Deed of Real Estate Mortgage (Philippines)
DEED OF REAL ESTATE MORTGAGE
Civil Code of the Philippines (RA 386, Arts. 2085–2092) | Property Registration Decree (PD 1529) | Act 3135 (Extrajudicial Foreclosure)
This DEED OF REAL ESTATE MORTGAGE ("Deed") is executed as of [Date]
BETWEEN:
(1) [Mortgagor Name], of [Mortgagor Address] (hereinafter "Mortgagor"); AND
(2) [Mortgagee Name], of [Mortgagee Address] (hereinafter "Mortgagee").
RECITALS
A. The Mortgagor has applied to the Mortgagee for a loan in the principal amount of [Loan Amount] ("Principal Amount").
B. As a condition for the grant of the loan, the Mortgagor agrees to constitute a real estate mortgage in favor of the Mortgagee over the property described herein as security for the repayment of the loan and all obligations arising therefrom.
NOW, THEREFORE, for and in consideration of the loan of [Loan Amount], the Mortgagor hereby mortgages to the Mortgagee, its successors and assigns, the following real property:
[Property Description], covered by [TCT Number], situated in [Property Location], Philippines ("Mortgaged Property").
TO SECURE the full and faithful payment and performance of all obligations of the Mortgagor to the Mortgagee, including: (a) the Principal Amount of [Loan Amount]; (b) interest thereon at the rate of [Interest Rate] per annum; (c) all costs of collection and foreclosure; and (d) all other amounts owing under the loan agreement. The loan is repayable over a term of [Loan Term] and shall mature on [Maturity Date], on which date the entire outstanding balance shall become due and payable.
1. MORTGAGOR'S COVENANTS
1.1 The Mortgagor warrants that they are the absolute owner of the Mortgaged Property free from all liens and encumbrances except as disclosed herein, and has the right to mortgage the same under Civil Code Article 2085.
1.2 The Mortgagor shall: (a) pay all Real Property Tax (RPT), special assessments, and charges on the Mortgaged Property when due; (b) maintain the property in good condition; (c) keep the property insured against fire and other risks in an amount not less than the outstanding loan balance; and (d) not further encumber, sell, or dispose of the Mortgaged Property without the Mortgagee's prior written consent.
2. DEFAULT AND FORECLOSURE
2.1 The following shall constitute events of default: (a) failure to pay any amortization or installment when due; (b) breach of any covenant in this Deed; (c) insolvency or bankruptcy of the Mortgagor; and (d) material deterioration of the value of the Mortgaged Property.
2.2 Upon default, the Mortgagee may, at its option, declare the entire outstanding obligation immediately due and payable, and foreclose this mortgage extrajudicially in accordance with Act 3135 (as amended by Act 4118), or judicially under Rule 68 of the Rules of Court. The Mortgagor shall have a one-year redemption period from the date of registration of the foreclosure sale certificate.
3. DOCUMENTARY STAMP TAX AND REGISTRATION
3.1 The Mortgagor shall pay Documentary Stamp Tax (DST) at the rate of PHP 10.00 per PHP 200 of the loan amount (0.5%) to the Bureau of Internal Revenue (BIR) using BIR Form 2000 within five days after the close of the month of execution, as required by NIRC Section 195 as amended by the TRAIN Law (RA 10963).
3.2 The Mortgagor shall present this Deed for registration at the Register of Deeds of [Property Location] for annotation on [TCT Number] under PD 1529. The costs of registration shall be borne by the Mortgagor.
4. GOVERNING LAW
4.1 This Deed is governed by the laws of the Republic of the Philippines, including the Civil Code (RA 386, Arts. 2085–2092), Act 3135, and PD 1529.
Mortgagor
________________
Signature
Mortgagee
________________
Signature
What Is a Deed of Real Estate Mortgage (Philippines)?
A Deed of Real Estate Mortgage in the Philippines charges the described property to secure repayment of the debt, setting out the terms on which the security may be enforced.
