List of LTO Driver’s License Classification

Driver’s are not the same everywhere. There are, in fact, different types of drivers as categorized by the different classifications of driver’s licenses (DL). In the Philippines, the Land Transportation Office (LTO) regulates the drivers and identifies who can drive what vehicle through the different LTO Driver’s License classifications. 

The different DL classifications exist so that the drivers of different types of vehicles can be categorized accordingly. You can get a certain class of driver’s license depending on your age, competence, the type of vehicles you can drive, how long you have been driving, as well as if you are driving for a living or not. Though the procedures for getting a driver’s license is generally the same for all types, there’s an innate difference in the driving tests and requirements, too. You can learn more about the different driver’s license classifications here.

drivers license classification in lto

What is an LTO Driver’s License (DL)

An LTO driver’s license is essentially a driving permit or a legal authorization expressly written in an official document confirming such an authorization, issued by the government (LTO, in particular) to an individual so they can legally operate one or more types of motorized vehicles—like motorcycles, cars, trucks, or buses—on a public road. These different license types are often made from plastic and take the size of a credit card.

The driver’s license issued by LTO also has different categories or classifications. Each type offers different levels of permission to drive. The type or class of driver’s license you can get highly depends on your age, competence, the type of vehicles you can drive, how long you have been driving, as well as if you are driving for a living or not. It also defines where you can legally drive a motor vehicle. Though the license application procedures are generally the same, there are different evaluation procedures, requirements, and fees for each class, and the difficulty of the driving test also varies considerably between DL classes.

LTO Driver’s License (DL) Classifications

There are several classifications for LTO driver’s licenses in the Philippines. As of writing, there are three types of driver’s licenses currently being issued in the country.

Student Permit

One of the most exciting parts of becoming an adult is taking care of things only adults are allowed to do, just like driving. In the Philippines, every driver is required to go through a “student” phase, the period when they need to secure a student permit and operate a motor vehicle in public, under the guidance of either a non-professional or professional licensed driver. It’s like the first step to take or the first level in getting a driver’s license, so to speak. For some, it is a rite of passage—one that many teenagers look forward to.

To secure a student permit, the interested applicant needs a notarized letter from either a parent or guardian (for minors), proof of identity (original and certified true copy (CTC) of your PSA-authenticated birth certificate with receipt or original and photocopy of your passport), and Taxpayer’s Identification Number (TIN). Of course, it’s a given that the applicant must be at least 18 years old, physically and mentally stable, and able to speak and understand English and Tagalog.

Non-Professional Driver’s License (NPDL)

Tired of being chaperoned in your own ride? Well, if you are of age and have survived a month on a student permit, then you can go on and secure your first government-issued ID card by applying for the Non-Professional Driver’s License. This license classification is designed for rookie drivers fresh out of the “student” phase as well as those who have no intention of driving a public vehicle or any motor vehicle for a living. It is the perfect license for those who intend to drive private vehicles that weigh no more than 4500 kilograms, including hatchbacks, pick-up trucks, or sports utility vehicles (SUVs).

To secure an NPDL, applicants must pass the written examination composed of 40 randomized questions by acquiring at least 30 correct answers. Other requirements include a valid student permit that is at least a month old, a medical certificate electronically transmitted from any LTO-accredited medical clinic, doctor, or if you are a military personnel, a valid AFP/PNP organic personnel ID and a negative drug test result from a DOH-certified drug testing facility, a clearance certificate from either NBI, court, or commanding officer (which applies only to medical personnel).

Professional Driver’s License (PDL)

However, if you are securing a driver’s license in the name of pursuing a career as a public utility vehicle (PUV) driver or a commercial driver in the Philippines, what you will need is neither a student driver’s permit nor a Non-Professional Driver’s License but a Professional Driver’s License (PDL). This is a requirement for drivers who intend to operate vehicles that weigh more than 4600 kilograms like bulldozers and other heavy construction vehicles.

