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Deed of Assignment of Receivables with Recourse

NHMFC template for deed of assignment of receivables with recourse

Your Browser Doesn't Support Canvas. Showing the Text Content of the PDF Instead: DEED OF ASSIGNMENT OF RECEIVABLES WITH RECOURSE
KNOW ALL MEN BY THESE PRESENTS:
This Deed of Assignment of Receivables with Recourse executed by and between:

Click here to enter text. , a corporation duly organized and
existing under Philippine laws, with principal place of business at
Click here to enter text. and herein represented by Click here to
enter text., who is duly authorized for this purpose (as evidenced
by the Secretary’s Certificate/Board Resolution attached as
ANNEX “A”), hereinafter referred to as "DEVELOPER";
-andNATIONAL HOME MORTGAGE FINANCE CORPORATION
("NHMFC"), a government owned and controlled corporation,
created and organized by virtue of P.D. No. 1267 dated December
21, 1977, with principal office at Filomena Building III, 104
Amorsolo Street, Legaspi Village, Makati City, and herein
represented by its President Felixberto U. Bustos, Jr., duly
authorized for this purpose (as evidenced by the Secretary’s
Certificate/Board Resolution attached as ANNEX “B”).
WITNESSETH THAT:
WHEREAS, the DEVELOPER is engaged in the business of developing real estate/
subdivision projects;
WHEREAS, the DEVELOPER is the absolute and registered owner of parcels of land
which it has developed as a subdivision/condominium project located at Click here to enter
text.;
WHEREAS, the house and lot/condominium unit (hereinafter, "Property") located at

Click here to enter text., with an area of Click here to enter text. square meters ( ___ sq. m.) with
unit design Click here to enter text. has been sold on installments by the DEVELOPER to Click
here to enter text. (hereinafter referred to as the "BUYER");
WHEREAS, the DEVELOPER has executed a Contract to Sell (hereinafter, "CTS") over
the above Property in favor of the BUYER (a copy of which is herein attached and referred to as
Annex "C"), wherein the BUYER has paid down payments equivalent to Click here to enter text.
(PhpClick here to enter text.), and agreed to pay equal monthly amortizations in the amount of
Click here to enter text. (PhpClick here to enter text.) for a period of Click here to enter text.
(_____) years;
WHEREAS, the DEVELOPER has exercised due diligence in determining the financial
capacity of the BUYER to pay the amortizations for the property purchased, as they fall due;
WHEREAS, the BUYER has agreed in writing that the DEVELOPER may sell, deliver
and assign all the latter's rights, interests and participation in the CTS/loan receivables
covered by the CTS to any third person, whether natural or juridical;
WHEREAS, the DEVELOPER intends to avail of NHMFC’s Housing Loan Receivables
Purchase Program (HLRPP) and thereunder assign to NHMFC the remaining loan receivables
covered by the subject CTS, in accordance with NHMFC’s criteria, the HLRPP Guidelines,
requirements and terms and conditions, and subject to applicable laws, rules and regulations;
WHEREAS, the DEVELOPER intends to assign to NHMFC the remaining loan
receivables under the subject CTS, in the amount of Click here to enter text. (Php Click here to
enter text.), which represents the Outstanding Principal Balance (OPB) as of cut-off date;
WHEREAS, NHMFC is willing to purchase the subject loan receivables with recourse as
against the DEVELOPER in the event that the BUYER fails to comply with his/her obligations
under the CTS; and,
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NOW THEREFORE, for and in consideration of the amount of Click here to enter text.
(Php Click here to enter text.), which represents the OPB as of the cut-off date agreed upon by
the parties (which is month/date/year), the DEVELOPER hereby delivers and transfers to
NHMFC the receivables covered by the CTS and all other supporting documents required under
the HLRPP Guidelines.
The parties further agree, as follows:
1. The DEVELOPER agrees that NHMFC shall pay the amount equivalent to the Purchase
Price of the CTS Portfolio upon assignment of the corresponding CTS/loan receivables and
compliance with the NHMFC HLRPP Guidelines and requirements;
2. The DEVELOPER agrees that the proceeds of the purchased loan/s will be released to it
after submission to NHMFC of, and full compliance with, all requirements as stipulated
under the HLRPP Guidelines and this agreement and after passing the underwriting criteria
and standards of NHMFC;
3. The DEVELOPER agrees and undertakes to shoulder the costs and expenses of registration
and annotation on the TCT/CCT of this Deed of Assignment of Receivables with Recourse
(DARR) in the Register of Deeds exercising jurisdiction over the location of the Property, as
well as, all other costs and expenses of documentation and notarization relative to this
Deed;
4. The DEVELOPER agrees to pay any and all tax assessments, real estate taxes and other
fees and charges on the Property covered by the subject CTS even after the effectivity of this
agreement, as well as, those fees, taxes and other expenses arising from or incidental with
the execution or registration of the agreements;
5. The DEVELOPER hereby warrants that:
a. The BUYER in the subject CTS has the financial capability to pay his/her monthly
amortizations as they fall due;
b. It has exercised due diligence in determining the qualification, financial capacity
and willingness to pay of the BUYER;
c. It is a duly-licensed DEVELOPER and the subdivision project where the unit subject
of the CTS forms part, is duly registered;
d. It has the technical know-how and has exercised proper diligence in the verification
of the title/ownership over the Property involved and that the title/document of
ownership, from which it derives its title contains no vitiating defects which could
have been found or discovered with the exercise of proper diligence and technical
skill;
e. The title of the property subject of the CTS is in the name of the DEVELOPER, and
is free from any lien and/or encumbrance; the subject CTS is legal, valid and
binding; and, the consent of the parties therein were not vitiated or secured by
fraud;
f.