Under Civil Code Article 2085, an essential requisite of a valid mortgage is that the mortgagor must be the absolute owner of the property mortgaged or have free disposal over it. A mortgage constituted by a non-owner is void ab initio. Article 2087 provides that the mortgagee acquires only a lien on the property — not ownership — and the mortgagee's right to foreclose arises only upon default. The Supreme Court in Philippine National Bank v. Court of Appeals (G.R. No. 108870, July 14, 1995) reaffirmed that a real estate mortgage is an accessory contract: it has no independent existence apart from the principal loan obligation it secures.
A Philippine Deed of Real Estate Mortgage must be registered at the Register of Deeds of the province or city where the property is located. Under PD 1529 Section 51, registration is constructive notice to all persons, and an unregistered mortgage is not binding on third parties. The mortgage is annotated on the Transfer Certificate of Title (TCT) or Condominium Certificate of Title (CCT) of the mortgaged property. Documentary Stamp Tax (DST) at PHP 10 per PHP 200 (0.5%) of the loan amount or property value must be paid to the Bureau of Internal Revenue (BIR) before or upon execution, per the National Internal Revenue Code (NIRC) Section 195.
Foreclosure of a Philippine real estate mortgage proceeds either judicially — by filing a complaint with the Regional Trial Court (RTC) under Rule 68 of the Rules of Court — or extrajudicially under Act 3135 (as amended by Act 4118), which allows the mortgagee to foreclose by public auction after the required notice publication in a newspaper of general circulation for three consecutive weeks.
The legal framework governing the Deed of Real Estate Mortgage (Philippines) in Philippines draws on several key statutes and regulatory bodies. Under Philippine law, the Civil Code of the Philippines (Republic Act No. 386) governs contractual obligations. The Revised Corporation Code (Republic Act No. 11232) regulates corporate entities through the Securities and Exchange Commission (SEC). The Labor Code of the Philippines (Presidential Decree No. 442) and Department of Labor and Employment (DOLE) govern employment matters. The Data Privacy Act of 2012 (Republic Act No. 10173) and the National Privacy Commission (NPC) protect personal data. The Bureau of Internal Revenue (BIR) administers tax obligations under the National Internal Revenue Code. Parties executing a Deed of Real Estate Mortgage (Philippines) in Philippines should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Property Registration Decree (PD 1529) sets the foundational requirements.
When Do You Need a Deed of Real Estate Mortgage (Philippines)?
A Deed of Real Estate Mortgage Philippines is needed whenever real property is pledged as collateral for a financial obligation.
Bank housing loans: Filipino homebuyers securing home loans from banks such as BDO Unibank, BPI Family Savings Bank, or Security Bank execute a Deed of Real Estate Mortgage in favor of the bank as a condition of loan release. The bank retains a lien on the TCT until the loan is fully paid, after which the mortgage annotation is cancelled at the Register of Deeds.
Pag-IBIG Fund (HDMF) housing loans: Members of the Pag-IBIG Fund borrowing for house-and-lot purchases or construction execute a Deed of Real Estate Mortgage in favor of the Home Development Mutual Fund (HDMF). Pag-IBIG housing loans are among the most common mortgage instruments in the Philippines, with loan amounts up to PHP 6,000,000.
Private lending and family loans: Individuals borrowing from private lenders — including family members, cooperatives, or lending companies — secure the loan with a real estate mortgage to provide collateral protection and evidence of the obligation.
Business expansion financing: Small and medium enterprises (SMEs) registered with the Securities and Exchange Commission (SEC) or the Department of Trade and Industry (DTI) pledge commercial or residential real property to secure term loans or credit lines from rural banks, thrift banks, or microfinance institutions regulated by Bangko Sentral ng Pilipinas (BSP).
Refinancing: Property owners who have existing mortgages with high interest rates refinance by executing a new Deed of Real Estate Mortgage with a new lender, using the proceeds to pay off the original mortgage — requiring a Release of Real Estate Mortgage from the prior mortgagee before the new mortgage is registered.
