1.

Essential Features of Maceda Law

The Essential Features of the Maceda Law are the following:

A. Maceda Law or Republic Act 6552 is an act to provide protection to a buyer of

REAL ESTATE on INSTALLMENT PAYMENTS known as Realty Installment
Buyer Act. It is declared a public policy to protect buyers of real estate on
installment payments against onerous and oppressive conditions. This includes
residential house and condominiums. However there are exemptions on the
Maceda Law coverage. It excludes Industrial lots, Commercial Buildings and Lots,
Sales to tenants under RA 3844 (as amended by RA 6389).

B. The Maceda Laws two important categories:

1. The buyer has paid AT LEAST (2) two years of installments. (Under Section 3
of Maceda Law)
2. The buyer has paid LESS than (2) two years of installments. (Under Section 4
of Maceda Law)

1. The buyer has paid at least (2) two years of installments

a. To pay without additional interest the unpaid installments due within the total grace
period earned. One (1) month grace period for every one year of installment payments
made. The right can only be exercised by the buyer only once in every five years of the
life of the contract.

b. In case of cancellation of contract,

Entitled for a 50% refund of his total payments. If the buyer has paid five years or
more, the buyer is entitled to an increase of 5% every year and so on
However the cash surrender value shall not exceed 90% of his total payments.
This can be done after thirty days from receipt by the buyer of the notice of
cancellation or demand for rescission of the contract by a notarial act.

2. The buyer has paid LESS that two (2) years of installments.
a. The right to pay within a grace period of not less than sixty (60) days from the date
installment became due.
b. Failure to pay the installment due at the expiration of the grace period, the seller
may cancel the contract after 30 days from receipt by the buyer of the notice of
cancellation or demand for rescission of the contract by a notarial act.
 C. Right to Assign / Reinstate Contract (RA 6552 Sec 5)
The buyer has a right to sell or assign his rights to another person or reinstate
the contract by updating the account during the grace period and before the
cancellation of the contract.

D. Right to Advance Payment (RA 6552 Sec 6)

The right to pay in advance any installments or full payment without interest
anytime and have such full payment annotate in the title.

2. Distinguish Maceda Law from Recto

Law?
Recto Law (R) covers installment sales of personal property
Maceda Law (M) governs installment sales of real property

Recto Law (R) comprises Articles 1484 to 1486 of the Civil Code
Maceda Law (M) Republic Act No. 6552, known as the REALTY INSTALLMENT
BUYER PROTECTION ACT

3. Is the Maceda Law applicable to sale of

condominiums?
Yes, as the PRESIDENTIAL DECREE No. 957 (REGULATING THE SALE OF SUBDIVISION
LOTS AND CONDOMINIUMS, PROVIDING PENALTIES FOR VIOLATIONS THEREOF) is
concerned, it states in its Section 24, The rights of the buyer in the event of this failure
to pay the installments due for reasons other than the failure of the owner or developer
to develop the project shall be governed by Republic Act No. 6552.