How To Request For Unencumbered Certificate of Registration for your Car

December 4, 2019 | 6:28 am 14 Comments
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  • This is an incredible story about how I got to removed the “Encumbered” status from my Car’s Certificate of Registration (CR).

    After four (4) long years, finally, I paid my car loan to its last single cent. Imagine the happiness that I’m feeling right now while I’m writing this article?

    No more monthly payments, no more checks to sign and to fund. Total FREEDOM!

    Anyway, what I’m going to discuss right here and how is how I managed to get the copy of my original documents such as the Car’s Encumbered Certificate of Registration (CR), Official Receipt (OR), Cancellation of Chattel Mortgage, a copy of my Promissory note and lastly, the Unencumbered Certificate of Registration (CR).

    Just a background story, for the purpose of this article, I’ll be narrating my own experience with regards to my car loan and how I processed it. So before you get bored, let’s start!

    My Very First Car Acquisition

    My car was acquired on October 2014 through a car loan from the Bank. It was from China Bank Savings. If you’re wondering why China Bank Savings, I still have no idea. It’s just that the Car Sales Representative endorsed my application for loan to them. Anyway, the usual process have transpired. I submitted all the documents until it was approved and released my car.

    When I got my car, I was just given a photocopy of the car’s original receipt and certificate of registration. Note that for every car loan approved by the Bank, the original documents related to the car are kept by the Bank.

    As a noob car owner, I was surprised by this but according to the people I talked to, its pretty normal and standard. The bank usually do that. The original documents serves as your collateral when you fail to pay the monthly amortizations.

    After Four Years…

    Fast forward to this year, when I finally finished my payment. Since I already have the knowledge that after payment, I must obtain the original copy of the original copy of original receipt and certificate of registration. I immediately called the head office of China Bank Savings to inquire. I didn’t know who to talk to so I just asked the Telephone Operator to connect me to the Car Loans Department. She transferred me to the right department and explain to the person on the other line my situation. She told me that I should give her Forty Eight (48) hours to start working on my documents and car loan. I patiently waited and call back the next day.

    Forty Eight hours have passed and I called to ask the status of my request. She confirmed that I no longer have any amount due to them and my car loan are already fully paid. Also, my documents are ready for release in their head office. She also mentioned that there will be a small fee to be paid. She asked me for my schedule when I will be able to pick up those documents. I told her my schedule and we both said goodby and hang up the phone.

    When I got to the China Bank Savings head office, I informed my contact person that I arrived already. She prepared all the documents for release and handed me a deposit slip for the payment of the notary public fee of the cancellation of the chattel mortgage.

    Chattel Mortgage, Promissory Note and Other Important Documents

    By the way, the chattel mortgage is a loan arrangement in which an item of movable personal property acts as security for a loan. The movable property, or chattel, guarantees the loan, and the lender holds an interest in it. This is the document issued to you when you have a car loan. While the cancellation of chattel mortgage cancels the previous document mentioned.

    I went down to the ground of their building where a branch of their bank is situated to pay the fee. Rights after that, I gave the receipt to my contact person and she gave me the original copies of the following document.

    • Chattel Mortgage
    • Cancellation of Chattel Mortgage
    • Official Receipt
    • Certificate of Registration (Encumbered) and
    • Promissory note

    She also gave me a small piece of paper that serves as a guide in how to request the status of my Certificate of Registration changed from “Encumbered” to “Unencumbered”.

    Encumbered mean that the car is declared as owned by a person or an entity (which is me) but subject to a legal claim by another person or entity (which is the bank).

    I have taken a photo of each documents I received but for the purpose of confidentiality, I have covered personal information.

    The Promissory Note with Chattel Mortgage

    Cancellation of Chattel Mortgage

    Official Receipt

    Certificate of Registration

    So to remove the bank’s claim agains my car, I need to do further processing and apply for a new copy of my car’s Certificate of Registration. To be able to start this process, we need to run down first all the required documents.

