligation.

TRUSTOR
One who deeds his property to a trustee to hold as security until he has performed his obligation to a lender under terms of a deed of trust.

UNEARNED INCREMENT
Increase in value of real property without any effort of or cost to the owner.

UNDER-IMPROVEMENT
An improvement which is not suitable to the site on which it is placed due to deficient size or cost.

URBAN LAND
Land which partakes the nature of both rural land and urban land; usually found of a city, which has a characteristics or atmosphere of a province while enjoying the amenities of an urban land.

URBAN PROPERTY
City property; closely settled property.

USURY
On a loan, claiming a rate of interest greater than that permitted by law.

VALID
Having force or binding force; legally sufficient and authorized by law.

VALUATION
Estimated worth of price: Estimate, the act of valuing by appraisal.

VENDEE
A purchaser; a buyer.

VENDOR
A seller: one who disposes of a thing in consideration of money.

VERIFICATION
A sworn statement before a duly qualified officer to the correctness of contents of an instrument.

VESTED
Bestowed upon someone; secured by someone, such as title to property.

VOID
To have no force or effect; that which is unenforceable.

VOIDABLE
That which is capable of being adjudged void, but is not void unless action is taken to make it so.

VOLUNTARY LIEN
Any lien is placed on property with the consent, or as a result of the voluntary act of the owner.

WAIVE
To relinquish or abandon to forego a right to enforce or require anything.

WARRANTY DEED
A deed used to convey real property which contains warranties of titles and quite possession. In a warranty deed, the grantor agrees to defend the premises against the lawful claims of third person.

ZONE
The area set off by the proper authorities for specific use; subject to certain restrictions or restraints.

ZONING
The act of city or municipal authorities specifying the type of use to which property may be put in specific area.

source: www.rpmlx.com

ABSTRACT OF TITLE
A summary of or digest of the conveyances, transfer and any other facts relied on as evidence of title together with any other elements of record which may impair the title.

ACCELERATION CLAUSE
A clause in a trust deed or mortgage giving the lender the right to call all sums owing him to be immediately due and payable upon the happening of a certain event.

ACCEPTANCE
When the seller or agent’s principal agrees to the terms of the agreement of sales approves the negotiations on the part of the agent and acknowledges receipts of the deposit in subscribing to the agreement of sales that act is termed an acceptance.

ACCRETION
An addition to land from natural causes as for example from gradual action of the ocean or river waters.

ACKNOWLEDGMENT
A formal declaration before a duly authorized officer by a person who has executed an instrument that such execution is his act and deed.

ACQUISITION
The act or process by which a person procures prosperity.

ADMINISTRATOR
A person appointed by the private court to administer the estate of a person deceased.

AD VALOREM
According to valuation.

ADVERSE POSSESSION
The open and notorious possession and occupancy under an evident claim or right, in denial or opposition to the title of another claimant.

AFFIDAVIT
A statement or declaration reduced to writing sworn to or affirmed before some officer who has authority to administer an oath or affirmation.

AFFIRM
To confirm, to aver, to ratify, to verify.

AGENT
One who represents another from whom he has derived authority. An employee of the principal.

AGREEMENT OF SALE
A written agreement or contract between seller and purchaser on which they reach a meeting of minds on the terms and conditions of the sale.

AIR RIGHT
The right of the property owner to use, control or occupy the air space over his property subject to the requirements of aerial navigations and government regulations.

ALIENATION
The transferring of property to another; the transfer of property and possession of lands, or other things, from one person to another.

ALLUVION
Soil deposited by accretion. An increase of earth on a shore or bank of a river.

AMORTIZATION
The liquidating of a financial obligation on installment basis, also recovery over a period of cost or value.

APPRAISAL
As estimate and opinion of value; a conclusion resulting from the analysis of facts.

APPURTENANCE
Something annexed to another thing which may be transferred incident to it. That which belongs to another thing as a barn, dwelling, garage, or orchard, is incident to the land to which it is attached.

ASSESSED VALUATION
A valuation of property for the purpose of public officer or board as a basis for taxation.

ASSESSED VALUE
Value placed on property as a basis for taxation.

ASSESSMENT
The valuation of property for the purpose of levying a tax or the amount of the tax levied.

