Overview

Buyers who cancel a condominium purchase in the Philippines often ask whether the amounts they have already paid—reservation fees, down payments, and monthly amortizations—can be “transferred” or “reapplied” to a different project by the same developer. The short answer is: there is no automatic legal right to transfer payments, but it may be allowed by contract or developer policy, and the outcome depends heavily on (1) the reason for cancellation, (2) the stage of the sale, (3) the contract terms, and (4) how the developer chooses to handle your request within the limits of Philippine law.

This article explains the governing laws, the kinds of payments involved, what happens in different cancellation scenarios, how transfers are typically handled in practice, and what buyers can do to maximize their chances.

Key Philippine Laws and Rules That Control the Issue

1. The Maceda Law (RA 6552) — “Realty Installment Buyer Protection Act”

The Maceda Law protects buyers who purchase real estate on installment, including condo units, except for industrial lots, commercial buildings sold to corporations for business use, and certain bank foreclosure sales. It creates buyer rights when you default or cancel after paying installments.

Why it matters here: The Maceda Law talks about refunds, grace periods, and cancellations—not transfers. So if you cancel, the law frames the remedy as a refund or forfeiture, not credit-transfer. Any transfer is extra-contractual unless your contract allows it.

Main Maceda Law benefits:

If you’ve paid less than 2 years of installments:
- You get a grace period of at least 60 days from due date to pay without interest.
- If you still cancel or default after grace period, the developer may cancel and forfeit payments, subject to notice requirements.
If you’ve paid at least 2 years:
- You get a grace period of 1 month per year paid, minimum 60 days.
- If cancelled, you are entitled to a cash surrender value refund of 50% of total payments, plus 5% more per year after 5 years, up to 90%.

Transfer angle: Maceda gives refund rights. A developer may offer a transfer instead of a refund, but that is typically by agreement, not a statutory obligation.

2. PD 957 — Condominium and Subdivision Buyers’ Protective Decree

PD 957 governs condo and subdivision sales and imposes duties on developers regarding:

Advertising truthfulness
Contract fairness
Completion standards
Refunds if the developer fails to deliver or violates approval rules
License to Sell requirements

Why it matters here: If the developer is at fault (e.g., delays, failure to deliver, misrepresentation, or lack of License to Sell), PD 957 strengthens your refund or rescission rights. Like Maceda, PD 957 does not mandate transfers, but it increases your leverage to negotiate one.

3. HLURB/DHSUD Rules and Contract-to-Sell Framework

Most condo purchases are through a Contract to Sell (CTS) rather than a Deed of Absolute Sale. Under a CTS:

Ownership does not transfer until full payment.
The developer retains rights to cancel under conditions.
Refunds/forfeitures depend on Maceda/PD957 and your CTS terms.

DHSUD (successor of HLURB) regulations generally require:

Proper notice for cancellation
Clear disclosure of refund/forfeiture rules
Fair dealing

Again, transfer is not required by regulation unless stated in your CTS or a separate policy.

4. Civil Code and Contract Law

Even outside special laws:

Contracts are binding (Art. 1159, Civil Code).
Parties can modify obligations by mutual agreement (novation).
Unfair, unconscionable, or illegal stipulations may be void.

If your CTS expressly allows “reapplication,” “conversion,” or “transfer” to another unit/project, then you can enforce that clause. If not, you need developer consent for any transfer.

What “Transfer of Payments” Usually Means

Buyers use “transfer” in different ways. It’s crucial to separate these:

Transfer / Reapplication of Paid Amounts as Credit
- Developer treats your paid amounts as partial payment for another project/unit.
- Often subject to admin fees, price differences, or loss of certain amounts.
Unit Substitution within the Same Project
- Move to another unit (bigger/smaller/floor) in the same development.
- More commonly allowed since it’s within the same license to sell and fund structure.
Contract Novation to a Different Project
- Cancels the old CTS and issues a new CTS.
- Treated as a new sale; developer decides whether to carry forward payments.
Refund then New Purchase
- You receive refund under Maceda/PD957, then purchase another project separately.
- Legally clean, but slower and may reduce your cash-on-hand advantage.

Scenario-by-Scenario Legal Outcomes

Scenario A: Buyer Cancels Voluntarily (Change of Mind / Financial Trouble)

This is the most common. The default legal framework is Maceda + CTS.

Less than 2 years paid:
- You typically lose most of what you paid after grace period and proper notice.
- Developer is not legally required to transfer credits.
- Any transfer depends purely on developer goodwill/policy.
At least 2 years paid:
- You are entitled to cash surrender value refund.
- Developer may offer a transfer instead of cash, often framed as a “buyer-friendly option.”
- You can insist on the refund, but you cannot insist on transfer unless contract says so.

Practical note: Developers sometimes prefer “transfer” because it keeps cash in-house. But they will insert conditions: admin fees, updated pricing, or forfeiture of reservation fee.

Scenario B: Buyer Defaults but Wants to Move to Another Project

This is still treated as buyer-side cancellation. You can request:

Restructuring of payments, or
Reapplication of paid sums to a cheaper unit/project.

Legally, your baseline rights = grace periods and possible refund if ≥2 years. Transfer remains voluntary for the developer unless contractually promised.

Scenario C: Developer is at Fault (Delay / Failure to Deliver / Misrepresentation)

If the developer breaches PD 957 or contract obligations, you have stronger remedies:

Rescission with refund (often full refund depending on fault and decision).
Possible damages.
Administrative complaints before DHSUD.

Transfer angle: Because the developer is on weaker legal footing, you are in a better negotiating position to demand either:

Full refund, or
Transfer with full credit and minimal penalties.

