CREDIT TRANSACTIONS MC QUESTIONS

Which of the following statements regarding contract of pledge is not correct?

a. A pledge cannot be constituted unless the thing pledged be placed in the possession of the creditor.

b. Pledge is a real contract because it is perfected by delivery of the thing pledged

c. Pledge is an accessory contract because it needs a principal obligation to exist.

d. . A pledge cannot be constituted to secure the performance of a voidable or unenforceable or even a natural obligation

d. . A pledge cannot be constituted to secure the performance of a voidable or unenforceable or even a natural obligation

The following are requisites of Pledge except:

a. The disposal of the property by the pledge.

b. Absolute ownership of the property pledged.

c. The thing pledged may be placed in the possession of a third person.

d. To bind a third person, it must be recorded in the office of the Register of Deeds.

d. To bind a third person, it must be recorded in the office of the Register of Deeds.

Pledge and mortgage are accessory contracts. Which of the following statements is false?

a. They are meant to secure the fulfillment of a principal obligation.

b. They cannot exist if the principal obligation is void.

c. They can exist by themselves.

d. They can secure fulfillment of rescissible obligation

c. They can exist by themselves.

A stipulation whereby the pledgee or mortgagee automatically becomes the owner of the thing pledge or mortgaged:

a. Pactum commisorium.

b. Conventional redemption.

c. Consolidation of ownership.

d. Consignation.

a. Pactum commisorium.

A owes B the sum of P800. A pledge his solid Seiko gold watch as security. Later, A borrowed an additional sum of P200. from B. A paid B the P800 and demands the return of the solid Seiko gold watch which was the property pledged. B refused. (Art. 2098 New Civil Code)

a. B should return the solid Seiko gold watch as the original loan was already paid.

b. B should retain the watch until the P200 is paid.

c. B should deposit the solid Seiko gold watch with the court.

d. B should sell the watch at public auction to the highest bidder to insure the collection of P200.

a. B should return the solid Seiko gold watch as the original loan was already paid.

Ben pledged his watch to V.Y. Domingo Agencia for P5,000. On due date, Ben failed to redeem his watch. The pawnshop sold the watch at a public auction to the highest bidder at P4,000. (Art. 2115)

a. The pawnshop can recover the deficiency of P1,000 from Ben.

b. The pawnshop cannot recover the deficiency of P1,000 unless there is a stipulation.

c. The pawnshop cannot recover the deficiency of P1,000 even if there is a stipulation.

d. The pawnshop can recover the deficiency of P1,000 even without stipulation

c. The pawnshop cannot recover the deficiency of P1,000 even if there is a stipulation.

Three of the following are essential requisites of a contract of mortgage. Which is not?

a. The person instituting the mortgage has the free disposal of his property.

b. The contract must be in writing.

c. The mortgagor is the absolute owner of the thing mortgaged.

d. The mortgage is constituted to secure the fulfillment of a principal obligation

b. The contract must be in writing.

Cuenca mortgaged his lot and house to Bascon as collateral for the payment of his loan obligation. The mortgage contract stipulates that Cuenca cannot sell the property while the obligation exists. Before the maturity of the mortgage, Diaz offered to buy the property from Cuenca.

a. Cuenca cannot sell the property to Diaz unless he pays the loan obligation.

b. Cuenca can sell the property only if Bascon consent to it.

c. Cuenca cannot sell the property to Diaz because of the agreement not to sell while the mortgage exists.

d. Cuenca can sell the property to Diaz despite the stipulation in the mortgage contract not to sell.

d. Cuenca can sell the property to Diaz despite the stipulation in the mortgage contract not to sell.

O gets a loan of P100,000 from P which becomes due on November 23, 2021 and mortgaged his house as security for the debt. On September 22, 2021 the mortgaged house was completely destroyed by fire. A week after, P demanded payment from O on September 29, 2021. Is P’s demand valid?

a. No, because the obligation is one with a definite period and the demand would be prejudicial to the rights of the debtor.

b. No, the obligation is extinguished because the object of the obligation is lost through a fortuitous event.

c. Yes, the debts become demandable because the period established is for the benefit of the creditor.

d. Yes, the debt becomes demandable because the collateral was lost through a fortuitous event.

d. Yes, the debt becomes demandable because the collateral was lost through a fortuitous event.

