How to transfer land title to heirs in the Philippines (Extrajudicial Settlement)

by | Oct 20, 2018 | Estate Law, Wills & Inheritance

This article outlines the step-by-step process to sell a Philippine inheritance or to transfer it to your name.

This process is called “settling the estate”.

In this article you’ll find:

  • Practical advice on how you can access a deceased’s bank account shortly after death.
  • Common issues you face in gathering documents and even in filling up BIR forms.
  • A pretty good understanding of the overall process from death to receiving the Certificate Authorizing Registration, which is when property transfer becomes possible.

This article specifically considers an agreeable settlement of the estate which avoids a contentious court case. It gives you a good grasp of the main issues you and your co-heirs will need.

However, you may still have to consult with an accountant or a lawyer at some point. Settling an estate can be complicated and you might need professional advice.

Settling an EstatePart 1: Introduction

If you have inherited real estate, stocks or vehicles you are going to have to settle the estate if you intend to sell the assets to another or transfer them to your name.

Settling an Estate

If you have inherited real estate, stocks or vehicles you are going to have to settle the estate if you intend to sell the assets to another or transfer them to your name.

Why?

The new owner will want the title in his name.

However, you will need the Bureau of Internal Revenue clearance called the Certificate Authorizing Registration (CAR) to formally transfer anything. You will have to settle the estate to get the CAR.

An set of items composing an estate with heirs surrounding it.

Settle an estate in 7 steps!

Settling the estate involves 7 main steps which involve paying off the debts of the deceased, settling unpaid taxes, and reaching an agreement with your co-heirs.

You should try to settle the estate within the BIR deadline of a year from the death. The reason is that the penalties beyond this period can be enormous:

  • 25% annual tax on the amount due
  • 20% surcharge on the amount due

With charges like these, it is possible that the tax required might eventually equal the estate.

Settling an estate means paying transfer taxes at the BIR, which should be paid as soon as possible.

Pay estate taxes within 1 year from the death or fees and penalties can be onerous!

You can see why it is best to file with the BIR as soon as possible or to even just file a partial return in order to forestall the penalties.

Get the Death CertificatePart 2: Death Certificate

The death certificate is the first document you’ll need to obtain.

Get the Death Certificate

The death certificate is the first document you’ll need to obtain.

You will need to present this to the funeral home, insurance office, banks, BIR, etc. – in short, everyone with whom you will need to transact with regarding the recent death.

Death certificates are one of the first documents needed.

Get several copies of the death certificate!

If the death took place in a hospital, the hospital will release the death certificate. If the death took place in a home, the attending doctor or the barangay health officer will help you accomplish the death certificate.

You’ll need 10 certified true copies of the death certificate (at least!).

It is a civil registry document which may be obtained at the local or national level.

While the local civil city registrar might have recorded the death, the national civil registrar may take between a few weeks to a few months.

This is because the process takes time.

Time passing as a man wait for the process to finish.

Be patient – it’s a time consuming process.

First, the local civil registrar will record the death. Then, it will send this to the Philippine Statistics Authority (Office of the Civil Registrar General). Then the PSA records, processes and encodes the document into the national database of the main civil registrar.

This means that the PSA certified death certificate will not be immediately available after the death. Your recourse will be to call on the local civil registry where the death was registered and get the local copy. (Note that you should remember to eventually get the PSA certified death certificate.)

In any case, with the death certificate in hand — whether local or PSA certified — you can begin to address the tax issues as well as other immediate concerns.

Get BIR form 1904Part 3: BIR 1904

Expenses can be one of the most pressing concerns of a family after a death.

Get BIR form 1904

Expenses can be one of the most pressing concerns of a family after a death.

A family may find that it does not have cash immediately on hand with which to meet the expenses death brings about. The family may find that the cash is locked in the bank account of the deceased.

The new Tax Reform for Acceleration and Inclusion Act (TRAIN) law has partially addressed this problem. Subject to certain conditions and requirements, the law now allows you to access the deceased’s bank accounts even before the settlement of the estate is concluded for up to 1 year after the death.

Withdrawing from the deceased's bank account in 5 steps.

5 steps to withdraw from a deceased’s bank account.

You would need to present to the bank the following:

  • The Death Certificate
  • The Estate’s TIN which will be received after filing BIR Form 1904
  • Other documents required by the bank

You’ve already got the death certificate.

Now, we’ll go through what needs to be done to get the Estate’s TIN.

The Estate’s TIN registers the estate as a taxable entity. This will be needed for all financial transactions regarding the estate. It is different from the TIN the deceased used while he was alive.

Getting the Estate’s TIN is a fast and simple process.

Below, we will go through the form and how to fill it up.

You can get Form 1904 from the BIR’s website.

I’ve split the form into 2 parts so that we can go through it easily.

BIR 1904 - Part 1

BIR 1904 Form – Part 1

Let’s go through some of the fields for the first part:

  • Taxpayer Type should be One-Time Taxpayer.
  • Classification should be Non-Individual here.
  • Write “Estate of [Name of the Deceased]” for the taxpayer’s name
  • Date of Birth should be the Date of the Death as it appears on the death certificate
  • I think that sex, civil status, spousal information and telephone number are pretty clear.
BIR 1904 - Part 2

BIR 1904 Form – Part 2

Almost there!

We’ll go through some of the other fields for the rest.

  • Local Address and its corresponding telephone number should be the address as it appears on the death certificate
  • One Time Transactions should be Transfer of Properties by Succession
  • Tax Type should be Estate Tax

You’ll also need to submit the Death Certificate with this form.

You then submit the form at the BIR Regional District Office (RDO) where the deceased lived. You shouldn’t submit at any other location.