To apply for this class of driver’s license, applicants must be at least 18 years old, has secured a medical certificate electronically transmitted from any LTO-accredited medical clinic or doctor or, if you are a military personnel, a valid AFP/PNP organic personnel ID, a negative drug test result from a DOH-certified drug testing facility, and a clearance certificate from either NBI, court or commanding officer (applicable only for medical personnel). Unlike the written examination for Non-Professional Driver’s License, a Professional Driver’s License requires you to secure a score of at least 45 out of 60 random questions which can either be in English or in Tagalog.

Other Driver License Not Issued by the LTO

Aside from the LTO-issued driver’s license, there is another type of driving license that citizens can acquire to be able to drive legally on public roads.

International Driver’s License/Permit (IDP)

An international driver’s license, otherwise known as the international driver’s permit (IDP), is a license issued to permanent residents of the Philippines who would like to be able to use their license to drive a motor vehicle freely on the roads of over 150 other countries in the world, except for Australia and Spain which allow Filipinos to operate vehicles with either their professional or non-professional license. 

Unlike the LTO driver’s license, the IDP is only issued at the Automobile Association Philippines (AAP), the country’s biggest and oldest auto club committed to the general welfare of motorists in the Philippines. To secure an IDP, motorists applicants need to submit two (2) photocopies of their current driver’s license and two (2) 2×2 pictures with white background.

Important Reminders

If you wish to secure any of these driver’s license, you’d want to take note of these tips and reminders:

  • If it’s your first time to secure a driver’s license, you will need to start with a student permit before you can apply for the other classes. 
  • In Spain and Australia, regular LTO-issued driver’s license, whether Non-Professional or Professional driver’s license, can be used.
  • Non-professional driver’s license (NPDL) issued for the first time is only valid for five (5) years.
  • Holders of license with five-year validity must take the PME within 60 days before their 3rd birthdate from the issuance of their license.
  • Those with a ten-year license, must undergo their PME before their 4th and 7th birthdays from the issuance of their license.
  • For those who are securing an LTO driver’s license, you may do so via the Land Transport Management System (LTMS) online portal.
  • Regardless if you are initiating the driver’s license in person or online, you will need a medical certificate electronically transmitted to the LTO by an LTO-accredited medical clinic. 

Video: How to Get a Non-Professional LTO Driver’s License in the Philippines

For a clearer guide on how to secure an LTO Non-Professional driver’s license (NPDL), you may check out this video guide posted by It’s Ally.

Frequently Asked Questions (FAQs)

Here are some common questions and answers regarding the LTO Driver’s License in the Philippines:

1. Does the LTO accept online driver’s license applications?

Yes. Applications for an LTO driver’s license may be done online if you register an account on the LTMS portal. You might still need to visit an LTO office though, especially for NPDL and PDL as you will need to take the LTO exams before a driver’s license can be issued to you. You may also apply for any LTO driver’s license through any of the LTO branches nationwide, though you’d want to check first if you need an appointment or if they entertain walk-in applicants. 

2. How long is the validity period of an LTO driver’s license?

Depending on the license classification, the following validity period may apply: 

  • For Student Permits: The validity period is one year. 
  • For first-time professional and non-professional driver’s licenses as well as those who are renewing with traffic violations: The validity period is five years. 
  • For those with NPDL or PDL with a clean record: The license may be renewed with a 10-year validity period as per Republic Act 10930.

3. Where can I find the expiry date of my driver’s license?

If you are looking for the expiry date of your driver’s license, then you can find it on the card’s front side. The validity period of your DL will also depend on whether your license is issued before or after your birthday. If your license was issued before your birthday, the current year is included in the validity period. Otherwise, the current year is not included when counting the validity period. 

4. Where can I find the information on my license classification? 

If you need to check your LTO driver’s license for the license class and DL code, then you can turn your license card face-down and look. The license classification information is in the back, unlike the old one which is on the front side.

Summary

When it comes to driving, it is imperative to consider the age, competence, the type of vehicles you can drive, how long the driver has been driving, as well as if they are doing it for the money or not. It is because these factors decide how well they can drive safely and if they deserve to be allowed on the road with a motor vehicle. After all, the main goal of issuing a driver’s license and having restriction codes added is to regulate the drivers by allowing only the responsible and roadworthy ones to ensure not just their safety, but also the safety of the people around.  It is important to understand the difference between the different driver’s license classifications not only because there are varying processes of its application but also because the classification can tell a lot about how well the driver can keep the motor vehicles and the roads safe.

