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Real Estate 101: Acronyms and Terms Commonly Used in the Philippines

House and Lot For Sale - Acronyms and Terms Real Estate Philippines

There are different acronyms and terminologies that you can encounter when checking or buying a real estate property.

To avoid being confused when dealing with a real estate developer or agent, here is a glossary of real estate acronyms and terminology.

Real Estate Acronyms Commonly Used in the Philippines

A

AP – Asking Price

APT – Apartment

ARV – After Repair Value

ATS – Authority to Sell

AV – Appraised Value

B

BIR – Bureau of Internal Revenue

BLLM – Bureau of Lands Location Monument

BR – Bedroom

BSMT – Basement

C

CAR – Certificate Authorizing Registration

CCR – Cash on Cash Return

CCT – Condominium Certificate of Title

CF – Cost Factor

CG – Car Garage

CGT – Capital Gains Tax

CLOA – Certificate of Land Ownership Award

CLOP – Contract of Lease with Option to Purchase

COMP – Comparable

COMM – Commission

CONC – Concrete

COS – Certificate of Sale

CPD – Continuing Professional Development

CR – Comfort Room

CRB – Certified Real estate Broker

CRESR – Comprehensive Real Estate Seminar and Review

CTC – Community Tax Certificate

CTS – Contract-To-Sell

CUSA – Common Use Service Area

CWT – Creditable Withholding Tax

D

DBO – Direct Buyers Only

DOAS – Deed of Absolute Sale

DOR – Deed of Restrictions

DOM – Deed of Mortgage

DP – Down Payment

DR – Door

DST – Documentary Stamps Tax

E

EOP – Exclusive Option to Purchase

EAR – External Appraisal Report 

F

FA – Floor Area

FAR – Floor Area Ratio 

FFE – Furniture, Fixtures, and Equipment

FMV – Fair Market Value

FSBO – For Sale by Owner

G

GF – Ground Floor

GFI – Government Financial Institution

GMTOE – Government-Mandated Taxes and Other Expenses

GSIS – Government Service Insurance System

H

HL – House and Lot

HOA – Homeowners Association

HVAC – Heating Ventilation and Air Conditioning

I

IP-RU – Investment Properties – Retail Units 

ISP – Indicative Selling Price

ITR – Income Tax Return

L

LA – Lot Area

LARES – Land Registration

LOG – Letter of Guarantee

LOI – Letter of Intent

LRA – Land Registration Authority

LTCP – Land Titling Computerization Project

LTS – License to Sell

LTV – Loan to Value

M

MA – Monthly Amortization

MAO – Maximum Allowable Offer

MBP – Minimum Bid Price

MBR – Master Bedroom

MC – Manager’s Check

MGSP – Minimum Gross Selling Price

MLS – Multiple Listing Service

MOA – Memorandum of Agreement

MR – Maids Room

MRI – Mortgage Redemption Insurance

MV – Market Value

N

NOAS – Notice of Approval of Sale

NEOP – Non-Exclusive Option to Purchase

NOI – Net Operating Income

NROC – Non-Refundable Option Consideration

O

OCT – Original Certificate of Title

OP – Over Pricing, Option to Purchase

P

PA – Parking Area

PITI – Principal Interest Taxes and Insurance

PC – Purchase Contract

PD – Presidential Decree

PKS – Product Knowledge Seminar 

POC – Percentage of Completion

PS – Parking Slot

PSM – per square meter

R

RD – Registry of Deeds, Roof Deck

RA – Republic Act

RE – Real Estate

REB – Real Estate Broker

REBAP – Real Estate Brokers Association of the Philippines

REBAP-LMP – REBAP Las Pinas, Muntinlupa, Paranaque

REI – Real Estate Investing

REIT – Real Estate Investment Trust

REM – Real Estate Mortgage

RESA – Real Estate Service Act

REO – Real Estate Owned

RF– Registration Fees

RFO – Ready for Occupancy

RH – Row House

RM – Room

RMO – Revenue Memorandum Order 

ROI – Return on Investment or Return Of Investment

ROPA – Real and Other Properties Acquired

ROPOA – Real and Other Properties Owned or Acquired

ROW – Right of Way

RPT – Real Property Tax

RTO – Rent-To-Own

S

SA – Service Area, Single Attached

SPA – Special Power of Attorney

SQM – Square Meters

T

TRAIN – Tax Reform for Acceleration and Inclusion

TB or T&B – Toilet and Bath

TCP – Total Contract Price

TCT – Transfer Certificate of Title

TH – Town House

TFA – Total Floor Area

TLA – Total Lot Area

TOR – Transfer of Rights

TT – Transfer Tax

U

UA – Usable Area

V

VAT – Value Added Tax

Z

ZV – Zonal Value

Real Estate Terminologies Used in the Philippines

A

ABSTRACT OF TITLE

A record of the property’s title such as transfers, conveyance, and other legal actions that are significant to the title and other assets.