If redemption is made, which of the following will not be paid by the seller to the buyer?

a. Price paid by the buyer.

b. Expenses in the execution of the sales contract paid by the buyer.

c. All necessary expenses on the thing sold and to be redeemed.

d. Interest of the price paid by the buyer

d. Interest of the price paid by the buyer

A creditor, through a contractual arrangement verbally made within Mr. Benitez, is to receive the rentals of the Benitez apartment buildings in Quezon City with the obligation to apply them to the payment of the interest and thereafter to the principal of his credit. This contract is a valid.

a. Pledge

b. Mortgage

c. Guaranty

d. Antichresis

d. Antichresis

Which of the following is common requisite for Pledge, Chattel, Mortgage and antichresis?

a. The amount of principal and interest must be in writing.

b. The property must be in the possession of the creditor.

c. To bind third person they must be duly recorded in the office of the Register of Deeds.

d. It is constituted to secure the fulfillment of a principal obligation.

d. It is constituted to secure the fulfillment of a principal obligation.

Which of the following is not the subject matter of a chattel mortgage?

a. Interest in business.

b. Growing fruits.

c. Vessels.

d. Shares of stocks.

e. Building of strong materials in which a rice cleaning machinery was installed.

e. Building of strong materials in which a rice cleaning machinery was installed.

The distinction between a chattel mortgage and a pledge is that in chattel mortgage

a. The delivery of the personal property is necessary.

b. The registration of the property in the Registry of Property is not necessary.

c. The excess over the amount due after foreclosure goes to the debtor.

d. Answer not given.

c. The excess over the amount due after foreclosure goes to the debtor.

A bought a refrigerator on installments from B. To secure his indebtedness, A executed a chattel mortgage on the refrigerator in favor of B. Upon default by A on his payments, the refrigerator was foreclosed and sold for P800 which was less than the balance of P1,000 due from A. How much can B still collect from A?

a. P200.

b. P800.

c. P1,000.

d. Nothing.

d. Nothing

Three of the following are essential requisites of a contract of mortgage. Which is not?

a. The person constituting the mortgage has the free disposal of his property

b. The contract must be in writing

c. The mortgagor is the absolute owner of the thing mortgaged

d. The mortgage is constituted to secure the fulfillment of the principal obligation

b. The contract must be in writing

A stipulation where the pledge or mortgagee automatically becomes the owner of the thing pledged or mortgaged.

a. Pactum commissorium

b. Precarium

c. Conventional redemption

d. Assignment of credi

a. Pactum commissorium

Effect of a contract of antichresis if not the principal and interest is not in writing –

a. Valid

b. Unenforceable

c. Voidable

d. Void

d. Void

It is the right of the mortgagor to redeem the mortgaged property after his default in the performance of the conditions of the mortgage but before the sale of the mortgaged property.

a. equity of redemption

b. right of redemption

c. right of pre-emption

d. judicial redemption

a. equity of redemption

The requirement in a contract of pledge so that it will be binding to third persons.

a. Writing

b. public instrument

c. delivery

d. registered

b. public instrument

The following are real contracts, except:

a. deposit

b. pledge

c. commodatum

d. antichresis

d. antichresis

A kind of commodatum wherein the bailor may demand the thing at will –

a. at will

b. pure

c. precarium

d. irregular

c. precarium

The purpose of the contract of deposit.

a. Use

b. Consumption

c. Payment

d. Safekeeping

d. Safekeeping

D pledged his ring to C for P20,000.00. D failed to pay his obligation on time despite repeated demands. C sold it at a public auction for P18,000.00.

a. C can recover the deficiency even without stipulation

b. C can recover the deficiency only if there is a stipulation

c. C can recover the deficiency provided there is reimbursement

d. C cannot recover the deficiency even if there is a stipulation e. C cannot recover the deficiency unless the contrary is provided

d. C cannot recover the deficiency even if there is a stipulation e. C cannot recover the deficiency unless the contrary is provided

A borrowed from B P30,000.00. A offered his specific ring by way of pledge. It was expressly stipulated that upon non-payment of the debt on time, the ring would belong to B. This forfeiture clause, which traditionally is not allowed is called:

a. dacion en pago

b. pacto de retro

c. pacto de non alienado

d. pacto comisorio

e. pacto reiratorio

f. pactum commissorium

g. both c & d

h. both d & f

h. both d & f

D1, D2 and D3 borrowed from C P30,000.00. As a security, they mortgaged their undivided agricultural land to C. Subsequently, D1 paid C P10,000.00. Is the mortgaged on D1’s share extinguished?

a. Yes, payment by one of the debtors extinguished the obligation.

b. Yes, because the obligation is joint and they are liable proportionately.

c. Yes, because of the benefit of division should extend to all the debtors.

d. No, because the obligation is solidary. Payment in part shall not extinguish the obligation.

e. No, because a mortgage is considered indivisible. Payment in part shall not extinguish the obligation.

f. No, because there was no consent of the other debtors.

g. Answer not given

e. No, because a mortgage is considered indivisible. Payment in part shall not extinguish the obligation.