Parties in Philippines should prepare a Deed of Real Estate Mortgage (Philippines) proactively rather than waiting for a dispute to arise. Courts interpret agreements based on the written terms rather than oral representations. Under Philippine law, the Civil Code of the Philippines (Republic Act No. 386) governs contractual obligations. The Revised Corporation Code (Republic Act No. 11232) regulates corporate entities through the Securities and Exchange Commission (SEC). The Labor Code of the Philippines (Presidential Decree No. 442) and Department of Labor and Employment (DOLE) govern employment matters. The Data Privacy Act of 2012 (Republic Act No. 10173) and the National Privacy Commission (NPC) protect personal data. The Bureau of Internal Revenue (BIR) administers tax obligations under the National Internal Revenue Code. Where the transaction involves regulated activities, prior approval from the relevant authority may be required before execution.
What to Include in Your Deed of Real Estate Mortgage (Philippines)
A valid Philippines Deed of Real Estate Mortgage must include the following essential elements.
Parties: Full legal names, addresses, and Tax Identification Numbers (TINs) of the mortgagor and mortgagee. For banks and corporations, include SEC/BSP registration number and authorized signatory per Board Resolution.
Principal Obligation: The loan amount in Philippine Pesos (PHP), interest rate, repayment schedule, and maturity date of the obligation secured by the mortgage. The mortgage is accessory to this principal obligation.
Property Description: Complete description of the mortgaged property including TCT/CCT number, lot area, improvements, and location by barangay, city/municipality, and province. The description must match the TCT/CCT exactly.
Mortgage Terms: The mortgagor's obligation to maintain the property, pay Real Property Tax (RPT) and insurance, and not further encumber the property without the mortgagee's written consent.
Default and Foreclosure: Events of default, cure period, and the mortgagee's right to foreclose either judicially under Rule 68 of the Rules of Court or extrajudicially under Act 3135.
Documentary Stamp Tax: Acknowledgement of the obligation to pay DST at 0.5% of the loan amount to the BIR before registration.
Notarization: The deed must be notarized — a public instrument is required for registration at the Register of Deeds under PD 1529.
Registration: The mortgagor's obligation to present the deed for registration at the Register of Deeds within 60 days of notarization so the mortgage is annotated on the TCT/CCT.
Additional compliance elements for a Deed of Real Estate Mortgage (Philippines) used in Philippines include: Under Philippine law, the Civil Code of the Philippines (Republic Act No. 386) governs contractual obligations. The Revised Corporation Code (Republic Act No. 11232) regulates corporate entities through the Securities and Exchange Commission (SEC). The Labor Code of the Philippines (Presidential Decree No. 442) and Department of Labor and Employment (DOLE) govern employment matters. The Data Privacy Act of 2012 (Republic Act No. 10173) and the National Privacy Commission (NPC) protect personal data. The Bureau of Internal Revenue (BIR) administers tax obligations under the National Internal Revenue Code. Forms-legal.com provides this template as a starting point for Philippines-compliant documentation.
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Forms Legal. (2026). Deed of Real Estate Mortgage (Philippines) (Philippines) [Legal document template]. Forms Legal. https://forms-legal.com/philippines/real-estate/purchase-sale/deed-of-real-estate-mortgage-philippines
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}Frequently Asked Questions
A real estate mortgage in the Philippines may be foreclosed through two methods: judicial foreclosure and extrajudicial foreclosure. Judicial foreclosure is filed as a complaint with the Regional Trial Court (RTC) having jurisdiction over the property under Rule 68 of the Rules of Court. The court may order sale by public auction after due proceedings, with a 90-day redemption period from the date of entry of judgment. Extrajudicial foreclosure — the more common and faster method for bank mortgages — is governed by Act 3135 as amended by Act 4118. Under Act 3135, the mortgagee must publish a notice of public auction in a newspaper of general circulation once a week for three consecutive weeks and post the notice in at least three conspicuous public places in the municipality where the property is located. The mortgagor has a one-year redemption period from the date of registration of the auction sale certificate, during which time the mortgagor may redeem the property by paying the auction price plus interest and costs.