You can then withdraw from banks with the estate TIN up to 1 year after the death, although this is subject to 6% withholding.

Calling to make sure the documents required to withdraw from the deceased's bank account are complete.

Call the bank to find out the bank’s requirements – they may have additional bank-specific documents needed.

This change due to the TRAIN law is new. As a result, some banks are not yet entirely updated regarding this. You’ll have to coordinate with them and explain.

This is a good time to talk about taxable and non-taxable estates.

Estates whose valuation exceeds certain thresholds are taxable. On the other hand, estates fall below these thresholds will not be subject to estate tax.

Consult with a professional to calculate estate tax as it can get complicated!

Does estate tax apply? Only estates above a certain amount are taxable.

This is important because the non-taxable estate would not be subject to the 6% withholding tax.

You would have to calculate the total estate to find out. Then you will have to pay the estate tax. At this point, you can withdraw without the 6%.

Calculating and paying the estate tax would take time however so this might not be a route for you if the family needs the locked cash immediately

Determine Estate DocumentsPart 4: Estate Documents

You and your co-heirs will need to determine the scope of the estate.

As an heir to the estate, you might want to transfer or sell your inherited assets. But what are the assets? What else is the estate composed of?

You and your co-heirs will need to determine the scope of the estate.

All the items that make up an estate.

What is the estate made of?

What are the estate’s assets?

They can be:

  • Real estate such as the family home, condominiums or land titles
  • Shares of stock or shares of memberships such as a country club
  • Motor vehicles

What are the estate’s liabilities?

  • Are there any loans that the deceased took out?
  • Are there are unpaid taxes?

You will need all the documents proving ownership as well. For real properties, you will need the titles and the tax declarations and improvements from the city assessor, if ever. You will need stock certificates for stocks and you will need the registration for all vehicles.

It is the same for loans and obligations. You will need to gather promissory notes and other obligations.

You need a lot of documents to settle an estate.

Expect to gather a lot of documents!

This can be a painstaking task.

It can be tough to figure out where documents are. Very often, only the deceased knew where the papers were kept.

Conferring with family can be an important early step for this.

It is also possible to track down the land titles by painstakingly working with the pertinent government agency. It is a detailed process and requires a lot of patience. It may require visiting the Register of Deeds where the land is located as well.

You need to complete the documents to settle an estate so investigation may be needed.

You might need a private eye.

Another option is to hire private investigators to determine the actual extent of the property and then to work towards reconstructing a complete picture.

What you end up doing to reconstruct the estate will depend on the information you have.

At this point, you might also want to hire an accountant to help you understand the estate and the taxes involved. He can help you understand what you’ll have to pay to the BIR and what you might be able to save.

Co-heirs Estate AgreementPart 5: Estate Agreement

After you’ve figured out what the estate is composed of, you and your co-heirs will need to agree among yourself how the properties will be partitioned.

After you’ve figured out what the estate is composed of, you and your co-heirs will need to agree among yourself how the properties will be partitioned.

Why?

Well, Philippine law only determines the proportions that go to specified heirs. However, the extrajudicial settlement actually determines who will receive what property.

Heirs must agree on how the properties will be shared.

Heirs need to decide how to partition the estate

This is often contentious.

Think about your family.

Then think about all the cares that each heir might have with regard to providing for his family. Add to that all the history of small hurts and disagreements and it’s easy to see how quickly things can go wrong.

Your sister might want the family home, but your brother might actually be living in it. Or there might be 2 properties but one sibling wants to keep them while the others want to liquidate. You will all have to reach an agreement about what will be done.

Heirs struggling under the burden of debt.

Heirs must agree on how to pay debt

In addition, you will have to determine how you will pay all outstanding debts. You may draw on the deceased’s bank account, but often you and your co-heirs may have to shoulder the burden. The estate must have no debts for it to be given to the heirs or even sold.

Intermediaries can often help in reaching this all-important agreement as it is this concert that is the basis of the extrajudicial settlement. A failure of the heirs to agree will make extrajudicial settlement impossible.

Execute an Extrajudicial SettlementPart 6: Extrajudicial Settlement

If an agreement is made or brokered between the heirs, they will then create the extrajudicial settlement (or the Deed of Adjudication, if you are the sole heir).

Execute an Extrajudicial Settlement

If an agreement is made or brokered between the heirs, they will then create the extrajudicial settlement (or the Deed of Adjudication, if you are the sole heir).

An extrajudicial settlement is an agreement between heirs.

An extrajudicial settlement is a legal agreement detailing the partition of an estate.

It should have the following information:

  • That the deceased left no will and no debt or that his debts have been paid
  • You and your co-heirs relationship to the deceased and that there are no other heirs
  • Description and details of the properties and how they are to be divided

Afterwards, everyone should sign and notarize the document.

A notice will then be published in a newspaper of general circulation for 3 weeks.

You will present the need the proof of publication along with the extra-judicial settlement to the BIR.

File BIR 1801Part 7: BIR 1801

If you’ve accomplished all the items up top, you are in a really good position to start filing your BIR 1801.

File BIR 1801

If you’ve accomplished all the items up top, you are in a really good position to start filing your BIR 1801. You need to do this within a year after the death to avoid those heavy penalties we talked about earlier.

BIR 1801 is filed to pay the taxes to finally settle the estate.

It is deceptively simple and is currently supported by 5 schedules.

Estate Tax Return 1801

Estate Tax Return – 1801 Form

With all the work you’ve already put in, you are in a really good position to fill this up. (Note that the BIR is currently using the pre-TRAIN law form so there will be some non-applicable fields.)