ASSESSOR
The official who has the responsibility of determining assessed values.

ASSIGNMENT
A transfer to another of the whole of any property real or personal in possession or in action, or of any estate or right there in.

ASSIGNOR
One who assigns or transfer property.

ASSIGNS ASSIGNEES
Those to whom property shall have been transferred.

ASSUMPTION OF MORTGAGE
The taking of title to property by a grantee wherein he assumes liability for payment an existing note secured by a mortgage or deed of trust against the property; becoming a co-guarantor for the payment of a mortgage or deed of trust note.

ATTACHMENT
Seizure of property by court order usually done to have it available in the event a judgment is obtained in a pending suit.

ATTORNEY-IN-FACT
One who is authorized to perform certain acts for another under a power of attorney; the power of attorney may be limited to a specific act or acts or it may be general .

AUTOMATIC REDEMPTION CLAUSE
A stipulation in a mortgage of several properties providing that when a buyer of one or more lots pays in full the purchase price a portion of the payment shall be applied to the mortgage obligation and the mortgagee shall correspondingly release said lot or lots from the mortgage.

AVULSION
The sudden tearing away or removal of land by action of water flowing over or through it.

BACKFILL
The replacement of excavated earth in a a hole or against a structure.

BALLOON PAYMENT
Where the final installment payment on a note is greater than the preceding installment payments and it pays the note in full such a final installment is termed a balloon payment.

BASE AND MERIDIAN
Imaginary lines used by surveyors to find and describe the location or private or public land.

BENCH MARKS
A location indicated on a durable marker by surveyors.

BENEFICIARY
(1) One entitled to the benefit of a trust: (2) One who receives profit from an estate, the title of which is vested in a trustee: (3) The lender on the security of a note and deed of trust.

BEQUEATH
To give or hand down by a will; to leave by a will.

BEQUEST
That which is given by the terms of a will.

BLANKET MORTGAGE
A single mortgage which covers more than one piece of real estate.

BLIGHTED AREA
A declining area in which real property values are seriously affected by destructive economic forces such as encroaching inharmonious property usages, infiltration of lower social and economic classes of inhabitants and/or rapidly depreciating buildings.

BONA FIDE
In good faith, without fraud.

BREACH
The breaking of a law or failure of duty either by omission or commission.

BUILDING LINE
A line set by law as a certain distance from a street line in front of which an owner cannot build on his lot. (A setback line)

CAPITALIZATION
In appraising, determining value of a property by considering net income and percentage or reasonable return on the investment.

CAPITALIZATION RATE
A reasonable percentage rate or return based on net income. The capitalization rate is used to determine value.

CAVEAT EMPTOR
Means “let the buyer beware.” The buyer must examine the goods or property and buy at his own risk.

CHAIN OF TITLE
A history of conveyances and encumbrances affecting the title from the time the original patent was granted or as far back as records are available.

CHATTEL MORTGAGE
A personal property mortgage.

CHATTEL REAL
An estate related to real estate such as lease on real property.

CHATTELS
Goods or every purchase of property movable or immoveable which are not real property.

CLOSED MORTGAGE
A mortgage which cannot be paid off until its maturity unless the creditor consents to earlier payment.

CLOUD ON THE TITLE
Any conditions revealed by a title search which affect the title to property; usually relatively unimportant items but which cannot be removed without a quit claim deed or court action.

COLLATERAL SECURITY
A separate obligation attached to a contract to guarantee its performance; the transfer of property or of other contracts or valuables to ensure the performance of a principal agreement.

COLLUSION
An agreement between two or more persons to defraud another of his rights by the forms of law or to obtain an object forbidden by law.

COLOR OF TITLE
That which appears to be a good title but which is not a title in fact.

COMMERCIAL PAPER
Bills of exchange used in commercial title.

COMMISSION
An agent’s compensation for performing the duties of his agency; is real estate practice, a percentage of the selling price of property, percentage of rentals, etc.

COMMITMENT
A pledge or promise or firm agreement.

COMMUNITY OR CONJUGAL PROPERTY
Property accumulated through the joint effort of a husband and wife living together.

COMPACTION
Whenever extra soil is added to a lot to fill in low places or raise the level of the lot the added soil is often too loose and soft to sustain the weight of the building. Therefore, it is necessary to compact the added soil so that it will carry the weight of the building without the danger of their titling, settling or cracking.

