Philippine Real Estate Law - Donation or Sale ?

 
Robert G. Sarmiento Properties
Professional Affiliation :
Philippine Association of Real Estate Boards
Member, City of Taguig Real Estate Board 2016 - 2019
Real Estate Broker’s Association of the Philippines 2000 - 2015
President, San Juan 2008, 2009
Philippine Association of Real Estate Boards
San Juan Mandaluyong Chapter 1998, 1999
PRC # 6569
PRC Lecturer’s License # 0294
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CASE STUDY :

It’s a fact that so many property owners / heirs are now going to Extra Judicial Settlement due to the Amnesty and the reduced rate of Estate Taxes the government has approved as a Revenue Regulation.

Early last year, I had a case with a property owner wherein the Father has remarried and has a second family with children.  Prior to this marriage, the Father had acquired a property in the name of the other woman then so as to secure the ownership of his would be second family.

About five years ago, they decided to sell their property and move to another property as the extra money from the sale can be used for their retirement.  Since the property was qualified for Capital Gains Exemption as it was their primary residence, they had to put in under their names as required by the law.  The then single woman is now married to the Father so naturally the new title had to be named to both husband and wife. 

Now this is where the issue may arise.  Since the title is named to both husband and wife, the children from the first family are now legitimate heirs to the property should the inevitable event happen.

So what option do they have to protect the interest of the second family who rightfully owns the property ?

Donating the property comes into mind but this is a big mistake as this can be contested in court. This is called COLLATION. 

Collation : Collation is the return of the donations made by the deceased to his hereditary estate either by adding mathematically the value of said donation or by actually bringing them back to the estate. It takes place when there are compulsory heirs to determine the legitime and the free portion so that there will be equality of distribution among them.

The best and only way to secure ownership is to sell the property to the children from the second family so as to avoid any complication that will arise which normally does happen given the opportunity.

As always, it's best to talk to a Family or Real Estate Lawyer when encountering situations such as this.

A great day to All and please look forward to my you tube channel where I will be doing my blogs on important matters you should know about Philippine Real Estate.

Email your inquiry or concerns to : robertgsarmientoproperties@gmail.com
 
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robert
Robert G. Sarmiento Properties
Professional Affiliation :
Philippine Association of Real Estate Boards
Member, City of Taguig Real Estate Board 2016 - 2019
Real Estate Broker’s Association of the Philippines 2000 - 2015
President, San Juan 2008, 2009
Philippine Association of Real Estate Boards
San Juan Mandaluyong Chapter 1998, 1999
PRC # 6569
PRC Lecturer’s License # 0294
 

 

 
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