ACCELERATION CLAUSE

A condition in a contract that allows a lender to immediately or demand repayment of the loan in full if certain conditions are not met. 

ACCEPTANCE

An agreement to the offer either expressly or by the policy.

ACCRETION

An increase in land by natural causes or deposits due to moving water of a lake, stream, or the sea.

ACCESSION

The right of the owner to everything created, combined, or connected to a property.

ACKNOWLEDGMENT

Done either in front of a public official or public notary for a declaration or avowal that authenticates legal instruments, documents, acts, or deeds, giving them validity. 

ACQUISITION

The process of getting the ownership or control of a property.

ADMINISTRATOR

Someone who manages the day-to-day operations of real estate offices or a person that arises if the deceased is legally intestate or does not leave any will or if assets are not disposed of by their will.

AD VALOREM

According to valuation.

ADVERSE POSSESSION

Adverse possession is sometimes called squatter’s rights as it is a legal principle that grants title to someone who resides on or owns another person’s land.

AFFIDAVIT

Used when the property is owned by more than one person, or by a trust, and an owner or trustee dies.

AFFIRM

To confirm, to aver, to ratify, to verify.

AGENT

A licensed representative of the developer or owner of the property that processes the buying, selling, and renting of a real estate.

AGREEMENT OF SALE

A written agreement or contract that outlines the terms of a real estate transaction.

AIR RIGHT

Legal ability to occupy the vertical air space above a plot of real estate subject to the requirements of aerial navigations and government regulations.

ALIENATION

Process of voluntarily transferring, giving, or selling the title of the property to another party without restriction.

AMENDMENTS

A document executed or changes made after the contract being accepted.

AMENITIES

Features of the property or developing community such as swimming pools, clubhouses, parks, and security that make it valuable to residents and potential homebuyers.

AMORTIZATION

The schedule of your monthly mortgage loan payments.

APPRAISAL

An estimate of a property’s fair market value based on the location, condition, improvements, renovation potential, and recent sales within the surrounding area. 

APPRECIATION

The increased real estate property’s value over some time.

ARBITRAGE

 An investor purchases a property and sells it for a higher price.

ARBITRATION

 An alternate way to resolve disputes without having to go to court.

ASSIGNMENT

The process of transferring real estate rights or benefits from the assignor to the assignee.

ASSUMPTION OF MORTGAGE

A type of financing arrangement where an outstanding mortgage or loan balance and its terms are transferred from the current owner to a buyer.

ATTORNEY-IN-FACT

Someone who is assigned to act or sign papers and other documents on behalf of another person, whether for business, financial or personal matters.

AUTHORITY TO SELL 

An agreement with a written document that authorizes a real estate agent or broker to sell your property either exclusive or non-exclusive.

AVULSION

 A sudden loss of land due to natural forces such as the action of water.

 

B

BALLOON PAYMENT MORTGAGE

A type of fixed-rate home loan that is short-term usually around five, seven, or 10 years. After the loan period has reached the borrower must make a lump sum or balloon payment of the remaining balance

BARGAIN AND SALE DEED

A type of title deed is often used when a property is transferred under a foreclosure, tax sale, or settlement of the estate of a deceased person.

BASELINE

An imaginary line that stretches from east to west, crossing a principal meridian at a specific point. Surveyors use the baseline as a guide in locating and classifying land under the rectangular survey system of property description.

BENCHMARK

A reference point surveyors determine to calculate differences in elevation. It is also the standard of measurement used to analyze the financial characteristics of a real estate investment property.

BEQUEST

The act of giving or leaving something through a will.

BILATERAL CONTRACT

A transaction with a legal document between a seller and the buyer who both signed the document as evidence of the purchase of a certain property.

BILL OF SALE

A document or certificate that confirms the transfer of a seller’s property ownership to a buyer.

BLANKET MORTGAGE

A single mortgage that covers two or more pieces of property or real estate.

BUYER’S MARKET 

Commonly used to describe conditions in real estate markets wherein there are many properties for sale while there are few buyers. Such conditions might cause the property’s price to go down.\

C

CAPITAL GAINS TAX

A type of tax that is applied to the profits earned from the sale of an asset. The capital gains tax is deducted from the property’s gross selling price or market value.

CONDOMINIUM ACT 

The Condominium Act of the Philippines rules the ownership, rights, and obligations of condominium owners as well as the laws and requirements in the construction of condominiums.