COMPOUND INTEREST
Interest paid or original principal and also on accrued and unpaid interest which has accumulated.

CONDEMNATION
This is the act of taking private property for public use by a political subdivision; a declaration that a structure is unfit for use.

CONDITIONAL SALE CONTRACT
A contract for the sale of property stating that delivery is to be made for the buyer, the title is remain vested in the seller until the condition of the contract have been fulfilled.

CONDOMINIUM
A system of individual ownership of a unit in a multi-family structure, combined with joint ownership of a common areas of the structure and the land. (Sometimes referred to as vertical subdivision).

CONSIDERATION
Anything of value given to induce entering into a contract, it may be money, personal service, or even love and affection.

CONSTRUCTIVE NOTICE
Notice given by the public records.

CONTRACT
An Agreement, either written or oral to do or not to do certain things.

CONTRACT RENT
The rent for the lease of property as stimulated by the lessor and the lessee.

CONVERSION
A change from one character or use to another.

CONVEYANCE
The transfer of the title of land from one to another. It denotes an instrument which carries from one person to another an interest in land.

CORNER INFLUENCE
The added desirability or utility of a property due to its frontage to two streets, which provides better ventilation for residential purposes easier accessibility and more commercial displays for commercial and industrial utilization.

CORPORATION
A group of body of persons established and treated by laws as an individual or unit with rights and liabilities of both distinct and apart from those of the persons composing it. A corporation is a creature of law having certain powers and duties of a natural person . Being created by law, it may continue for an length of time the law prescribes.

COVENANT
Agreement written into deeds and other instruments promising performance or non-performance of certain acts or stipulating certain uses or non-use of the property.

CUL DE SAC
A passageway with one outlet; a blind alley.

CURTAIL SCHEDULE
A listing of the amounts by which the principal sum of an obligation is to be reduced by partial payments and of the dates when each payment will become payable.

DAMAGES
The indemnity recoverable by a person who has sustained an injury either in his person, property, or relative rights through the act or default of another.

DEED
A written instrument which, when properly executed and delivered conveys title.

DEFAULT
The failure to fulfill a duty or promise or to discharge an obligation: an omission or failure to perform any act.

DEFEASANCE CLAUSE
The clause in a mortgage that gives the mortgagor the right to redeem his property upon the payment of his obligations to the mortgagee.

DEFICIENCY JUDGMENT
A judgment given when the security pledge for a loan does not satisfy the debt upon its default.

DEPRECIATION
The loss of value in real property brought about by age, physical deterioration for functional or economic obsolescence. Broadly, a loss in value from any cause.

DEVISOR
One who receives a bequest made by a will.

DIRECTIONAL GROWTH
The location or direction toward which the residential sections of a city are destined or determined to grow.

EASEMENT
Created by grant or agreement for a specific purpose, an easement is the right, privilege, or interest which one party has in the land of another. (Example: right of way).

ECONOMIC LIFE
The period over which a property will yield a return on the investment, over and above the economic or ground rent to land.

ECONOMIC RENT
The potential rent which a property can command, considering rental of similar or comparable properties in the neighborhood.

EMINENT DOMAIN
The right of the government to acquire property for necessary public or quasi-public use by condemnation.

ENCROACHMENT
Trespass; the building of a structure or construction of any improvements partly or wholly on the property of another.

ENCUMBRANCE
Anything which affects or limits the fee simple title to property such as mortgages, easements, or restrictions of any kind. Liens are money encumbrances which make the property security for the payment of a debt or obligations, such as mortgages and taxes.

EQUITY
The interest or value which an owner has in real estate over and above the liens against it.

EQUITY OF REDEMPTION
The right to redeem property during the foreclosure period, such as a mortgagor’s right to redeem within a year after foreclosure sale.

EROSION
The wearing away of land by the action of water, wing or glacial ice.

ESCALATION CLAUSE
A in a contract providing for the upward or downward adjustment of certain items to cover specified contingencies.

ESCROW
The deposit of instrument and funds with instructions to a third neutral party to carry out the provisions of an agreement or contract; when everything is deposited to enable carrying out the instructions, it is called a complete or perfect escrow.