The housing unit covered by the subject CTS has no structural defects and the
materials used in the construction thereof have passed the standards set forth by
appropriate agencies;

g. The land where the housing unit is constructed is free from hidden defects and is fit
for the use for which it was intended;
h. The land where the housing unit is constructed is free from any defect that may
arise from the development thereof, and is developed in accordance with existing
government standards;
i.

Under the subject CTS, the DEVELOPER is authorized by the BUYER to, at any
time, unilaterally assign, cede or transfer his/her CTS rights/receivables from the
BUYER, to any third party, without need of any notice and without incurring any
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liability thereon; and,
j.

The BUYER and the Property covered under the subject CTS are adequately insured
under existing Life/Sales Redemption Insurance (SRI) and Fire and Lightning
Insurance, which are required of the BUYER under the subject CTS;

In this connection, the DEVELOPER thru its duly authorized representative, has
executed an Affidavit of Warranties, which is attached as Annex "D" and made an integral part
hereof.
6. The DEVELOPER hereby agrees and undertakes, within thirty (30) days from receipt of
NHMFC’s notification, to buy-back the affected/defective CTS/loan from NHMFC or to
replace/substitute the same with an equally qualified CTS/loan acceptable to NHMFC,
whichever is required by NHMFC at its sole option, in case of any defaulting loan or
defective CTS (as set forth in items a-c below) and/or under any of the following
circumstances:
a. Failure of the BUYER to pay his/her monthly amortizations for three
(3) consecutive months as stipulated in the CTS (inclusive of the two
[2] months grace period under Sec. 4, R.A. No. 6552, in which case
he/ she is considered in default;
b. In case of a structural defect, or a case is brought by the BUYER
against the DEVELOPER before any judicial/quasi-judicial agency for
alleged structural defects;
c. A decision from a court of competent jurisdiction is issued declaring
the title/collateral covered by the CTS as defective, and/or declaring
the CTS as null and void;
d. In the event the DEVELOPER and/or BUYER mortgages or puts up
the subject Property as security for a real estate loan, or in any way
constitutes a lien and/or an encumbrance thereon, after assignment
of the CTS to NHMFC and/or within the time when the buyer is
making the installment payments on the subject property;
e. In the event the buyer obtains financing/refinancing from a bank or
any other financial institution;
f.

In the event of sale, assignment, transfer, conveyance, cession,
encumbrance of the rights, interests, and/or obligations under the
subject CTS, by the BUYER to a third person;

g. If at any time before full payment by the BUYER of the total contract
price and all other obligations arising from the subject CTS, the
government or any of its agencies or instrumentalities, or any public
utility, expropriates the Property or any portion thereof;
h. In case the Property covered by the subject CTS is subject to tax
foreclosure;
i.

