Motor Vehicle Inheritance: How to Transfer Car Ownership When the Registered Owner has Died?

Vehicle inheritance refers to the process of transferring the ownership of a motor vehicle from a deceased person to their legal heirs. This transfer is necessary to legally register the car and for the government to recognize the new owner and to comply with local laws and regulations. Understanding how to manage this process is crucial for avoiding legal issues and ensuring that the vehicle remains in good standing.

Knowing how to transfer car ownership when the original owner dies is important because it prevents complications related to the vehicle’s legal status. Without proper transfer, the car may not be legally driven or sold, and heirs might face fines or legal disputes. Ensuring a smooth transfer protects the heirs’ rights and allows them to use or dispose of the vehicle as needed.

Transferring Car Ownership From a Dead Registered Owner

Transferring car ownership from a deceased person means legally changing the vehicle’s registration from the name of the deceased to an heir or another designated person. In the Philippines, transferring a motor vehicle’s ownership after the owner’s death falls under estate law and the regulations of the Land Transportation Office (LTO). This process involves settling the deceased’s estate, obtaining necessary documents, and complying with local regulations, ensuring that the new owner has legal rights to the vehicle.

This transfer is done to establish legal ownership, prevent legal disputes, and allow the new owner to use or sell the car without issues. If this process is not completed, the vehicle remains in the deceased’s name, making it illegal to drive and potentially subject to fines or legal complications. These procedures are also necessary to avoid problems and ensure a smooth transition of ownership.

Legal Overview

As mentioned earlier, vehicle inheritance also involves transferring ownership of a deceased person’s car according to estate laws and LTO regulations. The “estate” encompasses all the deceased’s possessions, including vehicles, properties, and other assets and these legal considerations ensure that the rightful heirs gain ownership and prevent potential legal disputes or fines.

Will or No Will?

If the deceased had a will (testate), the process is straightforward, with the property distributed according to the will’s provisions. However, if there is no will (intestate), the estate must be settled among the surviving heirs. This settlement can be extrajudicial (outside of court) or judicial (through the court). For cars, an extrajudicial settlement is common, requiring heirs to agree on the vehicle’s distribution.

Estate Settlement

In an extrajudicial settlement, heirs must sign a Deed of Extrajudicial Settlement of Estate, which is then published in a newspaper of general circulation for three consecutive weeks. This publication notifies potential creditors and claimants about the settlement. If there is only one heir, an Affidavit of Sole Adjudication is used instead.

Transferring Car Ownership from a Deceased Owner

Transferring car ownership from a deceased owner requires following specific procedures to ensure the rightful heir gains legal possession of the vehicle, including gathering necessary documents, settling the deceased’s estate, and complying with LTO regulations. Understanding these steps is essential for a smooth and lawful transfer of ownership.

Required Documents

To transfer ownership at the LTO, the following documents are necessary:

Additional Requirements

For Motor Vehicles acquired through Extra-Judicial Settlement of Estate of Deceased Person

  • Original Certificate of Registration (CR)
  • Original Deed of Extra Judicial Settlement of Estate in case the deceased is survived by two (2) or more heirs or Affidavit of Sole Adjudication in case the deceased is survived by only one (1) heir
  • Affidavit of publication of the Deed in any newspaper of general circulation for three (3) consecutive weeks with clippings
  • One (1) photocopy of Death Certificate, Birth Certificate and/or Marriage Certificate

For Motor Vehicles acquired through Judicial Settlement of Estate of Deceased Person

  • Original Certificate of Registration (CR) or affidavit of loss
  • One (1) Certified true copy of Court Decision
  • One (1) photocopy of Death Certificate, Birth Certificate and/or Marriage Certificate

LTO Procedure

After gathering and preparing all documents, the heirs must present them to the LTO to process the transfer of ownership. This step is similar to the transfer of ownership via sale, including paying necessary fees. The LTO will update its records to reflect the new owner, completing the transfer.

For the actual procedures, please see below:

Step 1. Prepare Necessary Documents:

  • Gather all the required documents and make sure to get them ready before visiting the LTO office. 

Step 2. Pay Estate Tax

  • Ensure that the estate tax has been settled with the Bureau of Internal Revenue (BIR).

Step 3. Submit Documents to LTO

  • Present all prepared documents at the LTO office for processing.
  • Fill out and submit an Application for Transfer of Ownership form.

Step 4. Pay Fees

  • Settle the required fees for the transfer of ownership at the LTO.

Step 5. LTO Review and Processing

  • The LTO will review the submitted documents for completeness and accuracy.
  • Once verified, the LTO will update their records to reflect the new owner.

Step 6. Receive New Registration

Fees

To complete the LTO procedures, you will need to pay the following fees

Legal Research Fund (LRF) – P10.00

Transaction Fee (Transfer of Ownership) – P50.00

Late Application (Deed of sale exceeds One (1) month) – P150.00

Where to Process LTO Transfer of Ownership

To complete the procedures, you will need to visit any LTO District Offices (DO) or Extension Offices (EO) nationwide. However, if you need to complete other transactions along with the transfer procedures, take note that you will need to observe the following guidelines:

  • Change classification of Private to Diplomatic and Diplomatic to Diplomatic (eg. Consular Corps to Private/Diplomatic and vice versa) can be transacted only at Diliman District Office
  • Cancellation of mortgage can be transacted at any LTO District Office

Professional Assistance

Due to the complexity and potential legal challenges, hiring a lawyer experienced in estate law can be beneficial when transferring vehicle ownership from a deceased person, especially if there are multiple heirs fighting for the inheritance. Legal professionals can ensure all documents are correctly prepared and submitted, and that all legal formalities are followed, making the process smoother and reducing the risk of errors in completing the procedures. 

Video: How to Transfer Car Ownership at the LTO

This video from Da Kitchen PH will guide you through the process of transferring car ownership at the LTO in the Philippines. It covers the necessary documents, steps to follow, fees to pay, and all the necessary tips to ensure a smooth transfer. Watch until the end to learn how to navigate the legal requirements and complete the transfer successfully.

Summary

Transferring car ownership after the registered owner’s death involves legal procedures, document preparation, and compliance with Philippine laws. Understanding these steps and requirements can help ensure a smooth transfer. For additional guidance and to navigate potential legal complexities, consulting with a lawyer is advisable. Following these guidelines will help the rightful heirs gain legal ownership of the vehicle.