Date: September 16, 2024
The process of transferring ownership of real estate, whether it be land or condominium units, from a seller to a buyer involves a series of detailed legal steps. This guide aims to provide a clear overview of these steps in the context of Manila's real estate scene in 2024, reflecting the latest regulatory conditions and market practices.
Transferring property titles is a crucial step in the buying and selling of real estate in Manila. It legally shifts the ownership from the current registered owner (seller) to the new owner (buyer). This process is governed by specific legal requirements that ensure the legitimacy and legality of the ownership transfer. Understanding why and how these transfers occur is essential for any party involved in real estate transactions in Manila.
1. Understanding the Need for Title Transfer
The certificate of title, whether an original title or an owner's duplicate copy, stands as the primary evidence of property ownership. It is essential for validating transactions such as sales, mortgages, or any legal claim against the property. Without transferring the title to the new owner's name, the legal standing of ownership remains with the original owner, making it impossible for the new owner to engage in future transactions or defend against ownership claims.
2. Execution of a Deed of Conveyance
The first step in transferring property titles is the execution of a deed of conveyance, such as a Deed of Absolute Sale (DOAS). This legal document must clearly state that the seller agrees to transfer ownership to the buyer, who in turn has fulfilled the payment obligations. This deed must be notarized to have any legal effect, which involves signing the document before a Notary Public to affirm its authenticity.
3. Payment of Necessary Taxes and Fees at the Bureau of Internal Revenue (BIR)
Following the notarization, the next step involves settling applicable taxes at the BIR. The required documents typically include a certified true copy of the title, the latest tax declaration, and the original deed of sale. The seller is responsible for the Capital Gains Tax (CGT), calculated at 6% of the higher value between the actual purchase price and the zonal valuation. Additionally, both parties must cover the Documentary Stamp Tax (DST) set at 1.5% of the same valuation basis. Once these taxes are settled, the BIR issues a Certificate Authorizing Registration (CAR), permitting the continuation of the registration process.
4. Payment of Transfer Tax
The buyer must then address the transfer tax, which varies from 0.0075% to 1% of the property's value, payable at the city or municipal hall where the property is located. This tax must be cleared to obtain a tax clearance certificate and an official receipt, which are crucial for the final steps of the title transfer.
5. Registration of the Title Transfer
The final legal step takes place at the Register of Deeds, where the property is located. The buyer must submit the owner's duplicate copy of the title, the deed of sale, a certified true copy of the latest tax declaration, and the CAR. A corresponding registration fee must be paid for the issuance of a new title under the buyer's name, officially completing the transfer process.
The process of transferring land or condominium titles in Manila requires meticulous attention to legal details and strict adherence to regulatory requirements. While straightforward in outline, each step can involve complexities depending on the specific circumstances of the property and the parties involved. For those new to real estate transactions or those without legal expertise, consulting with real estate professionals such as those at BedandGo Real Estate can provide necessary guidance and assurance, ensuring that all aspects of the title transfer are handled accurately and efficiently in 2024's dynamic real estate environment. This meticulous approach not only secures your investment but also reinforces the integrity and stability of property ownership in Manila.
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