Work with your accountant to fill up the information and verify your estate taxes.

Only an accountant can help you minimize your possible taxes.

There are some pretty clear deductions straight off the bat:

  • Php 5,000,000 for Philippine citizens and resident aliens
  • Php 10,000,000 for the family home

However, there may be tax treaties and there are other possible tax exemptions applicable to your situation that only an accountant or lawyer would know.

An accountant helps calculate estate taxes.

An expert can help save you money.

Then, armed with your calculation and all your documents, you should head off to the appropriate BIR RDO (where the permanent home of the deceased was located).

You’ll need to talk to the One Time Transaction Officer (ONETT) and go through the calculation with him.

ONETT officers are rotated, but if you like the ONETT officer you are working with, try to figure out his schedule and his personal contact information. ONETT officers vary slightly how they deal with estate issues so it’s best to stick to one throughout the process.

If all your documents are in order, you should be able to do this relatively quickly.

Pay the Estate TaxPart 8: Pay for CAR

One of the last big hurdles is paying the estate tax.

Pay the Estate Tax

So, you’ve made it this far!

One of the last big hurdles is paying the estate tax.

After you’ve calculated the Estate Tax to be paid, you will need to actually pay it at the Authorized Agent Bank (AAB).

Estate taxes can only be paid at an Authorized Agent Bank.

Pay estate taxes at any Authorized Agent Bank.

An Authorized Agent Bank is a bank that accepts payments on the BIR’s behalf.

You may choose to pay the bank in cash or through a manager’s check.

If you do choose a manager’s check, call the bank so that you know exactly how they want the payee to be written on the check.

Make sure you get the banks machine validation on the proof of payment.

Now make a trip to the BIR to present this and receive your Certificate Authorizing Registration.

If you’ve got everything ready and there are no pending issues, your CAR shouldn’t take too long to process.

With the CAR, you can now easily sell your inherited property or transfer it to your name.

SummaryPart 9: Notes & Summary

If you’ve got a pretty simple estate to settle with just a few properties and some stocks, this guide is a good starting point to understand the work you need to put in.

If you’ve got a pretty simple estate to settle with just a few properties and some stocks, this guide is a good starting point to understand the work you need to put in.

This post focuses on providing practical advice from the point of view of the layperson.

This doesn’t cover all the intricacies of settling an estate.

Estate settlement has many parts.

Settling an estate has many steps.

Many times, you’ll get held up looking for documents which can require a ton of work just to replace. You might have problems with land titles. You might also have problems with unpaid real estate taxes.

Each of those issues can be detailed, expensive, and painstaking to solve (depending on the exact situation).
Still, I hope that this practical guide helps you and your family understand the process better.

91 Comments

  1. Marie Christine

    Thank you for this article! I had no idea how complicated land issues in Philippines is!! My question is this; my sister recently tried to sell land that I bought from my father. The land in question is still undivided to this day and remained in my Grandfather’s name who ded 40 years ago. So how come my sister found a buyer who was willing to pay for it, when she did not have any paperwork as proof that she owned it??

    Reply
    • Lawyers in the Philippines

      Transferring the title to the buyer’s name will be quite difficult in this situation.

      This buyer may not be aware of the work required or may be willing to undertake it.

      In the vast majority of cases however, this is often why titles are not transferred even after payment has been given. The buyer suddenly discovers how difficult it actually is to transfer the land to their name and are stymied.

      Reply
  2. Gliceria Aldana

    Very helpful information… I will apply this in my quest for extrajudicial settlement of the properties left by my parents.

    Reply
    • Lawyers in the Philippines

      Thank you. It’s good to know that the information is useful.

      Reply
  3. Muriel

    Thank you so much for this article!! Now it gives me a clear picture of what to do….which is nothing, due to so many required paper work. I don’t even where to start! Well, I do now, thanks to you. It seems such a daunting task and probably not worth my time and effort, for a property that I only paid P400,000 for.

    One last question please. What is the alternative for extra judicial settlement if the siblings won’t sign the extra judicial paperwork?

    Reply
    • Lawyers in the Philippines

      Dear Muriel:

      I believe I have sent you an email regarding this.

      Just a note —

      While confusing to the layperson, lawyers are quite familiar with this type of problem. It is possible to resolve it and see it through.

      Reply
      • Daniel

        Some heirs are uncooperative in making extrajudicial settlement. What is the next step? I want to pay my share of inheritance tax.

      • Lawyers in the Philippines

        In this case, people either hire lawyers to negotiate and then bring the case to court as needed.

        It is usually better to negotiate before bringing the case to court as it is generally better for the family to stay out of court.

  4. Brian

    This article is very helpful, already bookmarked this for future reference, but I have a question, My father died last 2013, till now we haven’t settled / process his only property. He doesn’t have any debts, Money to his name, Bank account or anything aside from that one property he owns in the province. question is can we go directly to the extra judicial settlement part and divide among us siblings (my mother doesn’t want to be in any part of that land as she just want it to our names) or we should still go thru the whole process?

    Reply
    • Lawyers in the Philippines

      Hi Brian:

      I am not certain what you mean.

      Transferring when there is no will is through extrajudicial settlement and it goes through all the steps I mentioned in the above article.

      Reply
      • Henry

        Hi. I saw this post yesterday and I would like some advice.
        My mom died in 2013. Properties (2) in her name were not transferred to my dad and us children.
        Then my dad died in 2017 and properties (2) in his name were also not transferred to us.
        We are 6 siblings. 4 are abroad and are no longer Filipino citizens. 2 of us are here in manila.
        Those abroad want to waive their rights to all the properties.
        1) How many extrajudicial settlements do we need?
        2) We want to avail of the Estate Tax amnesty. How do we go about it?
        I would appreciate your reply. Thank you.

