I bought a lot but the developer said they are having issues with title transfers. Why?

This is is a message from a good friend who bought land only properties in the Visayas. She and her husband bought a property and paid in installment for 5 years. Now that they have finished paying for it already, the developer said that they are having problems transferring the titles to them. Now she’s crying for help.

Purchasing a property is a pride for almost all hardworking men and women in this world. To some having one is a sign of success, the fruit of hard work and labor. Thus, it’s best to guard your investments like how you guard your own life.

What did we find out?

  • The property is still in its MOTHER TITLE and hasn’t been transferred to the heirs yet.
  • The heirs weren’t able to settle the estate taxes yet.
  • Although the lot has been subdivided, it was not registered and was never applied for a license to sell (LTS) at HLURB (Housing Land Use Regulatory Board). In short, NO LTS
  • The property is an agricultural land and not yet ready for reclassification to residential use.

Which Means;

Mother Title and the title is not yet transferred to the heirs.

This simply means they haven’t filed for transfer yet and not all of the heirs are present to sign and agree to the sale. If ever you purchase one without the consent of everybody else, the purchase will be invalid and the siblings and other heirs can contest the sale and claim the lot back to the original owners.

Estate Taxes are not yet paid by the heirs.

Which means the title is not yet transferred to the heirs. Real Estate tax and estate tax are different, although they sound the same. Estate Tax is taxes paid to the government every time an owner of the property and/or heirs dies. It totals all the properties owned by the person and the heirs will have to pay for it. That’s approximately 6% of the total land holdings and other properties, wealth owned by the deceased. While the real estate tax is the taxes paid yearly for the existing property owned.

A lot of people fails to transfer the titles from the deceased thinking it’s okay as long as they are paying the real estate tax yearly. What they don’t know is that delaying the payment or filing of the estate tax can lead to the dissolution of their ownership. Read more about Estate Taxes here.

No LTS.

One of the disadvantages of buying a lot without subdivision plans and license to sell is, HLURB and the government cannot help you guard your investment and property. If the developer decides to discontinue the project and not complete the subdivision or community as what promised, the government cannot help you fight to claim your rights such as a refund. Read more about License to Sell and why you need to look for it. 

The Property is an Agri land and not a residential lot.

Agri lots are meant for agriculture. You cannot build a house or construct a building in an agricultural lot. You also cannot file or apply for installation of utilities to an agricultural lot like water and electricity.

Yuta-data-data as what it is known for are not all illegal. There are some that are legit but many of this are an absolute scam. Because of the hype of real estate today, many were encouraged to invest and get one. Most of the time the people will always look for bigger lots at a much lower price. Read more about Agri land conversion to Residential land here. 

I hope this article guides you in your real estate investment journey. For legal concerns, please contact a real estate lawyer directly for proper guidance.

Xy-Za Yape is a founding member and a blogger of Filipino Homes. She is also a PRC and HLURB Registered Real Estate Professional and a Licensed Financial and Investment Advisor. She is a Hubspot certified in Inbound Marketing. She is also the co-founder of Iligan Bloggers Society, Inc.