In the event the subject Contract to Sell is not converted to Real
Estate Mortgage (REM) within two (2) years from assignment thereof to
NHMFC;

j.

In case of rescission or cancellation of the subject CTS; and,

k. Any other event/circumstance that renders the CTS defective and/or
subject to buy back by the DEVELOPER.
8. The DEVELOPER agrees and undertakes to hold NHMFC free and harmless from any and
all liabilities arising from Republic Act No. 6552, otherwise known as the Maceda Law, in
case of cancellation of the CTS for non-payment and/or violation by the BUYER of any
provision of the CTS;
9. The parties agree that the DEVELOPER, at its own expense, shall commit to answer for any
defects on land development and house construction (except that caused by wear and tear),
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to meet the specifications set by the Housing and Land Use Regulatory Board (HLURB),
without prejudice to the provisions of Article 1723 of the Civil Code of the Philippines;
10. The parties agree that in case of default, non-payment and/or violation of any provision in
the CTS by the borrower which would give the DEVELOPER the right to rescind or cancel
the CTS, the DEVELOPER shall notify the NHMFC within five (5) days prior to the actual
cancellation/rescission of the CTS concerned;
11. The DEVELOPER agrees to cause the change of beneficiary under the Sales Redemption
Insurance (SRI) and Fire and Lightning Insurance policies, to the NHMFC in lieu of the
DEVELOPER, immediately upon assignment of the subject CTS to NHMFC. However in case
any of the peril/risks insured against occurs before such change of beneficiary takes effect,
the DEVELOPER undertakes to assign all insurance proceeds thereon to NHMFC;
12. The DEVELOPER agrees, when required by NHMFC, to submit in favor of NHMFC,
additional securities/collateral to cover defaults, defects or deficiencies which may arise
from the originated CTS/loan;
13. The DEVELOPER agrees and undertakes to convert the subject CTS into a Real Estate
Mortgage (REM) Contract within two (2) years from execution of this agreement, and cause
the annotation thereof in the TCTs/CCTs of the subject Property, all at their own
cost/expense;
14. The parties agree that NHMFC shall be entitled to hold out/retain 10% of the corresponding
price/consideration under this agreement, to cover for the costs/expenses of conversion of
such CTS into a REM contract and the registration and annotation thereof in the
corresponding TCT/CCT;
15. The parties agree that in case the DEVELOPER breaches any of the
warranties/undertakings herein stated with respect to the subject CTS, NHMFC shall,
without prejudice to other legal remedies, have the right of recourse against the
DEVELOPER, for the OPB of the loans under CTS, including accrued interests and charges
thereon, together with a three percent (3%) surcharge on the aggregate amount due. Failure
to pay such amount due within fifteen (15) days from demand shall subject the
DEVELOPER to a penalty of one tenth of one percent (1/10 of 1%) thereon per day of delay
in addition to the regular interest, penalties and other charges on the loan;
16. The parties agree that NHMFC shall have the right of recourse against the DEVELOPER, in
case of breach of any of the warranties stipulated with respect to any of the CTS purchased,
breach of any provision of this agreement, failure to assign a new borrower or failure to
buy back the defective/defaulting/non-performing loans. In the event the NHMFC exercises
its right of recourse, the DEVELOPER shall reimburse to the NHMFC the full amount
previously released by the NHMFC to the DEVELOPER plus a penalty of three percent (3%)
per month computed on a daily basis for every day of delay reckoned from the date the said
right accrued upon demand;
17. The parties agree that in case the DEVELOPER fails to pay/remit to NHMFC its loan
obligations when due, it shall be liable to pay a penalty of one-fifteenth of one percent (1/15
of 1%) of any unpaid amounts for each day of delay;
18. The parties agree that NHMFC requires the issuance by the Buyer/Borrower of 25 Postdated checks payable to/in favor of NHMFC to cover the monthly amortizations in the CTS
for the first twenty four (24) months from take-out date and (in the 25th check) the
remaining outstanding balance/s. This arrangement shall continue until the loans are fully
paid. Failure of the Buyer to pay/remit its CTS/loan obligations to NHMFC shall result to
an automatic interest rate increase of two percent (2%), applied to the principal portion of
the arrears;
19. The parties agree that the DEVELOPER shall be considered in default, among other
instances as stipulated in this DARR, where the check issued was Drawn Against
Insufficient Funds (DAIF) or any other similar instances where NHMFC cannot collect from
any of the issued checks. In the event of default, the outstanding CTS/loan balance, all
accrued interests, fees, charges and penalties shall become due and demandable from the
DEVELOPER and shall be ground for the DEVELOPER to be blacklisted in NHMFC's roster
of originators;
20. The parties agree that the DEVELOPER's penalties, surcharges and other liabilities under
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this agreement may be taken/deducted from any of its funds/checks which may be in the
possession of NHMFC;
21. The DEVELOPER warrants that it has read, and hereby agrees to abide by, NHMFC’s
HLRPP Guidelines and requirements, including any and all supplementary circulars and
amendments thereto;
22. All documents (including CTS, Application Form, Appraisal Report, Certification of House
and Lot Acceptance, Certificate of Completion and other papers) submitted in connection
with this agreement are made integral parts hereof and any violation thereof or
misrepresentation therein shall constitute an event of default;
23. This agreement shall be effective upon execution thereof, subject to review by the
Commission on Audit (COA) and other proper government authorities and whatever
addition, deletion and amendment that may be suggested by the latter, which shall be
binding and effective and shall form part of this agreement;
24. The DEVELOPER cannot assign or transfer its rights, obligations or interest in this
agreement or any portion hereof (or related agreements) without the prior written consent of
NHMFC;
25. The failure of NHMFC to insist upon a strict performance of any of the terms and conditions
of this agreement or any related agreements (hereinafter, collectively, "Agreement") shall not
be deemed a relinquishment or waiver of any right or remedy that it may have against the
DEVELOPER, or of any subsequent breach or default by the DEVELOPER of the terms and
conditions of the Agreement. No waiver by NHMFC of any of its rights/remedies under the
Agreement shall be deemed to have been made, unless expressed in writing and signed by
its duly authorized representative in this Deed. Any waiver by NHMFC of any breach of any
provision of the Agreement shall not be construed as a waiver of any continuing or
succeeding breach of such provision, a waiver of such provision or a waiver of any right
under the Agreement;
26. No waiver, amendment, alteration or modification of this agreement or any agreement in
connection herewith shall be valid unless in writing and duly executed by the duly
authorized representative of the parties in this Deed; and,
27. Any legal action that may arise by reason of, or in connection with this agreement shall be
brought in the proper courts of Makati City to the exclusion of all other venues.
IN WITNESS WHEREOF, the parties hereby enter into this agreement on this Click