What is Driver’s Reorientation Course (DRC)

The Driver’s Reorientation Course (DRC) is just one part of the Driving Enhancement Program (DEP) offered by the Land Transportation Office (LTO) or a duly accredited service provider to Filipino drivers. The course is especially designed as a corrective measure of sorts for license holders, professional or otherwise, who have had at least five (5) demerit points, and who intend to renew their licenses.

The course is also mandated by law as condition precedent to Driver’s License renewal of those with ten (10) accumulated demerit points or whenever the same violation is committed for at least three (3) times during the validity of the driver’s license.

Unlike the Comprehensive Driver’s Education (CDE) Course of the DEP, the Driver’s Reorientation Course (DRC) is not a course for everyone. It is especially reserved for those with driving or traffic violations. It is also similar to the Comprehensive Driver’s Education (CDE) in the sense that the licensees need to apply for and complete the Driver’s Reorientation Course (DRC) before they are allowed to renew their driver’s licenses. It also culminates with a written exam that attendees need to take and pass as well.

driver's reorientation course DRC

What is DRC

DRC stands for Driver’s Reorientation Course—a course designed in compliance with Section 14 of the Implementing Rules and Regulations (IRR) of the Republic Act No. 10930. It is a mandatory requirement for the renewal of a driver’s license with at least five (5) demerit points. It also serves as a condition precedent to driver’s license renewal for those who had accumulated at least ten (10) demerit points or who had committed the same violation for at least three (3) times during the validity of the driver’s license.

The DRC, unlike the CDE, requires a set number of training hours that must be completed before they can fully claim to have completed the DRC and secure a certificate of completion. As an intervention program, it is usually paired with the Theoretical Driving Course (TDC) and also culminates in a written examination. Meanwhile, public utility vehicle (PUV) drivers who have committed franchise-related violation shall be required to undergo another intervention program in the form of a training-seminar conducted by the PUV Drivers’ Academy of the Land Transportation Franchising and Regulatory Board (LTFRB) along with the DRC. Failure to complete the courses would entail license suspension until the required attendance to the courses is complied with.

Purpose

The Driver’s Reorientation Course is a refresher course meant to remind licensed drivers with a long list of violations about the basics of driving and road safety. It is given as a penalty and disciplinary education and was designed for drivers who accumulated five (5) or more demerit points within the validity period of their licenses. Through this, the agency hopes that the driver’s would be reminded of the responsibility attached to the privilege to drive by having them learn to be more careful on the road. 

Benefits

Some of the benefits associated with taking the Driver’s Reorientation Course (DRC) includes:

  • Being able to secure the Certificate of Completion which is a requirement for driver’s license renewal
  • Getting a refresher course on the old rules of the road you may have already forgotten 
  • Getting a crash course on new LTO rules
  • Being able to serve at least one of the penalties for accumulated demerits without spending money
  • Being able to avoid possible suspension of driver’s license 30 days after committing a driving or traffic violation 
  • You can get a driver’s license which doubles as a valid photo ID that can be used when transacting in both public and private offices
  • The license renewal process requires this if you have demerit points

Eligibility

To take the Driver’s Reorientation Course (DRC), you must meet the following conditions:

  • Must be a holder of active Driver’s License 
  • Must be a holder of a Driver’s License that has expired but not for more two (2) years  
  • Must be holders of Driver’s License with accumulated five (5) to nine (9) demerit points
  • Must be holders of Driver’s License with ten (10) or more but less than forty (40) demerit points
  • Must be a holder of an LTO Driver’s License that has been expired for more than two (2) years and/or with ten (10) or more but less than forty (40) Demerit Points
  • Must be looking to renew their driver’s license
  • Must be physically fit to operate a motor vehicle
  • Must have sound mental faculties fit for operating a motor vehicle
  • Must be a Traffic violator
  • Must not have any unsettled traffic violation

Requirements

Before you can take the Driver’s Reorientation Course (DRC), you need to first prepare the following documentary requirements: 