ESCHEAT
The reverting of property to the estate when heirs capable of inheriting are lacking.

ESTATE
As applied to the real estate practice the term signifies the quantity of interest, share, right, equity or which riches or fortune may consist, in real property. The degree, quantity, nature and extent of interest which a person has in real property.

ETHICS
That a branch of moral science, idealism, justness, and fairness which treats of the duties that a member of profession or crafts owes to the public, to his clients or patron and to his professional brethren or members.

EXCLUSIVE RIGHT-TO-SELL LISTING
A written agreement between an owner and an agent giving the agent the right to collect a commission if the property is sold by anyone during the term of his agreement.

EXECUTE
To complete, to make, to do, to follow out. To execute a deed is to make a deed, including specially signing, sealing and delivering. To execute a contract is to perform the contract, to follow out to the end, to complete.

EXECUTOR
A person named in a will to carry out provisions as to the disposition of the estate of a person deceased.

FAIR MARKET VALUE
The price at which a willing seller will sell and willing buyer will buy neither being under abnormal pressure.

FEE MARKET VALUE
The price at which a willing seller will sell and willing buyer will buy neither being under abnormal pressure.

FEE SIMPLE
In modern estates, the term “Fee” and “Fee Simple” are substantially synonymous. The term “Fee” is of Old English derivation. “Fee Simple Absolute” is an estate in real property, by which the owner has the greatest power over the title which it is possible to have being an absolute estate. In modern use, it is expressly establishes the title of real property in the owner, without limitations or end. He may dispose of it by sale or trade or will as he chooses.

FIDUCIARY
A person in a position of trust and confidence as between a principal and a broker as fiduciary owes a certain loyalty which cannot to breached under rules of agency.

FIXTURES
Appurtenance attached to the land or improvements which usually cannot be removed without agreement as they become real property. Examples, plumbing fixtures, store fixtures built into the property, etc.

FORECLOSURE
A procedure whereby property pledged as security for a debt is sold to pay the debt in the event of default in payments or terms.

FORFEITURE
The loss of money or anything of value, due to failure to perform such as under an agreement to purchase.

FRAUD
The intentional and successful employment of any cunning, deception, collusion or artifice used to circumvent, cheat, or deceive another person whereby that person acts upon it to the loss of his property and to his legal injury.

GIFT DEED
A deed for which the consideration is love and affection and where there is no material consideration.

GRANT
A technical term made use of in deed of conveyance of lands to import a transfer.

GRANTEE
The purchaser: a person to whom a grant is made.

GRANTOR
The seller of property: one who signs the deed.

GROSS INCOME
Total income from property before any expenses are deducted.

GROUND RENT
Earnings of improve property credited to the earnings of the ground itself after allowances is made for earning of improvements; often termed economic rent.

HIGHEST AND BEST USE PRINCIPLE OF
The use which will bring the optimum or highest returns or advantage as a of a certain time.

HOLD-OVER-CLAUSE
A provision in listing agreement which entitles the broker to commission even when he closed the sale after the period of the authority provided that the buyer was registered by him with the seller and with whom he has negotiated during the period of his authority.

HYPOTHECATE
To give a thing as security without the necessity of giving up possession of it.

INCOMPETENT
One who is mentally incompetent, incapable, any person who is not insane, but by the reason of old age, disease or weakness of mind, or any other cause, is unable, if unassisted to manage properly and take care of himself or his property or by reason thereof would likely be deceive or imposed upon by artful or designing persons.

INCREASING AND DIMINISHING RETURNS, PRINCIPAL OF
States that the application of more factors of productions will tend to increase net income up to a certain point beyond which the application of more factors of production will tend to diminish net income.

INJUNCTION
A writ or order issued under the seal of a court to restrain one or more parties to a suite or proceeding from doing an act which deemed to be inequitable or unjust in regard to the rights of some other party or parties in the suit or proceeding.

INSTALLMENT NOTE
A note which provides that payments of a certain sum or amount be paid on the dates specified in the instrument.

INSTRUMENT
A written legal documents created to affect the rights of the parties.

INTEREST RATE
The percentage of a sum of money charged for its use.

INTESTATE
A person who dies having made no will, or having made a will is defective in form in which case his estate descends to his heir at law or next of kin.