    • Letter of request for the cancellation of my Loan and Chattel Mortgage addressed to my Bank
    • Encumbered Certificate of Registration (original copy)

    Since the my bank voluntarily issued me the Letter of request for the cancellation of my Loan and Chattel Mortgage was taken care of by my bank, my requirements are already complete.

    The next step is I need to bring this documents to the Registry of Deeds where my loan was listed. The Registry of Deeds will issue a form of cancellation on the encumbrance of my certificate of registration.

    Also note that the Registry of Deeds branch that I need to visit is the branch indicated in my Promissory note or Chattel mortgage.

    You need to fill out an application registration form.

    The presence of your car is not mandatory in Registry of Deeds since you are just cancelling the documents (Chattel Mortgage/Promissory Note). A small fee will be collected, an amount of P900 to 1000 depending on the mortgaged amount of your car.

    Processing time depends on the Registry of Deeds Branch, few lucky ones got their documents after several hours but several people claimed that the processing takes one (1) to three (3) business days.

    After waiting for considerable time, the Registry of Branch will give you a copy of the “Release of Chattel Mortgage with a Cancelled” mark/stamp by the Registry of Deeds.

    It also include the Official receipt of the payment made for the cancellation as well as the Promissory Note.

    Last step is go to the LTO Office with your car including all the documents from the bank plus the official receipt issued by the Registry of Deeds, release of Chattel Mortgage dully annotated by the RD.

    Make sure to bring the following:

    • Original Certificate of Registration (Encumbered)
    • Latest OR of MVVC & other fee payment
    • Release of Chattel Mortgage issued by Registry of Deeds
    • Your TIN Number
    • and lastly, the accomplished Motor Vehicle Inspection Report (MVIR)

    Also, make sure to bring your car to LTO for inspection, engine & body number stenciling. The process will take you two (2) to four (4) depending on the volume of applicants. Just make sure to bring all the needed documents and never ever transact with the FIXERS within the LTO Branch.


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    • Sheila says:

      Hi, im on this same process. My question is whether I need to go to the LTO branch indicated in my CRE or I can go for this transaction to any branch?

    • Aida says:

      How much did you pay at LTO?

      • Miera says:

        I’m processing my certificate of non encumberance now. Upon submitting my documents to QC Registry of Deeds on the 16th Sep. it was released the 24th, maybe their data is not computerised yet. I drove straight to Valenzuela LTO because that’s where the car was originally registered. Now awaiting the release of my new OR and I’ve been here for 2 hours…

    • Manuel says:

      Did you give all the copy of your documents that comes from Registry of Deeds and Bank to LTO? I am with same process and LTO took all the copy of my documents that cones from registry of deeds and bank.

      • Pam says:

        Hi, in my case LTO took everything as well. All those docs from the RD and the bank. And I failed to have a photocopy. Dont know if it will still matter, now that we have the unemcumbered CR.

    • paulo says:

      new car owner here, medyo di ko magets pano ung magiging renewal nung registration ng sasakyan after the first 3 years kung nasa bank ung original?

    • robert francis torres says:

      How much did you pay at the LTO excluding MVIR?

    • Patrick says:

      How much did you pay at the RD? I read somewhere that the fee s 1% of the loaned/mortgaged amount. Is that true?

    • Albert says:

      How much did you pay in LTO.

    • Leo says:

      If pnp clearance needed in the lto for removing the encumbered?

    • Demy says:

      How was your experience at LTO? Did they ask for additional supporting documents other than what is required?

    • Norena Dula Paguio says:


      May I bring my car in any lto office?

    • redd says:

      I am a resident of Northern Mindanao. I was able to purchase a secondhand car that was originally registered in NCR. The unit was encumbered to BPI Family Savings Bank in the year 2015, and the mortgage was recorded in the Registry of Deeds (RD) Manila. I already have the Notarized Release of Chattel and Promissory Note, but the mortgage needs to be cancelled in the RD Manila. Will there be any way for me to apply for the cancellation online so I won’t have to visit the RD Manila as I would have to travel from Mindanao to Luzon? I am suggesting that we develop a way to make the processing easier. Thank you so much. Mabuhay po kayo.