      • Lawyers in the Philippines

        Sent an email.

  5. May

    Good evening. My grandparents, who died in 1976, left a house and lot. There were 8 children; 3 are deceased (all Philippine residents), while 3 are living abroad. May I know the procedure of executing an extrajudicial settlement, esp that the 3 siblings are abroad, and cannot physically participate in the settlement. What documents should they send, to be attached to the affidavit that the Philippine residents will execute? Thank you for your answer.

    Reply
    • Lawyers in the Philippines

      Hi May:

      First, the extrajudicial settlement needs to be executed among all the heirs. In this case, the heirs are the children of your grandparents and the children of the deceased children.

      For the heirs abroad, a red-ribboned Special Power of Attorney would first be needed with the associated proof of identity.

      Reply
  6. Chona

    Hi. I stumbled upon this article because I was trying to double check if what people from different agencies are telling us is true about how tedious the process is.Turns out that it is. We were planning to build a house on the lot we bought. The only proof of ownership we have is a deed of sale. Is that enough reason to take the risk? I would be happy to explain our case by email. Thank you so much for your time.

    Reply
    • Lawyers in the Philippines

      Sent you an email.

      Reply
    • carlito

      Our grandmother died intestate in the 50s and left a piece of real estate. She had 3 children,—my father and 2 aunties; all three are already deceased. All three died intestate also. WE, the siblings and cousins from all three parents would like to divide our grandmother’s property thru an extrajudicial settlement.
      Question 1.. Can we execute a single extrajudicial settlement that will cite the past 2 generations( intestate grandmother and intestate parents) , but the heirs now are preparing ?
      Question 2. Have there been similar cases like this in the past?

      Reply
      • Lawyers in the Philippines

        Sent an email.

  7. Augusto

    What are the solutions to an heirs encumbrance stated in the title? My siblings and i have agreed to sell the property under our names and we have a buyer already but there is a two year encumbrance on any other heir who might have a claim. My siblings and I are already in our 80s and any one of us can die anytime and we do not want to cause any complications when any One of us dies. We do not know of any other possible heir to this property except us siblings. Will an heirs bond do or a simple contract stating that in the very rare chance an heir does lay a Claim during the two year period, we will shoulder all claims on the property so the buyer is not affected. Thank you!

    Reply
    • Lawyers in the Philippines

      Yes, depending on the property and other considerations, the most practical answer may be to simply sell the property to a willing buyer as is.

      Reply
  8. Jona

    Hi! Both my parents died in 2018. All of us siblings are living abroad. What red ribboned SPA do they need to submit? SPA for a lawyer to represent them or an SPA of extrajudicial settlement? Thanks

    Reply
    • Lawyers in the Philippines

      Sent you an email.

      Reply
  9. Lea

    I came across this article as I am trying to find out what can be done with our case. I am interested in a property that is under the names of my two aunts who were both single and are now both deceased. May I know how I can purchase the property? Is it better to pursue a deed of sale or a deed of donation? Appreciate your guidance on this please.

    Reply
    • Lawyers in the Philippines

      Hi Lea – what needs to be done depends on the exact situation.

      I will send you an email with some question to explain the considerations you must take into account.

      Reply
  10. Alicia

    Hi I am Australian citizen now do I have the right to file a case against my sister to revoke the title since I didn’t sign any documents as part of the family when she applied the title for her share from iour inheritance.if so what I’m gonna do.

    Reply
    • Lawyers in the Philippines

      If you are a legal heir and did not receive your share of the inheritance, you can certainly question any property disposition that did not include your interests.

      Reply
    • Victoria

      My father died 2 years ago..i have 3 sibling and my mother…my parent having a property…but after 2 years my mother decided to subdivide the property to their children and their silbling…but my sibling not agree to her plan to give some property to their sibling just because before my fathers die he wants that property is only for his/her children….my mother already subdivide property and allocation their sibling…my question is what will we do for that case…

      Reply
      • Lawyers in the Philippines

        Sent an email.

  11. REGINA TAGAMOLILA

    Hi, i have an uncle who died 4 years ago and He doesn’t have a family (a wife and child). Their are 5 siblings in the family including may Dad who past away before my uncle. My aunt and uncle decided to make an extra Judicial settlement without our knowledge that they are the heirs of my uncle house and lot and others assets including bank accounts and gold jewelries and decided to sell the property (house and lot) without our consent. My uncle died without any will. Is it possible that we his niece and nephew have the right to have share in the said property which my uncle and auntie sold.

    Reply
    • Lawyers in the Philippines

      Sent you an email.

      Reply
  12. Jerick

    Mary sold the property to Juan. Juan failed to transfer the title to his name. Mary and Juan are both dead now. Juan’s wife has the title bearing Mary’s name. However, Juan’s daughter stole the dead of sale.

    1. What’s the best step to transfer the title to Juan’s 4 siblings.
    2. How to stop Juan’s daughter on doing something illegal with the documents she stole, where she is nowhere to be found.
    3. Juan’s wife is not interested in transferring the title to their children due to the high cost of taxes. What advises to give?

    Reply
    • Lawyers in the Philippines

      By what right do Juan’s siblings claim the property?

      Reply
  13. Ana

    Hi,

    Thank you for this quality information. I’m currently in an extrajudicial settlement at the moment. There is one property involved and although it is to be divided among the Heirs, some have interest in the property, therefore would like to buy out some of the Heirs. Those Heirs are trying to get a low appraisal value of the property, is this allowed? Also, the deceased is known to have a joint bank account with one of the Heirs will this be needed to be noted as one of the deceased assets? Finally, as some of the Heirs are now living in a different country and will be needing SPA’s, can they appoint one of the other Heirs as an SPA or should they find someone not involved in the settlement? Thank you for your time.