INVOLUNTARY LIEN
A lien imposed against property without the consent of an owner; example: taxes, special assessments, income tax liens, etc.

IRREVOCABLE
Incapable of being recalled or revoked: unchangeable.

JOINT NOTE
A note signed by two or more persons who have equal liability for payment.

JOINT TENANCY
Joint ownership by two or more persons with the right of survivorship; all joint tenants own equal interest and have equal rights in the property.

JUDGMENT
The final determination of a court of competent jurisdiction of a matter presented to it; money judgments provide for the payment of claims presented to the court, or awarded as damages, etc.

JURISDICTION
The authority by which judicial officers take cognizance of and decide cause; the right and power which a judicial officer has to enter upon the inquiry.

KEY-LOT
A lot adjoining a corner, at right angle to it, and fronting an intersecting street.

LACHES
Delay or negligence in asserting one’s legal rights.

LAND CONTRACT
A contract ordinarily used in connection with the sale of property in cases where the seller does not wish to convey title until all or a certain part of the purchase price it paid by the buyer; often used when property is sold on a small downpayment.

LANDS, TENEMENTS AND HEREDITAMENTS
A phrase used in the early English law to express all sorts of property of the immovable class. Its present use may be said to express real estate with all fixed improvement thereon, if any.

LEASE
A contract between an owner and a tenant, setting forth conditions upon which the tenant may occupy and use the property and the term of the occupancy.

LEGAL DESCRIPTION
A description by which property can be definitely located by reference to government surveys or approved recorded maps.

LESSEE
One who contract to rent property under a lease contract.

LESSOR
An owner who enters into a lease with a tenant.

LEVERAGE
The use of downpayment to secure an interest in an investment. An example of high leverage be a P1,000.00 downpayment on a P100,000.00 property. If the property goes up in price to P105,000 over a short period of time, the investor will make a 500 percent profit. If the price drops to P99,000.00, the investor loses everything. The higher the leverage, the higher the risk.

LIEN
A form of money encumbrance which usually make property security for the payment of a debt or discharge of an obligation. Example: judgments, taxes, mortgages, deeds of trust, etc..

MARGINAL LAND
Land which barely pays the cost of working or using.

MARKETABLE TITLE
A merchantable title: a title free and clear of objectionable liens and encumbrances.

MARKET PRICE
The price paid regardless of pressures, motives, intelligence.

MARKET VALUE
(1) The price at which a willing seller would sell and a willing buyer would buy, neither being under abnormal pressure; (2) As defined by the courts it is the highest price estimated in terms of money which a property will being if exposed for sale in the open market allowing a reasonable time to find a purchaser with knowledge of the property’s use and capabilities for use.

MATERIAL FACT
A fact is material if it is one which the agent should have realized would be likely to affect the judgment of the principal in giving his consent to the agent to enter into the particular transaction on the specified terms.

MECHANICS LIEN
A lien created by law which exists in favor of persons who have performed services or furnished materials in the erection or repair of a building.

METER AND BOUNDS
Measurements and boundaries.  A term in describing the boundary lines of land, setting forth all the boundary lines, together with their terminal points and angles.

MONUMENT
A fixed object and point establishment by surveyors to establish land locations.

MORATORIUM
The temporary suspension, usually by status of the enforcement of liability for debts.

MORTGAGE
An instrument recognized by law by which property is hypothecated to secure the payment of a debt or obligation; the procedure for foreclosure in the vent of default establishment by statute.

MORTGAGEE
One to whom a mortgagor gives a mortgage to secure a loan or or performance of an obligation; a lender.

MORTGAGOR
One who give a mortgage on  his property to secure a loan or assure performance of an obligation; a barrower.

MULTIPLE LISTING
A listing, usually an exclusive right to sell, taken by a member of an organization composed of real estate brokers, with the provisions that all members will have the opportunity to find an interested client; a corporate listing.

Real estate tax is levied on Philippine real property and the applicable rate varies depending on the location. The maximum rate that a city or municipality within Metro Manila may impose is 1% while cities and municipalities outside Metro Manila may levy the tax at the rate not exceeding 2%. The owner has the option to pay the tax in four equal installments on or before the last day of each calendar quarter.

