Open Deed Of Sale: Don’t Get In Troubles Because You Haven’t Transferred OwnershipMay 10, 2021
The reason why you need to know about the deed of sale is that it decides whether the transaction will be quick and smooth or troublesome. The deed of sale is a type of document involved when a second-hand car is put on sale. So, what does “open deed of sale” mean? Today, Onroadtips will help you understand this term and the related process thoroughly.
What is deed of sale?
It’s a legal, binding document that proves both the seller and the buyer have agreed on the purchase or sale of an immovable property.
The deed of sale must show the vehicle’s details like make, type of body, model, color, plate number, as well as engine number. This information goes along with the seller’s details including full name, address, marital status, and the selling price of the vehicle. Apart from that, there should be the information about the buyer and both parties must sign the deed of sale, which must be notorarized by a lawyer.
Open deed of sale motor vehicle
So, what is open deed of sale? The law requires buyers to register the vehicle at the LTO once its ownership is shifted. Nevertheless, there is a practice where the buyer’s details are left blank. This is an open deed of sale.
In the car market, this practice is useful for sellers by helping them avoid spending time and money registering a vehicle just to sell it a short time later.
However, you should not buy or sell a car if it comes with an open deed of sale. While this document acts as a binding contract between the seller and the buyer, the vehicle will remains in the legal onwership of the seller untill the buyer registers it under their own name. This means, the seller has to take responsibilities if the buyer’s involved in any accident or similar cases.
As for the buyer, settling the deed of sale as soon as they can will give them the complete ownership of the vehicle. This way, they can avoid future problems like searching for the previous owner.
So, there’s no point in keeping an open deed of sale for car, you should just transfer the ownership as soon as you can.
Transfer the ownership
To transfer the ownership of the car from the seller to the buyer, you must visit an LTO brand, which should be done as soon as the car is given to the buyer. Keep in mind that the required documents include:
- Original OR and CR
- A clearance from the Philippine National Police – Highway Patrol Group
- Original deed of sale
- Your Tax Identification Number
- A copy of insurance details of the car
- Accomplished and approved MVIR (Motor Vehicle Inspection Report)
The owner’s responsibilities
According to the Land Transportation and Traffic code, the owner of a motor vehicle is the one whose name is written on the registration papers issued by the LTO. The owner has to be responsible for the vehicle if it’s involved in an accident even when the driver is another person.
This rule helps the police in case the vehicle involved in the accident is controlled by an unidentifiable person. This also makes sure someone is always responsible for the victim’s damage.
On the other hand, when the driver has been identified, the owner of the vehicle won’t have to be liable unless it’s the vehicle’s part that causes the accident.
It’s worth noting that this regulation applies to all other cases, including tiny ones like a parking violation.
All in all, this post has explained all you need to know about the open deed of sale for cars. We hope that through this information, you will be able to avoid troubles related to the paperwork of the selling and purchase process.