  • Official Receipt (OR) as proof for the payment of fine/s
  • Temporary Operator’s Permit (TOP) (Pink copy) or e-TOP;
    • In case of loss of TOP/e-TOP: an Affidavit of Loss
  • Document printout or screenshot from the system showing the violation and the corresponding number of demerit points from the Data Control Unit (DCU) at the LTO Central Office
  • Apprehension details from the Releasing Unit of the LTO Central Office

Procedures

To get into the Driver’s Reorientation Course (DRC), here are the steps that you need to follow:

Step 1: Visit your preferred LTO Office. You can choose from any of the following: 

  • Drivers Education Centers (DECs) at the LTO Regional Offices
  • Traffic Safety Division (TSD) at the LTO Central Office 

Step 2: Proceed to the TSD/DEC Service Counter and present and/or submit the requirements to the TSD/DEC Officer of the day so they can evaluate and check for authenticity and completeness evaluation.

Step 3: Once the records of your driver’s license violation is retrieved and verified, the TSD/DEC Officer of the day will inform the licensee to register to the Client’s Attendance Sheet and fill out the Driver’s Reorientation Course (DRC) Form.

Step 4: Register on the Client’s Attendance Sheet and fill out the Driver’s Reorientation Course (DRC) Form.

Step 5: Once registered, attend the Driver’s Reorientation Course facilitated by the TSD/DEC proctor. 

Step 6: After completing the course, take the examination facilitated by the TSD/DEC proctor. 

  • If passed: The proctor shall take your picture and prepare DRC Certificate of Completion.
  • If failed: The proctor will tell you to retake the exam on the following regular working day or any day convenient for you.

Step 7: Once the Certificate of Completion is signed and uploaded to the Law Enforcement and Traffic Adjudication Service (LETAS)-Seminar Penalties to settle the seminar requirement, your Certificate of Completion will be released by the TSD/DEC Officer of the day.

Fees

There are no fees associated with the Driver’s Reorientation Course (DRC). It’s free, except, perhaps,  for the expenses related to paying for the requirements and travel and personal needs. 

Where to Avail

To take the Driver’s Reorientation Course (DRC), you will first need to visit either of the following LTO offices:

Important Reminders

For your reference, here are some important reminders:

  • The Driver’s Reorientation Course (DRC) is an intervention program tha serves both as a refresher course and a penalty for driver’s license holders with violations.
  • It is a mandatory requirement for driver’s license renewal.
  • The Driver’s Reorientation Course (DRC) is free of charge.
  • Failure of the driver to complete the said intervention program within thirty (30) days from the date of the last apprehension shall cause the suspension of the driver’s license upon prior notice until the required attendance to the course is complied with. (Section 15, par. 2 of IRR of R.A. No. 10930.
  • Just like the Comprehensive Driver’s Education (CDE), the Driver’s Reorientation Course (DRC) also culminates with a written exam. 
  • The Comprehensive Driver’s Education (CDE) course and the Driver’s Reorientation Course (DRC) together makes up the LTO Driver’s Education Program (DEP).

Video: Driver’s Education Program—Driver’s Reorientation Course

Learn more about the Driver’s Reorientation Course—the other half of the Driver Education Program (DEP) imposed by the LTO to both Filipino and foreign driver’s license holders in the country. Watch this video!

Frequently Asked Questions (FAQs)

For more information on the Driver’s Reorientation Course (DRC), here are the most common questions and answers related to it:

1. Do I need to take the Driver’s Reorientation Course (DRC) every time I renew my license?

Not necessarily. The Driver’s Reorientation Course (DRC) is only required for license holders who have accumulated at least five (5) demerit points due to driving and traffic violations withing the duration of the license validity. 

2. How much does it cost to enroll in the Driver’s Reorientation Course (DRC)?

The course itself doesn’t cost anything. It is given by the LTO for free. You might need to spend for the requirements or for personal expenses, though. 

3. Can I take the Driver’s Reorientation Course (DRC) anywhere? 

No. It isonly offered for free at the LTO Drivers Education Centers (DECs) at any of the LTO Regional Offices nationwide and at the Traffic Safety Division (TSD) at the LTO Central Office in East Avenue, Diliman, Quezon City. 