Calculating the Property’s Assessed Value
The tax is levied on the property’s assessed value (which is a prescribed percentage of current fair market value depending on actual use and zoning of property). In computing for the taxable value, the property’s fair market value is determined and the assessment percentage is then applied. The resulting amount is the tax base where the real estate tax rate is applied.

Property owners are required to file a sworn statement declaring the true (current and fair market value) of their property once every three years. The filing period is from 01 January to 30 June annually.

Source: Global Property Guide

But as recent as two years ago, a great number of overseas Filipino workers (OFWs) who have worked abroad for more than 20 years still have to own a home.

This was the sad reality that Melesa (Elsie) Chua, president and chief executive officer of CDC Holdings, Inc. sought to address when she traveled on a trade mission to the Gulf Cooperation Council (GCC) countries in the Middle East sometime in 2007 to offer her compatriots some properties.

Recalls Elsie: “What made the work initially difficult was not that the OFWs did not want to buy [property], but that they did not have confidence in the country and had no plans for reintegration in Philippine society once their contracts expired.”

The challenge then, she adds, “was not so much in selling homes and properties, but in orienting OFWs to believe in the Philippines again, and teaching them to save and invest.”

This lack of foresight in purchasing a home, it turned out, “can be attributed to the misconception that properties such as houses and lots or condominiums are not within their budget,” Elsie explains.

It was a concern that the company addressed immediately with development projects suitable to these OFWs’ budget.

Elsie also disclosed that aside from budget constraints, most OFWs have been traumatized over past experiences or stories about being defrauded of their deposits or down payments by unscrupulous real estate companies.” Once the initial reservation fee was paid, nothing more was heard from the developer. There was no follow-through at all.”

There are several factors that OFWs should consider before they buy a condo unit, advise Elsie and her daughter, CDC Sales & Marketing Head Charlene D. Chua. Here are a few of them:

1. Location, location, location. Proximity to schools, the workplace, the market and medical facilities should be of prime importance. Consider also accessibility to main roads, or at least to major transportation routes. And, of course, based on recent events, it must be within a flood-free area.

2. Pricing and terms. The unit should be affordable and have a flexible payment scheme. Find out the cost per square meter, and how long it would take to finish paying the property. Are there any hidden charges? Are there balloon payments that surface after a year? Sometimes all these are indicated only in the fine print of the contract after the buyer has already paid the reservation fees and down payment.

Find out about arrangements for payments made directly to the developer. So many problems could crop up when other parties handle the payment. Many developers have special offices abroad to receive payments directly from OFWs.

3. Financing assistance. Know your options and which financing scheme is suited to your capability. Pag-ibig still has the best interest rates over all other banks.

4. Understand the specifications of materials, design and finish as committed by the developer. Does the model unit reflect the specifications or have these been enhanced for sales purposes? You will need these data for better assessment during the turn-over. Sometimes, the actual unit delivered does not match the model unit.

5. Credibility and commitment of the developer. Check out the track record of the developer. Sometimes what’s been promised in advertisements is not what is delivered.

Ask about the turn-over date and commitment of the developer. A five-year-turnover schedule is way too long, says Elsie. Full completion should be achieved within three years.

6. Facilities and amenities. When buying a condo, look beyond the unit itself. What comes with the package? Check out the landscaping and other facilities like water reservoirs, generators, pools, and parking areas. Be especially vigilant about drainage. Is the area flood-prone?

7. Sound property management. After-sales service should be part of the commitment of being your investment partner. Most OFWs don’t get to come home as often as they want. It is thus important for the developer to have sound property management. Find a developer who will provide adequate assistance even after you’ve paid your reservation and other fees.

Know the maintenance scheme of the community or the property you intend to buy. For instance, how does the property manager keep common areas clean? How does she or he deal with garbage collection?

8. Safe and secure community. Know the security measures that the developer has in place. Does management have the capacity to implement those measures? It all goes back to track record.

9. Eco-friendly community. Does the property developer or manager contribute significantly to decreasing the carbon footprint of its residents? Does the property have elevated water tanks, and cisterns that store rain water so it can be recycled and reused to water plants, and clean facilities and cars?

10. Personal touch. Being an investor means you are a business partner of the developer who should have enough passion for the project. The developer should be approachable enough to address individual concerns from buyers and thus have the capability to make them feel good all the way. •

Source: Inquirer