Q. HI Atty: I reserved for a 2 BR condominium unit in QC with total TCP of around Php3million. I paid the reservation fee of 10k in Nov 2013 and started paying the 20% DP last Dec 2013 to present of 31,270 per month.
I paid for 6 months already or nearly Php197,620. And then after analyzing my capabilities, I think I can no longer continue paying for this. Please let me know what are my remedies to get my money back. Thanks. RR
ANS: Greetings. As this representation is not privy to your transactions with the Condominium developer, it is strongly suggested that you carefully peruse the following documents, as regards to your queries:
Reservation agreement
Contract to Sell.
You see in civil law transactions, the rights of the contracting parties(seller and buyer) is governed by the contract/agreement that the parties entered into. Unless the terms of the contract is contrary to law, moral and public policy, then the law takes over defining the respective rights of the seller and the buyer .
Further to above, under the so called Maceda Law, or Republic Act No. 6552 , for your ready reference, hereunder are the rights of Real Estate buyers who purchased real estate properties in installments and who defaulted in the payment of the installments due :
“ SEC. 3. In all transactions or contracts involving the sale financing of real estate on installment payments, including residential condominium apartments but excluding industrial, commercial building and sales to tenants under Republic Numbered Thirty Eight Hundred forty- as amended by Republic Act Numbered Sixty-three hundred eighty nine, where the buyer has paid at least two years of installments, the buyer, is entitled to the following rights in case he defaults in the payments of succeeding installments:
(a) To pay, without additional interest, the unpaid installments due within the total grace period earned by him which is hereby fixed at the rate of one month grace period for every one year of installment payments made: Provided, That this right this right shall be exercised by the buyer only once in every five years of life of the contract and its extensions, if any.
(b) If the contract is cancelled, the seller shall refund to the buyer the cash surrender value of the payments on the property equivalent to fifty per cent of the total payments made and, after five years of installments , an additional five per cent every year but not to exceed ninety percent of the total payment made: Provided, That the actual cancellation of the contract shall take place after thirty days from receipt by the buyer ( the notice of cancellation or the demand for rescission of the contract by a notarial act and upon full payment of the cash surrender value to the buyer. Down payments, deposits or options on the contract shall be included in the computation of the total number of installment payments made.
SEC. 4. In case where less than two years of the installment were paid, the seller shall give the buyer a grace period of not less than sixty days from the date the installment became due. If the buyer fails to pay the installments due at the expiration of the grace period, the seller may cancel the contract after thirty days from receipt by the buyer of the notice of cancellation – or the demand for rescission of the contract by a notarial act. “
However, kindly take notice that the above–quoted provisions may not be applicable to you as the protection of the Maceda law is ONLY applicable in the event where the buyer defaulted in the payments of installments and as a consequence the developer cancelled the contract .
With regard to your present situation ,what is clear in your email is the fact that after six months of paying you realized that you can no longer afford to continue paying the amortization. Thus, if you are not yet in default status and the contract to sell has not been cancelled by the developer, the above-provision may not be applicable to you.
In the light of the foregoing, hereunder are the suggested remedies/options that you could explore: 1) Go over the reservation agreement and the contract to sell that you have signed and find out whether or not you are entitled to certain refund should you intend to cancel the reservation agreement or the contract to sell; 2) Sell your rights of the condo unit to other buyers. Transferring or selling condo unit although not paid in full is a right of condo buyers as provided under Sec. 5 of the Maceda law; and finally,
3) If you find the terms of the reservation agreement or contract to sell grossly unconscionable or contrary to the Maceda law, you may file a complaint or seek assistance from the Housing and Land Use Regulatory Board( HLURB) .
This government agency has the exclusive original jurisdiction concerning issues concerning condominium and subdivisions projects and transactions.
Thank you for writing and for being part of the “Batas Pinoy Global Community”.
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