4. When should I take the LTO Driver’s Reorientation Course (DRC)? 

The Driver’s Reorientation Course (DRC) must be taken within thirty (30) days from the date of the last apprehension. 

5. What happens if I fail to take the Driver’s Reorientation Course (DRC) on time?

Failure to take the Driver’s Reorientation Course (DRC) on time, which is within 30 days of the last apprehension, means the possibility of getting your license suspended until the course required is completed.

6. How would I know that I need to take the Driver’s Reorientation Course (DRC)?

The driver or license holder will receive a notification from the LTO stating the he is required to undergo a mandatory Driver’s Reorientation Course to be conducted by the Land Transportation Office or a duly accredited service provider for every ten (10) accumulated demerit points or whenever the same violation is committed for at least three (3) times during the validity of the driver’s license.

7. Is the Driver’s Reorientation Course (DRC) the same as the Comprehensive Driver’s Education (CDE) course? 

No. These are two different course required by the LTO from drivers who wish to renew their licenses. The two makes up the LTO Driver Education Program though.

Summary

All driver’s license holder who wish to apply for the renewal of license to operate any motor vehicle legally buy has accrued at least five (5) demerit points during the license validity period are required to complete a Driver’s Reorientation Course to be conducted by the LTO DEC or any LTO-accredited service provider. It is a condition precedent to Driver’s License Renewal, especially for traffic violators in the country. Despite the hassle, it is a good chance to refresh your knowledge of the rules on the road, while the LTO hopes that such knowledge will keep you and the others safe while you drive. It’s a free course too, so there really is no reason not to comply.

Annotation and Cancellation of Mortgage for Motor Vehicles 

The Land Transportation Office (LTO) also offers services like annotation and cancellation of mortgage for motor vehicles (MV). This service is particularly important as doing so will officially transfer the ownership of an encumbered motor vehicle to your name, making you the official MV owner. 

This service is particularly important in the advent of secured and credit auto loans. Nowadays, many vehicles are acquired through loans, which means a lot of them are encumbered, requiring the owner to process the annotation and cancellation of [chattel] mortgage and get their name placed as the owner of the vehicle.

annotation and cancellation of mortgage of car motor vehicle

What is ‘Certificate of Registration Encumbered’ (CRE)

Vehicles bought through the bank or via a lending company do not get a regular Certificate of Registration (CR). Instead, the owner gets a Certificate of Registration Encumbered (CRE)—an MV registration document that puts the lender as the owner of the vehicle instead of the buyer until such time that the buyer has completely repaid the loan.

The CRE is issued to prove that the motor vehicles or other items of movable personal property, or chattel, is subject to Chattel Mortgage or is used to secure the loan. It also means that the lender who released the funds needed to purchase the vehicle holds an ownership interest in it. Once the buyer has fully repaid the loan, then it is the only time that their name will be placed as the owner of the vehicle. Until then, the MV is registered in the Chattel Mortgage Register as security for the performance of an obligation. 

How to Check if a Car is Encumbered

To check if the vehicle is encumbered, you simply need to check the Certificate of Registration (CR). You can tell that the CR is actually a CRE if there is an annotation on it that says “encumbered.”

Where to File for the Annotation and Cancellation of Mortgage 

Cancellation of the Mortgage is done at the Registry of Deeds, but filing for annotation and cancellation of Chattel Mortgage can be done at the LTO. However, it can’t just be any LTO office. Changing the registration status of your motor vehicle has to be done at the originating LTO branch office, or the LTO office stated on the Certificate of Registration (CR). This means that if the CR says LTO Manila, it has to be done at LTO Manila. Going to any other LTO branch will simply make you waste your time, effort, and money.

Requirements for Filing for Annotation and Cancellation of Mortgage

Before going to the LTO, you will need to secure and prepare the following documentary requirements to avoid the hassle of having to come back to continue the process. 

