Understanding RA 11057 and Its Effect With NCC and Prior Laws

CREDIT TRANSACTION

PERSONAL PROPERTY SECURITY ACT Understanding RA 11057 11057 and its effect with NCC and prior laws  What may be movable collaterals? Among  Signed August 17 2018 others: 

PURPOSE 

boost credit for micro , small and medium enterprises



creation of a unified, modern and legal

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Deposit accounts



Account receivables

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Negotiable instruments

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Security certificate/ electronic

framework

securities

Which means small store owners or farmers who do not have immovable

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Consumer goods



Livestock and other agricultural

property can now secure loan

products

obligation with movables or nontraditional collaterals (traditional being real property) 

Repeal, amend, or modify: 

Sec 1to 16 of the Chattel Mortgage Law



NCC articles: 

pledge)

Intellectual property rights

Exceptions 



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-

-

2241 ( preference with reference to

2243 (preference as to specific properties and Special preferred credits with respect to movable)



Interest in ships subject to PD 1521

NOTES:

unpaid movables) 

Interest in aircraft which will be subject to RA 497

2140-2141 (Provisions on chattel mortgage)





2127 (provision under REM on accession, improvement and fruits)



Vehicles

2085-2123 ( common provision to pledge an mortgage; contract of







2246-2247 (provisions on preference of credit)

ALGARME DIGEST

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The distinction between pledge and chattel mortgage the right lender to recover deficiency has been removed Implementation is conditioned upon the registry in the Land Registration Authority being established Implementing rules and regulations for the effective implementation will be promulgated by theft Within 6 months of the passage o In case of default, borrowers may opt to put movables for private sale

CREDIT TRANSACTION

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Differences PLEDGE

MORTGAGE

Creation

Delivery of the thing is necessary

Delivery not necessary

Validity

Must be in a public instrument containing description of the thing pledges and the date thereof to bind third person

Must be registered to bind third persons

Foreclosure deficiency/surplus

Liability is extinguished wither there is a defiance or not

Liable to the mortgagee for any deficiency

ALGARME DIGEST

RA 11057 Harmonized where a signed written contract is enough Perfection be it movable/ immovable is harmonized under Sec 12: - Registration of a notice with the registry - Possession of the collateral by the secured creditor - Control of investment property or deposit account Secured creditor (pledgee or mortgagee) shall account to the grantor (pledger/ mortgagor) any surplus, unless otherwise stipulated. Hence grantor is liable for deficiency