    Reply
    • Lawyers in the Philippines

      By its nature, an extrajudicial settlement is an agreement among the heirs. What it stipulates very much depends on what the heirs can agree to. All the deceased’s assets should ideally be accounted for. Yes, the heirs can appoint someone to sign the settlement on their behalf.

      Reply
  14. Gerry

    Is it possible to get an approximate of how much it will cost to transfer a property(house/lot) that say cost 1,000,000 pesos? My father died in 1999 and would like to transfer his property to my name. I read through the procedure but I’m confuse as to the 20% penalty and 25% surcharges that are mentioned in this website. What other costs need to be paid other than the estate tax? Do you have a recommendation of any lawyers who will be willing to do all of these procedures? I really would like to know the total cost of transferring the property title assuming the cost is 1,000,000 pesos.

    Reply
    • Lawyers in the Philippines

      Sent an email.

      Reply
      • Bryan

        Hi, i would like to inquire about the same. my mom passed away 2005 and i would like to transfer our house title to my name since i am planning to renovate the house, and will need the documents to apply for loan (PAGIBIG) to finance the project. I am an only child, and my mom never married. the house&lot valued at around 380k. i’ve read about the penalties of not transferring the title right away after the title owner passed away. will the penalty cost more than the actual property value at this point? what would be your advice on this concern? thanks in advance.

      • Lawyers in the Philippines

        There is an estate tax amnesty currently in force.

        It will only be valid for 2 years from June 2019 which is when the IRR of the Estate Tax Amnesty was released.

        It removes the penalties and allows the transfer of property upon payment of the transfer tax.

        As settling an estate can take a long time, I suggest you start immediately.

  15. Terry

    Hi, my father died in 2011 and he left some properties. We are four in the family. We wanted to execute an extrajudicial settlement however my two siblings are living abroad. The three of us want to waive our shares in favor of our other sibling. My question is – is waiving their rights be done through SPA?

    Thank you.

    Reply
    • Lawyers in the Philippines

      Sent an email.

      Reply
  16. Jenisa

    This question is from my Father, My GrandMother died September 2017 and my grand father is still alive. They already made an extrajudicial settlement last 2017. The heirs of my grandmother are in chaos because other siblings ask somebody to process their land titles but my father wants my sister to process the land title for him. However the person which the other siblings ask to process their title is threatening my father that he will pay penalties if he didnt want him to process the title.
    My question is ;
    1. Is the estate tax needs to be all the land that is given to the heirs or my father can only pay for the parcel that he inhereted.
    2. If the land is 1500 sq.m how much my father will pay for the mentioned penalties and surcharges.
    3. Do we have to wait for the surveyed land registration number before we can process the the documents in BIR.
    4. Does my sister need and SPA to process my fathers land title? Since my father is not well educated and scared to do the process himself.

    Reply
    • Lawyers in the Philippines

      Sent you an email.

      Reply
  17. Sharon

    Hi. My question is this. The Extrajudicial settlement is already done, now waiting only for the paper to be released at the ROD. Me and my brother are named heirs, through interstate as the said property in question belonged to my dad but he passed away without a will. My dad borrowed money from a relative and has a hand-written note naming the property as a collateral in the event that he cannot pay the debt. He passed away before debt was settled. Now the relative who my father owed the money to is contesting the extrajudicial settlement of estate. Please note that the atty who has processed the judicial settlement is aware of the debt but not the promissory note as this was only made known to us recently. My question now is, can this relative bring us to court because of this and due to the fact that my father has signed a promissory note indicating the said property as collateral. What can we do to protect our interests? Are we legally bound to pay the dept, or give up the property altogether since it is held as collateral? In the promissory note, it is stated that there will be 2% interest if payment is not made in the agreed time. The debt is now 16 yrs old but my dad passed away 5 years ago. We are planning to pay the dept in good faith but relative is asking way much more that what we can afford to pa, triple the original amount. Please advise on what to do.

    Reply
    • Lawyers in the Philippines

      Yes, he can bring a case to court.

      I have sent you an email.

      Reply
  18. Teresita

    Very helpful.
    One question please:
    If all of us children are abroad and are living in different states, can we make individual separate extra judicial settlement and submit it as one.

    Reply
    • Lawyers in the Philippines

      Executing individual SPAs would address the situation.

      Reply
  19. Khal

    Hi. My uncle in US wanted to sell his properties in the Philippines. TCT indicated “Husband” married to “Wife”… Wife died a year ago. They have 4 kids (3 in US; 1 deceased in US). My uncle asked me to be his representative to deal with potential buyers, including signing the documents and receiving the payments through SPA. Do they need to file for extrajudicial settlement? Does he need to pay an estate tax? I’ve talked to one lawyer here inthe Philippines, that there is no need for them to file for extrajudicial settlement since TCT only indicates “Husband married to Wife”. Unless it indicated “Spouses” or “Husband and Wife”. Need your advise. Thanks a lot.

    Reply
    • Lawyers in the Philippines

      Sent an email.

