Frequently Asked Questions
Q. What are the procedures of transfer of ownerships of properties.
- When you decide to buy a certain property, you must first make sure that the Title is clean- free from all liens, encumbrances, or annotations. This is done by getting a Certified True Copy of the Title from the Register of Deeds.
- The normal sharing of expenses between the buyer and the seller when transferring the real estate property title (TCT or Transfer Certificate of Title) to a new owner is as follows:
The Seller shoulders the:
Capital Gains Tax (6% of the contract price)
And all other unpaid taxes due.
Pays the Agent / Broker's commission (usually 3 to 5% of the selling price).
The Buyer Pays for the:
Documentary Stamp Tax - 1.5% of the contract price, or zonal value or fair market value, whichever is higher.
Transfer Tax - 0.5% of the contract price, or zonal value or fair market value, whichever is higher.
Registration Fee - 0.25% of the contract price, or zonal value or fair market value, whichever is higher.
The above sharing of expenses is the standard practice in the Philippines . However, buyers and sellers can mutually agree on other terms as long as it is done during the negotiation period (before the signing of the "Deed of Sale").
- Sellers would usually require the buyers to make an earnest money as reservation, so as to hold the property for a certain period of time. The Seller may also require the buyers to make a down payment, as part of the total contract price, in which case, the Seller and the Buyer must sign a Deed of Conditional Sale for the latter.
- The "Deed of Sale" is the document showing legal transfer of real estate property ownership. The deed of sale is then taken to the Registry of Deeds to be officially recorded. Your Agent / Broker will usually do the registration process without any additional payments (aside from the commission).
Documents needed for the Transfer of Certificate of Title (TCT):
Copies of the Deed of Absolute Sale
Latest tax declaration of the property
Certificate from the Bureau of Internal Revenue that the capital gains tax and documentary stamps have been paid
Receipt of payment of the transfer and registration fees
Download a Free Printout of Steps Here docx format
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See Requirements for OFWs Here OFW Requirements for Real Estate Buyers in the Philippines
Note: Prices and steps may vary from area to area