Sebastian v. BPI Family · G.R. 160107

Petitioner: Sebastian
Respondent: BPI Family
Citation: G.R. No. 160107
Court: Supreme Court
Decided: October 22, 2014

Whether Republic Act No. 6552 (Realty Installment Buyer Protection Act) applies to housing loans from employers to employees and whether mortgage…

Summary

The Supreme Court ruled that Republic Act No. 6552 (Realty Installment Buyer Protection Act) does not protect borrowers who obtained housing loans from their employers to purchase real estate. The law only protects buyers in installment sale transactions, not lender-borrower relationships. The Sebastian spouses, former BPI Family Bank employees, obtained a housing loan secured by real estate mortgage. After their employment termination, the bank demanded full payment and initiated foreclosure. The Court found the foreclosure proper since the loan agreement contained an acceleration clause making the entire balance due upon employment termination, and the petitioners had defaulted on payments. The decision clarifies the limited scope of RA 6552 and upholds contractual obligations in employer-employee loan arrangements.

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The Maceda Law (Republic Act 6552)

By the Intellegal Editorial Board · October 22, 2014

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