When executing a Deed of Real Estate Mortgage in the Philippines, Documentary Stamp Tax (DST) is payable under Section 195 of the National Internal Revenue Code (NIRC) as amended by the TRAIN Law (RA 10963). The DST rate is PHP 10.00 for every PHP 200 — or fraction thereof — of the loan amount secured by the mortgage. This effectively equals 0.5% of the loan amount. DST must be paid to the Bureau of Internal Revenue (BIR) using BIR Form 2000 within five days after the close of the month when the deed was made. The Register of Deeds will not accept a Deed of Real Estate Mortgage for annotation on the TCT/CCT unless the BIR-stamped original deed or the BIR Form 2000 receipt showing DST payment is presented. Under Philippines law, Property Registration Decree (PD 1529), parties should seek independent legal advice from a qualified lawyer to confirm compliance with all applicable requirements. Under Philippine law, the Civil Code of the Philippines (Republic Act No. 386) governs contractual obligations. Forms-legal.com provides this template as a starting point for Philippines-compliant documentation.
A Real Estate Mortgage (REM) and a Chattel Mortgage (CM) are both security contracts in the Philippines but cover different types of property. A Real Estate Mortgage under Civil Code Articles 2085 to 2092 covers immovable property — land, buildings, and improvements attached to land. It must be registered with the Register of Deeds and annotated on the Transfer Certificate of Title (TCT). A Chattel Mortgage under the Chattel Mortgage Law (Act 1508) covers movable property — vehicles, equipment, inventory, and goods. It must be recorded in the Chattel Mortgage Register of the Register of Deeds. For properties that are borderline — such as a house built on land the owner does not own — Philippine courts have applied the chattel mortgage concept in Tumalad v. Vicencio (G.R. No. L-30173, September 30, 1971), holding that parties may treat an immovable as chattel by mutual agreement and registration under Act 1508. In practice, banks in the Philippines use real estate mortgages for land and buildings and chattel mortgages for vehicles under the Land Transportation Office (LTO) encumbrance registration system.
A Deed of Real Estate Mortgage (Philippines) does not legally require a lawyer in Philippines, and individuals and businesses may draft and execute the document independently. The Property Registration Decree (PD 1529) does not mandate legal representation for the creation or signing of this type of document. However, seeking independent legal advice from a qualified Philippines lawyer is recommended for transactions involving substantial financial value, complex regulatory requirements, or cross-border elements where multiple legal jurisdictions may apply. A lawyer can verify that the document complies with all applicable statutory requirements, identify potential risks specific to the transaction, and confirm that the terms adequately protect the interests of all parties involved. The Supreme Court of the Philippines has jurisdiction over disputes arising from this type of document, and Securities and Exchange Commission (SEC Philippines) may impose additional compliance obligations depending on the nature of the underlying transaction. Professional legal review is particularly advisable where the document will be submitted to government agencies or used as evidence in legal proceedings.
A Deed of Real Estate Mortgage (Philippines) does not legally require a lawyer in the Philippines, though legal advice is recommended. Under Philippine law, the Civil Code of the Philippines (Republic Act No. 386) governs contracts. The Securities and Exchange Commission (SEC) regulates corporate documents. The Department of Labor and Employment (DOLE) oversees employment agreements. The Data Privacy Act of 2012 (Republic Act No. 10173) and National Privacy Commission (NPC) impose data protection obligations. The Bureau of Internal Revenue (BIR) requires tax compliance. Forms-legal.com provides this template as a starting point — always review with a qualified Philippine attorney for significant transactions. Under Philippines law, Property Registration Decree (PD 1529), parties should seek independent legal advice from a qualified lawyer to confirm compliance with all applicable requirements. Under Philippine law, the Civil Code of the Philippines (Republic Act No. 386) governs contractual obligations. Forms-legal.com provides this template as a starting point for Philippines-compliant documentation.
This template is provided for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change over time. Consult a qualified attorney for advice specific to your situation.Full disclaimer
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