      Reply
  20. rose

    Hi im rose, my husband and I purchased a property and its been 6 years to be exact but until now I’m still not finished transferring the title in our name. we buy our land from an agent as they claim to us and we are very trusted to them that they will do all the transfer and so on. so we just paid them the amount that they are asking. without asking some important documents until later I decide to get the documents and I try to process on my own. and. later that we find out we are the one going to pay the estate tax, capital gain tax. so I really get frustrated. just a year ago the agent passed away so I can’t questioned them anymore. now my question are: in estate tax,
    *do I need to pay all the died member of the family?
    *the original owner was the grandparent with 8 sibling are deceased
    * do I have to pay all of them, like the grandpa and grandma, 8 sibling and their spouses and some the heirs who passed away too?
    * and how they compute all of this since they don’t have any record for date of death in the municipalities.
    * I buy the property in lower price since its a hilly for agricultural purposes. please I need your good judgment. thank you in advance.

    Reply
    • Lawyers in the Philippines

      Sent you an email.

      Reply
  21. Juliet

    Good Day!
    Just want to let you know that this article provided an insight on our situation now.
    On my dad’s side of the family, The estate left by my grandfather has not been touched ever since he died. Meaning, for over 30 years, the titles is still on his name and we still pay the taxes same as before. The thing is, my aunt who holds the title died, and we can’t find the titles now, my question is, How are we able to get a new title and if ever we get a new one, do we follow the “procedure” that is listed on this article and go from there? My father and aunt who are the remaining heirs of my grandfather, wanted everthing to be settled as they are old and wanted no trouble in the future.
    If I may specify that my auntie, lives in America and is an American citizen, how am i going to proceed on this?
    Thank you so much for taking time reading this I really apprecite your insight and help.

    Reply
    • Lawyers in the Philippines

      Sent an email.

      Reply
  22. Joris

    Hi, may i ask once the CAR is given, the heir/heirs of the property can freely sell the property of the decedent?
    2) Will they be given a new title in their names (heirs)?
    3) Is it possible once CAR is given, can the new title bore the name of the buyer if the heirs of the decedent decide to sell the property instead?

    Reply
    • Lawyers in the Philippines

      A CAR greatly helps for serious buyers.

      A CAR allows the transfer of the title to the new owners but more processing needs to be done to complete this.

      An extrajudicial settlement with deed of sale allows the property to be transferred to the new owner if that is what was undertaken.

      More information is needed to comment on your case specifically; the above are general statements.

      Reply
  23. AURORA

    Why am I asked to file for the reconstitution of the original Tct lost in the possession of the Register of Deeds when I am Not responsible of losing it? I have my Owner’s Duplicate of Tct. This is UNFAIR!

    Reply
    • Lawyers in the Philippines

      Sent an email.

      Reply
  24. Manel

    Hi. Our mother died in 2016 and the land title is solely entitled to her. We are planning to execute extrajudicial settlement in favor of my older sister and I. Is our father required to sign a waiver?

    Reply
    • Lawyers in the Philippines

      More information is needed to answer this clearly.

      The situation is unclear.

      Reply
  25. Bobby

    Hi. Im going to buy a Lot on a subdivision but the Owner of the lot on the Title passed away already. The wife wanted to sell the lot and she wanted us to pay right away, having only deed of sale and the original copy of the title. And later have it transferred to us as they process it. But on our research, since the original owner on the title is no longer alive, an extrajudicial settlement is needed first, noting that the favor of the settlement is to the wife of the late owner. I am a little bit worry that after the payment transaction, the mentioned property may still be sold to someone else, or other heir may have claim on the property. I am trying to negotiate that we will have the full payment after the title have been filed to the Registry of Deeds, transferring the ownership to us. May I have then the following inquiry:
    1. Holding the original title and the deed of sale will give us authority to the mentioned property? Can they acquire a CTC of the title from the RD and sell it to others?
    2. After the extrajudicial settlement, and having the transfer title to us, is it absolute? what if another heir comes out after it?
    3. What if we, the buyer is composed of two individuals, can we have a title having both names on it, even if we are not related?

    Hoping for your response. Thanks and Best Regards

    Reply
    • Lawyers in the Philippines

      Sent an email.

      Reply
  26. John

    Hello.
    I just have a couple of questions. We are planning to buy a lot that has been sold to the seller (“Juan”) through a Extra-Judicial Settlement with Sale. He has the document that was signed by the heirs of the deceased owner which stated the they agreed to sell the portion of the land to “Juan”. However, Juan did not transfer the title under his name. Upon noticing that he does not have the CTC, I brought up that concern to Juan and he said that the heirs are willing to sign on the deed of sale that we are going to execute.
    1. What is the legal process in case that we will buy that portion of land?
    2. How long is the process will usually take?

    Reply
    • Lawyers in the Philippines

      Sent an email.

      Reply
  27. leyna

    Hi, just want to refer, my aunt(single) died 10 years ago, she left a real estate under her name.. my father is her only sibling.. My parents wanted to transfer that property directly to us (their 2 children).. could it be possible?

    Reply
    • Lawyers in the Philippines

      Sent an email.

      Reply
  28. Mae

    Hi, if the father died first and his estate was divided among his kids through an extra judicial settlement including the decedent’s interest in the family home which was given to son1. Another real ppt was given to son2. The mother died after 10 years, is the family home – for mom’s estate tax computation purposes, valued 50% only since the other half is already owned by the son? So if family home now is 9m is the computation 4.5M for mom’s gross estate less family home deduction of 2.25M? If the real ppt is 2M, is it now valued 1M only?

    Reply
    • Lawyers in the Philippines

      You only pay estate tax on the portion owned by the deceased.

      Reply
  29. Belle

    Good day!