Still, transfer is not automatically mandated—your legal right is to rescind/refund, then you may choose to buy elsewhere. But developers often agree to transfer to avoid disputes.

Scenario D: Project Cancellation / No License to Sell / Project Not Viable

If the project itself is cancelled or illegally sold:

Buyers can demand refunds and report to DHSUD.
Developers have little justification to forfeit.

A transfer arrangement can happen if both parties agree, but you should be careful:

Ensure the new project has a valid License to Sell.
Make sure your credit is documented, not just verbal.

Reservation Fees, Down Payments, and Installments: Can They Be Reapplied?

1. Reservation Fee

Often labeled non-refundable in documents.
In practice, some developers allow reapplication as a courtesy if you buy another unit quickly.
Legally, its fate depends on:
- The reservation agreement wording, and
- Whether the fee is treated as part of total payments under Maceda.

Typical outcome: Reservation fees are the most likely to be forfeited, and the least likely to be fully transferred unless you negotiate early and politely.

2. Down Payments / Monthly Installments

These are usually counted as “installments” under Maceda.
If ≥2 years paid, you have a clear refund right.

Typical transfer policies (not legal rules):

Full credit of net payments minus penalties/admin fees.
Credit only for installments, excluding reservation fee.
Credit subject to price re-computation at current market rates.

3. Bank Loan / Financing Stage Payments

If you already moved to bank financing:

Bank and developer roles separate.
Any “transfer” becomes more complex:
- You may need to pre-terminate loan or refinance.
- Developer can’t just shift a bank-funded contract without lender involvement.

Legally, this is almost never an automatic transfer situation. It is a new sale + separate loan arrangement.

What Your Contract to Sell Usually Says

Look for clauses on:

Cancellation/Default
Forfeiture of payments
Maceda Law compliance
Substitution or upgrade/downgrade
Reapplication of payments / conversion

Common CTS patterns:

“Payments forfeited upon cancellation” (subject to Maceda)
“Developer may allow transfer at its sole discretion”
“Reservation fee non-refundable and non-transferable”
“No transfer without written consent”

If your CTS uses words like “may allow,” “at discretion,” or “subject to approval,” you cannot force a transfer.

When Transfers Are More Likely to Be Approved (Real-World Practice)

Even though not legally required, developers commonly approve transfers when:

You have paid a substantial amount (especially ≥2 years).
You request before formal cancellation is processed.
You shift to a unit/project that is:
- More expensive (upgrade), or
- Easier to sell (developer benefit).
You have a clean payment record until a recent hardship.
You negotiate amicably and in writing.
Management wants to avoid Maceda cash refunds.

Typical Conditions Developers Impose

If allowed, developers may require:

Administrative / processing fee (fixed amount or %).
Forfeiture of reservation fee.
Updated price list (you pay the difference).
Resetting of payment schedule based on new CTS.
Loss of promos/discounts tied to old unit.

These conditions are legal so long as they don’t violate Maceda/PD957 refund minimums or become unconscionable.

How to Request a Transfer Properly

Write a formal request Addressed to the developer’s Accounts/Customer Care/Collections/Legal.
State your situation clearly
- Why you are cancelling.
- How much you’ve paid.
- That you want reapplication to another project.
Cite your baseline legal rights
- If ≥2 years paid, mention your Maceda refund entitlement. This signals that transfer is a mutually beneficial alternative.
Ask for a written computation
- Amount to be credited.
- Amount to be forfeited.
- Fees and new schedule.
Do not rely on verbal assurances Get a signed document:
- Credit memo, OR
- New CTS explicitly stating applied amounts, OR
- Settlement agreement.

If the Developer Refuses

Your options depend on your facts:

If buyer-side cancellation:

Enforce Maceda refund if qualified (≥2 years).
If <2 data-preserve-html-node="true" years, refund rights are weak; negotiation is your main tool.

If developer-side fault:

File a complaint with DHSUD for refund/rescission.
You can still offer transfer as settlement, but demand full credit.

In either case, don’t sign a “Quitclaim” or “Waiver” unless the terms match what you are actually receiving.

Taxes, Documentation, and Compliance Issues

Transfers are treated as a new sale for most legal and accounting purposes:

A new CTS is issued.
The developer may record the original contract as cancelled and the new one as separate.
Documentary stamp and VAT rules depend on stage and structuring, but buyers usually just see new pricing and schedules.

The key for you is to ensure the credit is clearly documented in the new contract or a separate agreement.

Practical Warnings for Buyers

Don’t delay your request. Once cancellation is finalized and accounts are closed, developers are less flexible.
Check License to Sell of the new project. Never “transfer” into a project without proper approvals.
Verify the net credit. Ask for a line-by-line ledger.
Watch for hidden forfeitures. Some developers quietly drop older payments as “penalties” beyond what Maceda permits.
Remember: refund is your legal floor. If transfer terms are worse than your refund right, insist on the refund.

Bottom Line

Philippine law (Maceda + PD957) does not grant an automatic right to transfer payments from a cancelled condo to another project of the same developer.
Your automatic rights are refunds/grace periods, not credits.
Transfers are possible and common in practice, but they are:
- Contract-based, or
- Policy/negotiation-based, and
- Often come with fees/forfeitures.
If the developer is at fault, you can negotiate from a stronger position, but your enforceable right remains refund/rescission, not transfer.

If you’re considering a transfer, treat it like a settlement: compare it to what the law guarantees you in cash, then accept only if it’s at least as good—or better—than your refund entitlement.