Group 2 Flashcards
- What is the main purpose of PD 957?
A. To regulate commercial real estate transactions
B. To protect buyers from unscrupulous developers and sellers
C. To increase government revenue from real estate sales
D. To encourage foreign investment in real estate
B. To protect buyers from unscrupulous developers and sellers
- Under PD 957, how long does a developer have to complete the promised facilities and infrastructure?
A. Within six months of project registration
B. Within one year of the project’s license issuance or within an approved period
C. Within five years of project completion
D. Within two years after selling 50% of the units
B. Within one year of the project’s license issuance or within an approved period
- Before selling subdivision lots or condominium units, developers must first secure a ______ from DHSUD.
A. Certificate of Ownership
B. Deed of Sale
C. License to Sell
D. Business Permit
C. License to Sell
NOTE: DHSUD=Department of Human Settlements and Urban Development
- What happens if a buyer stops installment payments due to a developer’s failure to complete the project?
A. The payments made by the buyer will be forfeited.
B. The buyer may demand a refund with interest at the legal rate.
C. The buyer must continue paying to avoid penalties.
D. The developer will be exempted from liability.
B. The buyer may demand a refund with interest at the legal rate.
- According to PD 957, when should the title be transferred to the buyer?
A. Upon full payment, with no extra fees except registration costs
B. After the buyer completes a five-year residency
C. Once 80% of the subdivision or condominium project is sold
D. When the developer decides it is convenient
A. Upon full payment, with no extra fees except registration costs
- What law governs the rights of buyers who fail to pay installment payments?
A. Civil Code of the Philippines
B. Maceda Law (RA 6552)
C. Urban Development Act
D. Housing and Land Use Regulatory Act
B. Maceda Law (RA 6552)
- Under PD 957, who is responsible for paying real estate taxes before the title is transferred?
A. The buyer
B. The seller and buyer share the taxes equally
C. The developer
D. The local government
C. The developer
- What is the effect of a waiver clause in a contract that exempts the developer from complying with PD 957?
A. It is valid if both parties agree.
B. It is null and void.
C. It can be enforced in court.
D. The developer can demand additional payments.
B. It is null and void.
- If a buyer occupies the property before the title transfer, when do they start paying real estate taxes?
A. Immediately upon move-in
B. The following year after moving in
C. After the developer completes all amenities
D. Once 75% of the units are occupied
B. The following year after moving in
- What law complements PD 957 by governing condominium ownership?
A. Urban Housing Act
B. Maceda Law
C. The Condominium Act (RA 4726)
D. Real Estate Taxation Law
C. The Condominium Act (RA 4726)
- What is the primary objective of the Recto Law?
A. To allow sellers to impose multiple penalties on buyers
B. To regulate the sale of real estate properties
C. To prevent sellers from abusing buyers in installment sales
D. To allow buyers to avoid paying for purchased items
C. To prevent sellers from abusing buyers in installment sales
- Which of the following is NOT a remedy available to the seller under the Recto Law?
A. Exact fulfillment of the obligation
B. Cancelling the sale after one missed installment
C. Foreclosing the chattel mortgage
D. Cancelling the sale after two missed installments
B. Cancelling the sale after one missed installment
- Under Article 1484, what happens if the seller chooses foreclosure of a chattel mortgage?
A. The seller can still sue for the unpaid balance
B. The seller cannot pursue the buyer for any remaining balance
C. The buyer must pay the full price before repossession
D. The contract is automatically voided
B. The seller cannot pursue the buyer for any remaining balance
- What law governs installment sales of personal property in the Philippines?
A. Maceda Law
B. Recto Law
C. Civil Code of 1889
D. Consumer Protection Act
B. Recto Law
- What is the scope of the Recto Law?
A. Sales of real estate properties
B. Installment sales of personal property
C. All forms of contracts and agreements
D. Transactions with lump-sum payments
B. Installment sales of personal property
- Which article in the Civil Code replaced Section 1454-A and contains the Recto Law?
A. Article 1485
B. Article 1484
C. Article 1486
D. Article 1454
B. Article 1484
- What happens if a lease contract includes an option to buy and the lessor deprives the lessee of the property?
A. The lease contract is terminated without penalty
B. Article 1484 rules on installment sales apply
C. The lessee automatically owns the property
D. The seller can sue for the remaining balance
B. Article 1484 rules on installment sales apply
- Which of the following statements about deficiency claims is TRUE under the Recto Law?
A. The seller can claim a deficiency if foreclosure proceeds are insufficient
B. Deficiency claims are allowed only for real property
C. Deficiency claims are prohibited after foreclosure
D. Buyers must always pay the full balance regardless of foreclosure
C. Deficiency claims are prohibited after foreclosure
- What does Article 1486 state regarding forfeiture of installments or rent paid?
A. It is always allowed without restriction
B. It is valid unless deemed unconscionable
C. It is never permitted under any circumstance
D. The buyer must return the property before forfeiture applies
B. It is valid unless deemed unconscionable
- Why was Article 1485 included in the Civil Code?