here to enter text. day of Click here to enter text., Makati City.

(Developer)

NATIONAL HOME MORTGAGE FINANCE
CORPORATION
By:

By:

(AUTHORIZED REPRESENTATIVE)
President

FELIXBERTO U. BUSTOS, JR.
President

SIGNED IN THE PRESENCE OF:
____________________________________
(Signature over printed name)

_____________________________________
(Signature over printed name)

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ACKNOWLEDGMENT
REPUBLIC OF THE PHILIPPINES)
_________________________________) S.S.
BEFORE ME, a Notary Public for and in ____________________, on this __th day of
___________, 20__, personally appeared the following:
Name
(Authorized representative)
Felixberto U. Bustos, Jr.

Competent Proof of Identity
__________________________
________________________

Issued on/at; Valid until
___________________________
___________________________

known to me to be the same persons who executed the foregoing instrument consisting of _____
(__) pages including this page where the Acknowledgement is written, which has been signed by
the parties and their witnesses on the left hand margin of every page and on the signature
page. The parties/signatories acknowledged that the same constitutes their own free and
voluntary act and deed and that of the corporations represented.
WITNESS MY HAND AND SEAL, on the date and at the place first above written.

Doc. No. ______;
Page No. ______;
Book No.______;
Series of 20 ___.

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