    My grandfather died 17 years ago intestate and left a land. After 2 years, my grandmother also died. They had 8 children, 6 were alive and two were deceased. I and my cousin (both grandchildren) will buy 2/3 of the land, which means the land will be divided into 3 (1/3 for me, 1/3 for my cousin and the other will be named under the 6 siblings alive). My questions are:

    1) Can we make a single (one) extrajudicial settlement with absolute sale? or we should have an individual extrajudicial settlement with absolute sale ( one for my cousin and another one for me).
    2) In extrajudicial settlement with absolute sale, should we include all the children and legal wife/husband of the deceased/s?
    3) In processing the transfer, do we also need to provide death certificates of the deceased children of my grandparents?
    4) In paying the estate tax, does everyone need to have a tax identification numbers, although most of my aunts were plain housewives?
    5) Is it true that we have to pay estate tax for my grandfather, for my grandmother and for the 2 deceased children (as according to the rule, estate tax should be paid for every decedent)?

    Thank you in advance for your reply!

    Reply
    • Lawyers in the Philippines

      Sent an email.

      Reply
  30. Jose

    Hi,
    My mother sold her property to her niece few years ago before she died. Her niece was able to pay the total amount to my mother but there was no contract prepared and signed until my mother died. By mutual agreement, the property was not anymore owned by my mother. Should we need to prepare ‘special’ deed of sale signed by me and my father? On behalf of my mother, what document should I prepare to BIR? Thanks.

    Reply
    • Lawyers in the Philippines

      Sent an email.

      Reply
  31. Mark

    Hi Lawyers,

    This is a great article. It really gives me an idea.

    I just want to ask your advice regarding to my concern. I am currently planning to buy a land but the owner of the title already died last 2010 or 2011. I already checked on the ROD and verify the title. The ROD personnel informed me that he is the correct owner of the land and their is not issue on it. I went to the BIR to check the real property tax and I found out that they haven’t paid the tax since year 2012. This means that I need to pay it. Now, I also found out that the owner wife is still alive and they have 11 siblings. 2 of the siblings are currently abroad.

    May I know the following answer to the below questions.
    1. May I know if I still need to follow the whole process above in order for me to transfer the title to me?
    2. What will be the process for the 2 siblings that is currently on aborad?
    3. For the Extrajudicial settlement, what will be the process for the 2 siblings that is currently abroad?
    4. For the 2 siblings abroad, do I need to inform them that they need to provide the waiver declaring that they do not want to be part of it or they need to file a waiver that they are going to give up their right to own a property from their parents?
    5. Can you give me further advice or step by step guide on how I can transfer the land to my name?
    6. Can you share the WHOLE complete list of documents that the owner wife to provide to me?

    Looking forward to hear from you.

    Regards
    Mark

    Reply
    • Lawyers in the Philippines

      Hi Mark –

      The extrajudicial settlement process I described above covers most cases.

      If a sale is involved, an extrajudicial settlement with sale is often used.

      All the heirs would need to sign and those abroad would need to participate. The document that those who live abroad must execute must be authenticated; and exact data would depend on which country they live in.

      The list of documents listed above also handles most cases.

      It really depends on the exact situation you find yourself in; there can be differences depending on the exact case facts or documents.

      Reply
      • Mark

        Hi Lawyers.

        Thank you very much for your response. I really appreciate it.

        I would like to get more further clarification from your statement “he document that those who live abroad must execute must be authenticated; and exact data would depend on which country they live in.”.

        What are those documents need to be executed, authenticated? What are the exact data you are referring too?

        Looking forward to hear from you.

      • Lawyers in the Philippines

        Hi Mark:

        There is a process the heirs who live abroad must go through to ensure that the document they execute can be accepted.

        Since your case has some complicating factors, you might want to consult with a legal practitioner at this point.

        Estate is not that easy to settle by yourself and incorrect settlement can cause many problems down the line.

  32. Sherwin

    Hi Lawyers,

    I’m trying to buy a property. It already have a Extra Judicial Settlement, CAR, Estate Tax already paid but the Transfer Certificate of Title is still named to the deceased one.

    What shall I do next? Can we execute a Deed of Absolute Sale with the heirs stated in the Extra Judicial Settlement?

    Please guide me on what are the proper steps to do.

    Thank you very much

    Reply
    • Lawyers in the Philippines

      Sent an email.

      Reply
  33. Valerie

    Hi,

    I just went through your article and find it very helpful. I also want to commend you for actively addressing the queries of your readers.
    I hope you can also enlighten me with my situation as I am already considering on settling the properties that were left by our deceased parents.

    CASE 1: Two properties (lot only) were left by my parents. My mom died December 2003 while my dad died last May 2017.
    Q1: How would the estate tax be computed as the titles were named, (LOT A: Under mom’s name married to dad & LOT B: Under dad’s name married to mom)? As I have read, estate tax will be computed on the time of death of descendent. Will it be subdivided amongst individuals or would it be combined (i.e. 50:50)?
    Q2: Regarding penalties, how are these penalties computed? Will this be computed on the year of the death of my mom or my dad?
    Q3: Are there any grounds by which deductions in estate tax be applied in our case? I’ve read about the standard deduction (1M), is it only applicable for death on or after the passing of TRAIN LAW?
    Q4: Is it better to file both properties as gross estate of both parents? My siblings and I have already settled on who will get the properties. As I am already married, can I already file this under my married name?will it be more difficult? I am also considering on filing for the property that will be given under my name since my siblings are not yet financially capable of settling the properties that they will inherit, is it okay or it would be difficult to do so?

    CASE 2: Another property (family house) is under the name of my mom. However, the lot wherein the property is situated is under the name of my mom and aunt. My aunt is still alive and have children of her own.
    Q1: Do we still have to file for an extrajudicial settlement? if yes, how should we proceed? if not, what are the steps on how we can subdivide the lot for the two families (ours and my aunt’s)

    Thanks in advance

    CASE 2: Another property,

    Reply
    • Lawyers in the Philippines

      Sent you an email.

