What Is a Deed of Sale? Philippine Definition, Types, and Notarization Requirements
A Deed of Sale is a notarized document by which a seller transfers ownership of property to a buyer in exchange for a price. In the Philippines, deeds of sale are required for transferring real property, vehicles, and other significant assets, and must be notarized to be registrable with the Registry of Deeds, the LTO, or other registries.
Types of Deeds of Sale
| Type | Function |
|---|---|
| Deed of Absolute Sale | Outright, unconditional transfer of ownership upon execution |
| Conditional Deed of Sale | Transfer subject to conditions (typically full payment) |
| Contract to Sell | Promise to sell once conditions are met – ownership stays with the seller until then |
| Deed of Sale with Assumption of Mortgage | Buyer assumes the seller’s existing loan |
| Deed of Sale of Motor Vehicle | LTO-required form for vehicle transfer |
| Deed of Sale of Shares of Stock | Transfer of corporate shares |
The most common in residential real estate is the Deed of Absolute Sale, executed once the buyer has paid the full purchase price.
Why Deeds of Sale Must Be Notarized
A Deed of Sale must be notarized via acknowledgment for several reasons:
- Registrability – The Registry of Deeds will not register a transfer without a notarized deed
- Tax filing – The BIR requires the notarized deed for capital gains tax (CGT) and documentary stamp tax (DST) computation
- Public document status – A notarized deed becomes a public document and is admissible as evidence without further authentication under the Rules of Court
- Evidentiary weight – Resists later challenges by the parties
An unnotarized deed is binding between the seller and buyer as a contract but cannot be used to transfer title.
Standard Components
A complete Philippine Deed of Absolute Sale typically includes:
- Parties – full names, civil status, citizenship, addresses, competent evidence of identity
- Spousal consent – if the property is conjugal or community property
- Property description – TCT/CCT number, location, technical description
- Consideration – purchase price, payment terms, receipt
- Warranties – of title, against eviction, against hidden defects
- Tax allocations – who pays CGT, DST, transfer tax, registration fees
- Notarial acknowledgment
The Traditional Closing Process
- Draft the deed
- Coordinate physical signing of buyer, seller, and spouses
- Notarize the deed before a notary public
- Pay CGT and DST at the BIR within 30 days
- Pay transfer tax at the LGU
- Submit notarized deed and BIR clearances to the Registry of Deeds
- Wait for the new TCT/CCT in the buyer’s name
A typical residential closing can take several weeks because each step depends on the previous one being completed and physically delivered.
Deeds of Sale Under E-Notarization
Under A.M. No. 24-10-14-SC, Deeds of Sale can be notarized electronically through an SC-accredited ENF. The seller, buyer, and spouses (if any) appear before an electronic notary public – in person (IEN) or by videoconference (REN) – and execute the deed digitally. The certified PDF, sealed with an electronic notarial seal, is ready to submit to the BIR and Registry of Deeds the same day.
For real estate teams handling deeds at volume, see E-Notarization for Real Estate Brokers and Developers.
Common Mistakes
- Missing spousal consent for conjugal or community property
- Inaccurate or outdated TCT/CCT details
- Wrong notarial act – using a jurat instead of an acknowledgment
- Failing to notarize before BIR filing deadlines
- Incomplete competent evidence of identity for OFW sellers (often resolved by REN instead of consularization)
Related Terms
NotarialOS is a leading SC-accredited Electronic Notarization Facility – execute and notarize Philippine deeds of sale without the notary run.