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PRESIDENTIAL DECREE NO. 1817
PRESIDENTIAL DECREE NO. 1817 -
AMENDING Section SIXTY TWO OF REPUBLIC ACT NUMBERED THREE THOUSAND
EIGHT HUNDRED FORTY-FOUR, AS AMENDED, OTHERWISE KNOWN AS THE CODE OF
AGRARIAN REFORMS OF THE PHILIPPINES
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WHEREAS,
the farmer-beneficiary who has fully paid the cost of his farm and/or
homelots to the Land Bank of the Philippines under Section Sixty-two of
Republic Act Numbered Three Thousand Eight Hundred and Forty-Four, is
legally enjoined from using said property as collateral for loans to be
obtained from public or private lending institutions:cralaw:red
WHEREAS, under the existing provision, a farmer-beneficiary who is
still amortizing the cost of his land is better situated than a
beneficiary who has already paid in full the cost of the land for being
given an opportunity to secure loans and credit assistance thru the use
of the Certificate of Land Transfer (CLT) as collateral;chanroblesvirtualawlibrary
WHEREAS, the operative effects of such provision, besides being
iniquitous on the part of the farmer-beneficiary who has fully paid for
his land, could lead to a situation where a farmer beneficiary would
defer the full payment of the purchase price if only to enable him to
use his landholdings as collateral for any loan that he intends to
obtain thereby.
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines,
by virtue of the powers in me vested by the Constitution, do hereby
order and decree;chanroblesvirtualawlibrary
Section 1. Section Sixty-two of Republic Act Numbered
Three Thousand Eight Hundred and Forty-four, as amended, otherwise
known as the Code of Agrarian Reform of the Philippines, is hereby
amended to read as follows: chanroblesvirtualawlibrary
"Sec. 62. Limitation of Land Rights. — Except in
hereditary succession by one heir, landholding acquired under this Code
shall not be sold or transferred except in favor of the Government,
valued at its acquisition cost plus cost of improvements. Said
landholding may be mortgaged or encumbered in favor of any financing or
banking institution up to the original cost of acquisition thereof to
be guaranteed by the Samahang Nayon or duly recognized farmers
cooperative where the farmer is a full-pledged member; Provided, That
in case of default, the loan becomes immediately due and demandable and
the mortgagor is given a grace period of one year within which to
settle his obligation: Provided, Further, That in case of non-payment
within one year grace period, the landholding shall be disposed of only
in favor of the Government which shall endeavor to substitute the
defaulting farmer-beneficiary preferable with a new one who does not
own any land duly certified by the Ministry of Agrarian Reform and who
shall be subrogated to the rights and shall assume the obligations of
the replaced farmer-beneficiary, subject, however, to the preferential,
right of first refusal of the other heirs of the latter: Provided,
Further, That a purchaser who acquired his landholding under a contract
to sell from Land Bank, or has been issued an Order of Award, may also
secure a loan from any financing or banking institution in an amount
not exceeding his equity on said landholding. chanroblesvirtualawlibrary
Section 2. This Act shall take effect upon its
approval.
Done in the City of Manila,
this 16th day of January, in the year of Our Lord, nineteen hundred and
eighty-one.
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