Professional Documents
Culture Documents
If you are planning to sell your real estate property in the Philippines, you need to follow the correct procedures to avoid putting yourself
into a nightmarish situation. While it does not take rocket science to sell a property, familiarizing yourself with the procedures is a must
as there are some legal documents that you need to secure.
1. Sign A Contract of Agreement
The owner or broker will first discuss the terms of the sale, the commission and the fees. It is also necessary to scrutinize the
documents to make sure that the land title meets the condition and free from encumbrances, liens and loans.
2. Issue an Authority to Sell
The purpose of the agreement or contract is to bind the broker as the agent of the owner providing the essential information and the
amount of commission of the property that will be sold. The contract will also indicate if the owner will bestow upon the exclusive rights
of the broker or a non-exclusive authorization to sell the property. The broker will secure the necessary documents before selling the
property to ensure that there are no problems concerning the property. The broker will also check if the property is free from
encumbrances. An encumbrance means that another person has interest in, right to, or legal liability on the property that either deter
the process of transferring the title or diminish the value of the property.
3. Assessment of property by the broker
The broker will check the property as a way of assessing its current market value. It is important for the property to be appraised to
determine its actual price. There are several factors that will be taken into account in determining the asset's value such as the area
and location of the property.
4. Broker will offer and sell the property
Before a broker can market the property, it is important that the owner agrees on how to market the property. There are also some
limitations that should be taken into consideration such as privacy when releasing photos or disclosing the location online. Both parties
must also decide on how to split the marketing costs such as communication and transportation expenses. Nowadays, the common
practice is that the broker shoulders the expenses depend on the amount of the commission.
5. Viewing of the Property
Once the buyers get in touch with the broker or owner, they will proceed with viewing the property. The owner needs to make sure that
the property is presentable to add value to the property.
6. Write a Letter of Intent or Offer to Buy
The buyer will also offer a Letter of Intent to the property owner declaring the intention to purchase. More often than not, the Letter of
Intent is given at the first stage in documenting a sale of real property.
7. Acceptance of Owner
The owner accepts the Letter of Intent once signed. This indicates acceptance of the terms given by the buyer. Upon acceptance, the
seller will be bound to promise not to offer the property to other buyers so long as the buyer does not breach the conditions in the letter.
8. Provide Earnest Money
The earnest money is provided as means of holding the property subject to the buyer's due diligence. It can be forfeited when there is
default on the buyer's part. The money can also be used as refundable subject to deductions depending on the agreement that both
parties made.
9. Preparation of Legal Documents
The legal documents must be secured in preparation of the transfer of ownership to the buyer.
The owner or broker must procure these documents from the Assessor's Office:
• Certified True Copy of Tax Declaration ( Land )
• Certified True Copy of Tax Declaration ( Improvement / Building )
• Certified True Copy of Tax Declaration ( Condominium )
• Certified True Copy of Tax Declaration ( Condominium parking, if applicable )
• Real Estate Tax Clearance for Current Year
• Certificate of Non-Improvement if property is bare and without structures such as a house or a building