This was first published back in January 2008. I’ve made some corrections and updates, but the basic facts remain the same … owning land in the Philippines, even when you follow the rules … is fraught with many risks. Americans tend to grumble and complain about the restrictions against foreigners buying land here … but compared with buying land in the USA, it’s just not at all what you think it might be. As a foreigner, not only are your rights limited, but your knowledge and understanding of the system is flawed as well. You can’t come here and do business as you would in the US. Caveat emptor.
Title Insurance Philippines
From time to time the question of buying property, with or without a home on it comes up in most of the Philippines-related blogs and discussion groups. It often becomes contentious. Many get quite emphatic about how much safer they feel ‘owning’ their own land, even when, in point of fact, they don’t own anything at all. those of us who attempt to illustrate the fallacy of their ‘position of security’ often take some flak, but if I prevent just one person from losing their life savings due to fraud or misunderstanding, I’ll happily take the flak.
I originally expected to cover a lot of ground regarding alternatives to land ownership in this particular post, but when I started digging into one of my main objections … or at least cautions … regarding land purchases in the Philippines, I came across this work by a distinguished Filipino lawyer, legislator and defender of property rights which basically outlines the state of land titles and the rights of property buyers in the Philippines a lot better than I ever could.
A Voice for Title Insurance in the Philippines
Remember that these words were written by the then senate minority leader, Senator Aquilino Q. Pimentel Jr. and they represent true findings of official government investigations. We aren’t talking ancient history here, and these are the words of a lawyer of more than 20 years experience who is well aware of the legal dangers of putting words in print which aren’t true.
In the Philippines, the vast majority of land is owned under so-called ‘tax certificates’. This form of ownership is also used in the US, but typically only by speculators who buy land at sales for delinquent taxes with the hope that in the future the investor will actually be able to ‘perfect’ the title, that is obtain a real and valid title to the property.
The vast majority of tax certificates never get to that stage … the original owner or his/her heirs make up the deficiency, pay the holder of the certificate a state-controlled fee for his time and trouble and go back to being in legal possession of the property.
The Philippines has in place an excellent ‘real’ title system the “Torrens” title, named after it’s Australian inventor and deemed one of the best title systems ever invented. Them why does a majority of the land lack current Torrens titles?
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