The requirements are as follows:

  • Original and a photocopy of the Loan Contract
  • Chattel Mortgage Form
  • Two (2) of the following valid government-issued photo ID from the registered car owner
    • Driver’s License
    • Philippine Passport
    • Professional Regulation Commission (PRC) ID
    • SSS ID
    • GSIS ID
    • BIR ID
    • TIN ID
    • Voter’s ID
  • Taxpayer’s Identification Number (TIN)

Once these documents are ready, you may now go to the bank or the lending company who financed your loan to obtain these additional documentary requirements:

  • Original Certificate of Registration (CR) of the vehicle 
  • Latest original and photocopy of the Official Receipt (OR) of payment for the vehicle
  • Chattel Mortgage Contract duly-annotated or stamped by the Registry of Deeds (RD)
  • Original Registered Promissory Note with Chattel Mortgage
  • Two (2) copies of the Release of Chattel Mortgage 
  • Official Receipt (OR) of payment of the annotation with Registry of Deeds
  • Motor Vehicle Inspection Report (MVIR) (Motor Vehicle Inspection Report)
  • Confirmation of CR/OR (CIR-91-137) if issued by other LTO Agency

Note: You will need to have some funds at hand as you will be charged for the notarial fee to get the documents notarized before it can be released. The notarial fee ranges from P300.00 to P400.00.

How to File for Annotation and Cancellation of Mortgage for Motor Vehicles

To file for annotation and cancellation of Chattel Mortgage for your vehicle upon paying off your auto loan, then here are the steps to follow: 

Step 1. Make sure that your registration is up-to-date and that there are no pending penalties on the documents. 

Check whether the registration is up-to-date and if the vehicle is free from violations and penalties. Do not forget to also check for any discrepancies on the documents. Get the bank or the lending company to correct the documents (if needed) and confirm its availability for pick-up. Some buyers, especially for pre-owned vehicles, forget to check these things, resulting in more problems and hefty fees later on.

Step 2. Secure and prepare the documentary requirements.

Prepare the required documents and make sure you get them duplicated properly. Some documents need to be photocopied so make sure you have enough duplicates for record keeping and for submission. You will also need to get the other documents notarized, so make sure you have enough funds to do so. 

Step 3. Check the office of the Registry of Deeds (RD) where you should cancel the mortgage.

Once you have the documents prepared, proceed to the Registry of Deeds (RD) where the mortgage was registered. You should see this in the stamp on the original Registered Promissory Note with Chattel Mortgage. If it isn’t, it should also be in the original CR under the space for RD.

Step 4. Accomplish the necessary forms and submit the requirements at the designated RD.

At the RD office, you will be asked to fill out a form then submit it together with the following documents:

  • Original Registered Promissory Note with Chattel Mortgage
  • Release of Chattel Mortgage 
  • One (1) copy of your two (2) valid IDs (Driver’s License, Philippine Passport, PRC ID, SSS ID, GSIS ID, BIR ID, TIN ID, Voter’s ID).

Step 5. Before it can be processed, you will be asked to pay for some fees at the cashier—the amount of which will vary depending on the amount of your mortgage.

Processing Time for Cancellation of Mortgage

The processing time for the cancellation of the chattel mortgage may vary depending on the branch and whether the person who will sign is present at the time. That said, the processing time for the cancellation of the chattel mortgage at the Registry of Deeds could range anytime from a few hours to about two to three days.

Step 6. Once you receive the official document for the Cancellation of Chattel Mortgage, you may proceed to the designated Land Transportation Office (LTO) branch to have it removed from your vehicle’s Certificate of Registration (CR). 

Step 7. At the designated LTO branch, tell the personnel that you would like to process the cancellation of encumbrance for your vehicle.

Step 8. Proceed to the transaction counters and submit all the following documents to the Evaluator for evaluation and computation of fees. 

  • Release of Chattel Mortgage (duly stamped by the Register of Deeds) 
  • Official Receipt from when you paid for the cancellation.

Step 9. Once completed, proceed to the actual inspection of motor vehicles with duly accomplished MVIR (Motor Vehicle Inspection Report).

Step 10. Proceed to the Cashier when your name is called for the necessary fees and obtain an Official Receipt (OR).

Step 11. Surrender the Original LTO Certificate of Registration with “Encumbered” on it.