CONJUGAL PROPERTY 

All property and assets a married couple keep whether acquired before or during the marriage.

D

DOCUMENTARY STAMP TAX 

Tax associated when selling and buying a property. The documentary stamp tax rate is 1.5% based on zonal value or the agreed selling price, whichever is higher. Home or lot buyers are the ones who usually pay for Documentary Stamp Tax.

DEED OF SALE

A written document executed under law, wherein a person grants or sold a certain land or property to another person. 

E

EARNEST MONEY 

A form of a security deposit is made in some major transactions such as real estate. Earnest money is deducted during the final sale and may be forfeited if ever the transaction fails.

ESTATE TAX 

tax on the right of the deceased person to transmit his estate to his heirs and beneficiaries at the time of death and on certain transfers, which are made by law as equivalent to testamentary disposition. In the Philippines, the estate tax is being paid by the executor or administrator before the delivery of the distributive share in the inheritance to any heir or beneficiary. 

EXTRA-JUDICIAL SETTLEMENT 

Is a legal and private agreement between the heirs of the deceased person which sets out how the estate of the deceased will be divided or distributed among the lawful heirs.

H

HOME EQUITY

The value of a homeowner’s interest in their home or real property’s current market value.

L

LESSEE 

The person who holds the lease of a property and is often described as a tenant or renter in the Philippines.

M

MACEDA LAW

Republic Act No. 6552 or the Realty Installment Buyer Protection Act. The law is applied to buyers and their right to choose installment as a mode of payment. 

MONTHLY AMORTIZATION 

Payment of the principal loan and interest in regular monthly installments until the end of the loan period.

MONTHLY EQUITY 

Property down payment spread into monthly payments.

MORTGAGE 

A loan is given by financial institutions such as a bank, mortgage company, or government institutions for real estate or residence -primary, secondary, or investment residence.

In the Philippines, you can avail of a mortgage through Pag-Ibig, Bank Financing, Inhouse or Owner Financing, and SSS Housing Loan.

MORTGAGE REDEMPTION INSURANCE 

A form of life insurance that helps to compensate your mortgage balance in the event of your death before the housing loan’s full repayment.

O

OCULAR INSPECTION 

A physical inspection by the Broker before the property will be shown to the buyer.

OFFER TO PURCHASE OR BUY 

A contract specifying the terms, fees that need to be paid by either the seller or buyer, date and time of payment, and agreement where the buyer agrees to buy the property.

P

PRE-SELLING

A legally binding contract to purchase a property before the property is built or developed.

PROFESSIONAL FEE 

Known as commission, it is the income derived from the services rendered by licensed Real Estate Brokers and their Salespersons. The rate usually varies from the agreement of the broker or salesperson and the seller or around five to nine percent for properties sold from developers, and a three to five percent rate for brokerage transactions.

PROPERTY DUE DILIGENCE

Process of checking property before you buy it.

PROPERTY TRIPPING

Home or lot buyer’s physical viewing of the property for sale or rent.

PROPERTY WALKTHROUGH 

A final inspection is done by the buyer to the property before moving in or signing the contract. 

R

READY FOR OCCUPANCY 

Are readily available units or houses where you can move after the complete submission of documents and payments.

REAL ESTATE CONSULTANT 

Registered and licensed real estate professional that provides advice and judgment on the acquisition, enhancement, preservation, utilization, or disposition of lands or improvements and the ones responsible for the conception, planning, management, and development of real estate developments.

REAL ESTATE APPRAISER

Registered and licensed professionals who can estimate a real estate value.

REAL ESTATE ASSESSOR 

Registered and licensed local government employee who performs appraisal and assessment of real properties for tax purposes.

REAL ESTATE BROKER 

Registered and licensed professional that acts as an agent that offers real estate transactions from promotion, negotiation, and selling a property.

REAL ESTATE PROPERTY 

Land along with anything permanently attached to it, water, trees, minerals, buildings, homes, fences, bridges, and anything that is man-made or not. Real estate is a form of real property and differs from personal property or those that are not permanently attached to lands such as vehicles, equipment, furniture, and devices. 

REAL PROPERTY TAX 

 A type of tax calculated by a local government where the property is located and paid by the owner of the property either quarterly or annually. The tax is usually based on the value of the owned property, including land.

S

SQUARE METER 

A measurement of the lot and floor area of a house. 

SURVEYOR

A Geodetic Engineer that conducts land surveys.

T

TOTAL CONTRACT PRICE

The all-in total contract price of the property or the cumulative amount of all monthly purchase amounts owed under a monthly purchase plan, or the total contract price outlined in a lump sum contract.

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