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Collateral Agreement (Real Estate) for Philippines

Collateral Agreement (Real Estate) Template for Philippines

A comprehensive legal document governed by Philippine law that establishes a security interest in real estate property as collateral for an underlying obligation. The agreement details the rights and obligations of both the collateral provider and the secured party, including property maintenance requirements, default provisions, and enforcement mechanisms. It complies with Philippine civil law requirements for real estate transactions and includes specific provisions for registration with the appropriate property registry offices. The document incorporates necessary safeguards for both parties while ensuring enforceability under Philippine jurisdiction.

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Collateral Agreement (Real Estate)

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What is a Collateral Agreement (Real Estate)?

The Collateral Agreement (Real Estate) is a crucial legal instrument in Philippine secured transactions, used when parties need to establish real property as security for financial obligations. This document type is essential in various financing arrangements, from commercial loans to corporate debt structures, where real estate serves as collateral. The agreement must comply with Philippine civil law requirements, particularly the Civil Code of the Philippines and the Property Registration Decree. It includes detailed property descriptions, representations about ownership, maintenance obligations, and enforcement mechanisms. The document is designed to protect both the collateral provider's and secured party's interests while ensuring the security interest can be properly registered and enforced under Philippine law. Typically used in conjunction with loan agreements or other primary obligations, this agreement forms part of the security package in financing transactions.

What sections should be included in a Collateral Agreement (Real Estate)?

1. Parties: Identification of the parties: the Collateral Provider/Grantor and the Secured Party/Lender, including their complete legal names, addresses, and representative capacities

2. Background: Context of the agreement, including reference to the underlying obligation (e.g., loan agreement) and the purpose of the collateral arrangement

3. Definitions: Definitions of key terms used throughout the agreement, including 'Collateral Property', 'Security Interest', 'Secured Obligations', etc.

4. Grant of Security Interest: Clear statement creating and granting the security interest over the real estate property in favor of the Secured Party

5. Description of Collateral Property: Detailed description of the real estate property including location, boundaries, and title details

6. Secured Obligations: Description of the obligations secured by the collateral, including principal amounts, interest, and other secured liabilities

7. Representations and Warranties: Statements by the Collateral Provider regarding ownership, authority, and condition of the property

8. Covenants: Ongoing obligations of the Collateral Provider regarding maintenance, insurance, taxes, and use of the property

9. Events of Default: Circumstances that constitute default and trigger enforcement rights

10. Enforcement Rights: Rights and remedies of the Secured Party upon default, including foreclosure procedures

11. Registration and Perfection: Requirements and procedures for registering the security interest

12. Governing Law and Jurisdiction: Specification of Philippine law as governing law and jurisdiction for disputes

13. Execution: Signature blocks and notarization requirements

What sections are optional to include in a Collateral Agreement (Real Estate)?

1. Insurance Requirements: Detailed insurance obligations when specific insurance coverage is required beyond standard property insurance

2. Property Management: Specific requirements for property management when the collateral is income-generating real estate

3. Environmental Matters: Environmental representations and obligations when the property has potential environmental risks

4. Further Assurance: Additional undertakings and requirements when enhanced security or documentation might be needed

5. Cross-Collateralization: Provisions linking the collateral to other obligations when multiple loans are secured

6. Release Provisions: Specific conditions and procedures for releasing the security when partial releases might be contemplated

7. Leasing Restrictions: Restrictions on leasing the property when the secured party wants control over tenant relationships

8. Substitution Rights: Rights to substitute collateral when such flexibility might be needed

What schedules should be included in a Collateral Agreement (Real Estate)?

1. Property Description Schedule: Detailed technical description of the property, including metes and bounds, tax declaration numbers, and title details

2. Title Documents: Copies of property titles, tax declarations, and other ownership documents

3. Secured Obligations Schedule: Detailed list of all secured obligations, including payment schedules and interest calculations

4. Insurance Certificates: Copies of required insurance policies and certificates

5. Property Valuation: Professional appraisal report or valuation of the property

6. Corporate Authorizations: Corporate resolutions and authorizations if parties are corporations

7. Registration Requirements: List of documents required for registering the security interest

8. Existing Encumbrances: List of any existing liens, encumbrances, or restrictions on the property

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Philippines

Publisher

Ƶ

Cost

Free to use
Relevant legal definitions






























Clauses






























Relevant Industries

Banking & Financial Services

Real Estate

Legal Services

Insurance

Construction & Development

Property Management

Commercial Lending

Mortgage Services

Corporate Finance

Asset Management

Relevant Teams

Legal

Real Estate

Credit Risk

Compliance

Corporate Secretariat

Loan Operations

Property Management

Risk Assessment

Documentation

Corporate Finance

Relevant Roles

Legal Counsel

Real Estate Manager

Credit Risk Officer

Loan Officer

Property Manager

Compliance Officer

Corporate Secretary

Real Estate Attorney

Banking Operations Manager

Collateral Manager

Risk Assessment Officer

Transaction Manager

Real Estate Development Director

Chief Legal Officer

Security Documentation Specialist

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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