What Is a Deed of Conditional Sale?
A Deed of Conditional Sale is a contract of sale whose final effects are made to depend on a condition — in practice, almost always the full payment of the purchase price in installments. It is the name Filipino buyers, sellers, and brokers most often use for the document that governs an installment purchase of land, a house and lot, or a condominium unit before title is transferred.
The label, however, is doing less legal work than most people assume. What matters to a Philippine court is not the title at the top of the page but the stipulations inside it — above all, the clause that says when ownership passes.
Deed of Conditional Sale vs. Contract to Sell — the Honest Answer
The two instruments overlap heavily, and in everyday practice most documents titled "Deed of Conditional Sale" are, in substance, Contracts to Sell. The doctrinal difference sits in one clause:
- Contract to Sell — the seller expressly reserves ownership. Full payment is a positive suspensive condition; until it happens, no sale takes place at all, and a separate Deed of Absolute Sale is executed after the last payment.
- Conditional sale (strict sense) — the parties agree on a sale subject to a condition, and the contract can be worded so that ownership transfers automatically the moment the condition is fulfilled, without a second deed.
The Supreme Court has repeatedly held that it will examine the actual terms — reservation of title, who holds possession, who pays taxes, whether a further deed is contemplated — to classify the contract, whatever the parties called it. A "Deed of Conditional Sale" that reserves title until full payment is a Contract to Sell in effect.
Practical consequence: if your goal is the standard installment arrangement — buyer pays over time, seller keeps the title until fully paid, then executes a Deed of Absolute Sale — the clean, unambiguous instrument is a Contract to Sell with an express reservation-of-title clause. That is the document Legalia generates, and this page exists to tell you honestly that it covers the same use case people search for as "deed of conditional sale."
What the Contract Must Contain
Whichever name appears on top, a properly drafted installment-sale contract for Philippine real property states:
- The parties — vendor and vendee, with civil status and marital consent where required;
- The property — TCT/CCT number, issuing Registry of Deeds, location, and technical description;
- The price and payment schedule — total price, down payment, and the exact number, amount, and due dates of installments;
- The reservation-of-title clause — ownership stays with the vendor until full payment;
- Possession and restrictions — whether the buyer may occupy early, and a bar on selling, mortgaging, or altering the property while paying;
- Default, grace period, and forfeiture terms — expressly subject to the Maceda Law where it applies;
- The undertaking to execute a Deed of Absolute Sale upon full payment.
The Maceda Law Applies Either Way
For residential real estate bought on installments, Republic Act No. 6552 (the Realty Installment Buyer Protection Act, or Maceda Law) protects the buyer regardless of whether the document is called a Deed of Conditional Sale or a Contract to Sell: mandatory grace periods, a notarized notice of cancellation plus a 30-day lapse before the contract can be cancelled, and — after two years of installments — a cash surrender value refund of 50% rising to as much as 90% of payments made. Any clause less favorable to the buyer is void to that extent.
Generate Your Installment-Sale Contract with a Pro Plan
Legalia's Contract to Sell generator produces a notary-ready installment-sale contract with the reservation-of-title clause, Maceda Law-compliant default terms, and the acknowledgment block — the document behind every properly drafted "Deed of Conditional Sale."
Subscribe to Pro — Generate NowWhen a True Conditional Sale Makes Sense
There are situations where the condition is something other than payment — for example, a sale conditioned on the approval of a subdivision plan, the release of a bank loan, or the cancellation of an existing encumbrance. Those bespoke conditions deserve lawyer-drafted language, because the automatic-transfer effect of a fulfilled condition can have tax and registration consequences the parties did not anticipate. For the ordinary pay-in-installments purchase, the Contract to Sell structure is the established, litigation-tested route.