Step 12. Wait for the LTO personnel to print out a new LTO Certificate of Registration (CR) without the “Encumbered” annotation on it.

Step 13. Proceed to the Releasing Counter when your name is called to obtain the Certificate of Registration (CR), plates, stickers, and other requested documents.

Note: You will also need to pay for the new Certificate of Registration (CR) without the “Encumbered” annotation. The price ranges from P280.00 to P350.00.

Important Reminders

For your reference, here are some reminders worth taking note of. 

  • The annotation and cancellation of mortgage officially transfers the ownership of a motor vehicle acquired through a loan from the lender to the buyer. 
  • The process involves two (2) steps: cancellation of mortgage and official removal of the encumbered annotation from the LTO Certificate of Registration. 
  • The process requires the cancellation of mortgage first as it is a requirement before the encumbered annotation can be removed from the CR and a new CR can be issued.
  • There’s a separate fee for the cancellation of mortgage and for the removal of the encumbered annotation on the LTO CRE and conversion to LTO CR.
  • New MV plates, stickers, and other documents will be issued along with the LTO CR without the encumbered annotation.

Video: Annotation and Cancellation of Chattel Mortgage

Learn more about how to process the annotation and cancellation of chattel mortgage for motor vehicles by watching this video from MamiZang Vlog:

Frequently Asked Questions (FAQs)

To help you complete the annotation and cancellation of chattel mortgage for motor vehicles, here are some common questions and answers about it. 

1. What is the annotation of Chattel Mortgage?

The annotation of chattel mortgage refers to the conditional sale of personal property, in this case, a motor vehicle, as security for the payment of a loan to purchase the motor vehicle, given by a bank or a secured loan provider, under the condition that the sale shall be void upon the seller paying to the purchaser a sum of money. 

2. What does it mean to have an “encumbered” vehicle?

An “encumbered” vehicle refers to a motor vehicle purchased via a bank or a secured auto loan. This means that the ownership of the vehicle is under the lender until such time that the buyer repays the amount paid for the vehicle in full. 

3. Does LTO process cancellation of mortgage? 

No. The actual cancellation of chattel mortgage is done at the Registry of Deeds. The LTO only handles the removal of the “encumbered” annotation from the LTO Certificate of Registration.

4. How much does it cost to cancel the Chattel Mortgage?

There is no specific amount to pay for the cancellation of Chattel Mortgage as it will depend on the amount of the mortgage. Other expenses include payments for notarial services. 

5. Is the removal of the encumbered annotation in the Certificate of Registration at the LTO free?

No. There is a fee and it ranges from P280.00 to P350.00 to remove the encumbered annotation in the Certificate of Registration at the designated LTO branch. 

Summary

Annotation and cancellation of Chattel Mortgage is an important step to take especially for those who acquired their vehicle through a bank or a secured loan. This process ensures that the vehicle ownership is transferred to the buyer after paying for the loan in full. It also ensures that the motor vehicle is removed from the Chattel Mortgage Register and that it would no longer serve as the collateral for the loan taken out by the buyer. Not only that, it is also a required procedure in order to replace your LTO CRE with an LTO CR.

The process for annotation and cancellation of Chattel Mortgage involves both the procedure for cancellation of mortgage and the official removal of the encumbered annotation from the LTO Certificate of Registration. It starts with the cancellation of the mortgage first so the car owner will have the requirements for the removal of the encumbered annotation from the CR and a new CR can be issued.

Contact Information

For more information or to address your concerns or inquiries regarding the Annotation and Cancellation of Chattel Mortgage, you may reach out to LTO via the following contact information:

Land Transportation Office (LTO)

LTMS portal: Visit the LTO’s official website and fill out their Contact Us form at https://portal.lto.gov.ph/ords/f?p=PUBLIC_PORTAL:CONTACT_US:115716301949471.
Phone call: You may contact them at their telephone number (632) 922-9061 to 66.
Email: You may also send them an email at clientcare@lto.gov.ph.
LTO Text Hotline Service: You may use LTO’s nationwide SMS service for drivers and vehicle owners by typing LTOHELP and sending it to 2600
LTO office: For information, you may check the LTO branch offices closest to you.

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