A. To ensure that sellers do not disguise installment sales as lease contracts
B. To allow sellers to impose additional penalties on buyers
C. To regulate the sale of government properties
D. To prevent buyers from defaulting on their payments
A. To ensure that sellers do not disguise installment sales as lease contracts
- What is another name for the Maceda Law?
a) Installment Sales Protection Act
b) Realty Installment Buyer Protection Act
c) Property Installment Agreement Act
d) Homebuyers’ Protection Law
b) Realty Installment Buyer Protection Act
- Who authored the Maceda Law?
a) Claro M. Recto
b) Ernesto Maceda
c) Ferdinand Marcos
d) Jose P. Laurel
b) Ernesto Maceda
- The Maceda Law applies to which type of property?
a) Personal property
b) Real estate used for residential purposes
c) Commercial property
d) Industrial buildings
b) Real estate used for residential purposes
- Which of the following is NOT covered under the Maceda Law?
a) House and lot purchased in installments
b) Condominium units bought under installment payments
c) Subdivision lots purchased through installment
d) Agricultural land
d) Agricultural land
- What is the maximum refundable amount a buyer can receive under Maceda Law?
a) 50%
b) 75%
c) 90%
d) 100%
c) 90%
- What is a key difference between the Recto Law and Maceda Law?
a) Recto Law applies to personal property, Maceda Law applies to real estate
b) Recto Law applies to real estate, while Maceda Law applies to installment sales
c) Recto Law covers real estate, Maceda Law covers personal property
d) Both laws apply to all installment sales
a) Recto Law applies to personal property, Maceda Law applies to real estate
- If a buyer has paid less than two years of installments, how many days are given as a grace period to pay overdue payments?
a) 30 days
b) 60 days
c) 90 days
d) 120 days
b) 60 days
- Under the Maceda Law, how much refund is required for buyers who have paid less than two years of installments?
a) 0
b) 25%
c) 50%
d) 100%
a) 0
- What is the main purpose of the Maceda Law?
a) Protect buyers of residential real estate under installment payments
b) Provide additional profits for developers
c) Ensure tax compliance for real estate transactions
d) Enforce commercial property installment regulations
a) Protect buyers of residential real estate under installment payments
- Maceda Law was created mainly to protect:
a) Wealthy investors
b) Low- and middle-income home buyers
c) Commercial developers
d) Foreign buyers of Philippine property
b) Low- and middle-income home buyers
The law that regulates the sale of subdivision lots and condominium units and imposes penalties for violations.
PD 957
The law that governs the sale and ownership of condominium units, ensuring that developers meet their obligations and protecting buyers from exploitation.
RA 4726 / Condominium Act
It provides a grace period for buyers to settle their arrears and avoid losing their property.
Maceda Law
Presidential Decree No. 957 was issued by _____
President Ferdinand Marcos
The legal document that a developer must secure before selling subdivision lots and condominium units.
License to Sell
The obligation of developers to transfer to buyers after full payment, with no extra fees except registration costs.
Delivery of Title
What law governs the installment sales of personal property in the Philippines?
Recto Law
Who was the senator responsible for enacting the Installment Sales Law in 1933?
Senator Claro M. Recto
Which article in the Civil Code contains the Recto Law?
Article 1484
What is the legal term for the seller’s right to take back the property if the buyer fails to pay two or more installments?
Cancellation of sale
What remedy prohibits the seller from pursuing the buyer for any deficiency after repossessing and selling the property?
Foreclosure of chattel mortgage
Which article in the Civil Code extends the application of Article 1484 to lease contracts with an option to buy?
Article 1485
What principle prevents a seller from choosing multiple remedies under the Recto Law?
Seller’s obligation to elect a remedy
The law that protects real estate buyers in installment sales.
Maceda Law
The full name of the Maceda Law.
Realty Installment Buyer Protection Act
The minimum refund percentage under Maceda Law.
50%
The required notice period before cancellation.
30 days
The maximum refundable percentage under Maceda Law.
90%
The minimum grace period per year of payment under Maceda Law.
1 month per year of payments
The senator who authored the Maceda Law.
Senator Ernesto Maceda
Scope of PD 957
- Subdivision lots
- Condominium units
Two laws that regulate subdivision and condominium sales
- PD 957
- Condominium Act / RA 4726
Remedies of Vendor in Sale of Personal Property
- Exact fulfillment of the obligation
- Cancel the sale
- Foreclose the chattel mortgage
Scope and Coverage of Recto Law
- Personal Property
- Installment Sales
Two types of properties NOT covered by Maceda Law
- Industrial properties or Commercial properties
- Sales financed through banks or other financial institutions
Two key benefits of the Maceda Law to buyers
- Protects installment buyers from unfair contract cancellations
- Ensures buyers receive a fair refund of their payments
2 Key provisions under Maceda Law
- Rights of buyers who have paid at least 2 years
- Rights of buyers who have paid less than 2 years