      Reply
    • Grace

      Wow all what you have said is i got it through all the process and it true very time consuming..but worth it..all u have mention are true..im passing it on to my children so that when i die they will know the process and also my husband whichever ..

      Reply
  34. Mr. Anonymous

    My grandmother died last June 8, 2008. I was not aware that she has 3 BPI Security Corporation accounts consists of a share of stocks which I am the beneficiary ( Naka in trust for under my name yung accounts ). Pero even before when she was still alive, she always tell me na may makukuha daw ako. When she died, she left no will. I was not advised by anyone na beneficiary niya ako for the 3 accounts, hanggang recently na discover ko iyon by myself. Nag punta ako BPI and later on sa BSP para ipa hanap yung accounts. Nahanap ng BPI yung 3 accounts and I already submitted her death certificate, my birth ceritificate and my parents marriage contract sa BPI to prove na ako nga yung beneficiary at wala na grandmother ko. My first question is the bank is asking me to pay the estate tax para daw ma i transfer na sa account ko yung lahat ng shares sa mga 3 accounts na iniwan ng grandmother ko. They are also asking me for a deed of extrajudicial settlement. Ang tanong ko po bakit ko pa po kailangan non? Eh nag iisang beneficiary lang naman po ako nung 3 accounts na yun? Pangalawang question is applicable po ba sa case ko yung Estate Tax amnest of 2019 dahil po 2008 pa namatay lola ko at this year ko lang po na discover yung iniwan niya sa akin at maaasikaso? Ang pagkakaintindi ko po ay ang pag settle ng estates ay pag walang iniwang will or trust yung isang tao. Pero in my case yung 3 accounts po na iyon naka trust at ako po ang beneficiary. Please enlighten me po pangkaraniwang tao lang po ako at wala masyado alam sa mga ganito. Salamat po.

    Reply
    • Lawyers in the Philippines

      Sent an email.

      Reply
  35. Anonymous

    HI Lawyers

    My parents died long time ago and left a piece of land. there are 8 of us siblings and only 1 is benefiting from what is grown in the land.
    But my concern is not the income generated from it but my share of the land. Since my other siblings are no longer interested in dividing the land due to various reasons thus letting them sign the extrajudicial settlement is no longer possible.

    Are there any alternative means, so that i can claim what is rightfully mine which is my share of the land which my parents left us and move on with our lives as this scenario has been the same for decades now.

    Reply
    • Lawyers in the Philippines

      Hi:

      You can have the land subdivided and then sell your share.

      Note this is a long process as well.

      Reply
  36. Cathy

    Hi, I inherited my Dad’s property in Philippines. It was settled extrajudicial and I have a SPA also to my sister in-law. Now, she had a buyer and she’s telling me that I need to do another SPA Self Adjudication as RDO requested this document. I thought DEED of Sale and Extrajudicial are enough to process the sale.

    Reply
    • Lawyers in the Philippines

      Clarify with the RDO.

      This situation is unclear.

      Reply
  37. Josephine

    Good evening.
    Our mother died in 2015. When she was still alive, she sold a property at minimal cost to our eldest with an agreement to her that she would have no more share in the other property, which was agreed and known to all of us siblings. As i have been the ones providing for all expenses to our mother, she told me then and my other siblings that the residential lot area will be left to me, and it would be up to me how much should i pay to my other siblings as their share in the property. I was not so keen before because i have my own residential space nearby..but i just made it clear and was understood by my siblings that the frontside of the property would be my share. Now one of my sister wanted to ‘sell’ to me her share because she badly needs some money. The biggest problem is that this property/estate has not been settled since my mother death…kindly advise me on what instruments and steps should we take at the soonest because my sister needs the money urgently. Thnak you and God Bless

    Reply
    • Lawyers in the Philippines

      Hi Josephine:

      Transferring the property is itemized in the steps above.

      It is important to settle the estste soon as penalties and fees can be heavy.

      Reply
  38. Andy

    Both of my parents are now deceased leaving some real estate properties of excellent current market value, requiring high maintenance costs, taxes, fees, and incidental expenses, to 5 adult legal-age siblings. The properties are deemed unserviceable, if divided into multiple portions. Since, finances can not be collected equitably among the siblings, in some cases not able or willing to provide his/her share of contribution to cover the expenses mentioned. It is now imminent to sell the property while it commands an excellent fair market value, before it incurs more expenses, loss of value, liabilities, and death of any of the siblings. The 4 majority of the siblings are in good faith prefer to put the properties in the market, except for 1 sibling who has been very uncooperative with the idea of selling the property, and has refused to a civilize meeting/communication, via informal intra-family agreement, to settle the issues with an agreement.

    What is the next legal / formal remedy or action for the majority to facilitate the sale of the property and transfer of ownership, when 1 or more co-owner has refused or blocks the sale transaction or threaten to block formal re-titling process?

    Andy

    Reply
    • Lawyers in the Philippines

      Sent an email.

      Reply
  39. Princess

    Hi Lawyers in the Philippines!

    Your article is very informative. I like the way you inform the readers about the topic without being so technical, that everything you write is simple and does not beat around the bush! Hence, I would like to take the opportunity to ask you a question. 🙂 Our family is on its way to settle a property (intestate) however, one of the heirs is already deceased. Do we need to consider writing down his name in extrajudicial or it should be replaced by the surviving spouse, instead? Thank you very much in advance!

    Reply
    • Lawyers in the Philippines

      Hi Princess:

      It depends on what type of heir he is.

      For instance, if the deceased heir is a child of the deceased owner, then his wife and his other heirs must be part of the extrajudicial settlement.

      Reply

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