The term credit comes from the Latin term “credere” which means:

a. Trust and confidence

b. Delivery

c. Trust

d. Acceptance

c. Trust

The following are real contracts, except:

a. Commodatum

b. Mutuum

c. Deposit

d. Sale

d. Sale

It is one whereby the bailor may demand the thing loaned at will.

a. Precarium

b. Irregular deposit

c. Consumable

d. Non-consumable

a. Precarium

Deposits of money in banks and similar institutions, such as saving deposits and current account deposits are classified as:

a. Commodatum

b. Mutuum

c. Deposit

d. Assignment of credit

b. Mutuum

A and B entered into a contract of loan without providing that it shall earn interest. When the obligation became due and demandable, can A, the creditor, demand the payment of interest.

a. Yes, it earns legal interest

b. Yes, interest is the accessory and it follows the principal

c. No, since there is no stipulation

d. No, it is usurious interest

c. No, since there is no stipulation

The following are necessary deposit, except:

a. Gratuitous deposit

b. In compliance with a legal obligation

c. On the occasion of any calamity

d. By travelers in hotels or inns

e. By travellers with common carriers

a. Gratuitous deposit

It takes place when an attachment or seizure of property in litigation is ordered.

a. Foreclosure

b. Attachment of credit

c. Judicial deposit

d. Pacto de retro

e. Legal redemption

c. Judicial deposit

A guaranty can secure the following obligations, except:

a. Voidable

b. Future

c. Conditional

d. Unenforceable

e. Void

e. Void

The following are the qualifications of the guarantor, except:

a. Possesses integrity

b. Capacity to bind himself

c. Has sufficient property

d. Must be competent

d. Must be competent

S1 – In commodatum, the loss is suffered by the bailor since he is the owner.

S2 – In mutuum, the borrower need to pay the same amount of the same kind and quality

S3 – In judicial deposit, the purpose of the deposit is to preserve the status quo of the case.

a. All are true.

b. All are false.

c. I/II are true; III is false

d. I/II are false; III is true

e. II/III are true; I is false

f. II/III are false; I is true

g. I/III are true; II is false

h. I/III are false; II is true

a. All are true.

To affect or be binding on third persons, a mortgage contract:

a. Written and duly notarized to be in public instrument.

b. Need not be written since it is already binding on the parties.

c. Must be in public instrument and registered.

d. May be in private instrument but must be registered.

c. Must be in public instrument and registered.

D borrowed a sum of money from C with G as guarantor. The loan is in writing but the guaranty is oral. D failed to pay C, who now is demanding payment from G. Can G be compelled to pay?

a. Yes, because he is the guarantor obliged to pay in case the debtor defaults.

b. No, because the guaranty is void having been orally made.

c. No, because the guaranty is unenforceable against G, it being oral.

d. Yes, because the guaranty is enforceable, writing not needed

c. No, because the guaranty is unenforceable against G, it being oral.

In a real estate mortgage, the mortgagor can sell the property mortgaged:

a. Only if agreed upon.

b. Only if with the written consent of mortgagee.

c. If not prohibited to sell

d. Even without the consent of the mortgagee.

d. Even without the consent of the mortgagee.

Elements of contracts of pledge and mortgage except;

a. Pledgor or mortgagor must be the absolute owner

b. Pledger or mortgagor must have the free disposal of thing pledge.

c. The thing pledge or mortgaged may be appropriated if the debtor cannot pay

d. Pledge and mortgage are accessory contracts.

c. The thing pledge or mortgaged may be appropriated if the debtor cannot pay

A obtained an interest free loan of P50,000 from B evidenced by a promissory note payable six months after date. At maturity A called B by phone to ask for an extension of one month and offer to pay 20% interest on the loan. Enticed by the 20% interest, B agreed to the extension of maturity. Which is correct?

a. The interest is a demandable interest by virtue of an agreement

b. The interest is unenforceable

c. The loan is valid but the interest is void

d. The loan and interest are both demandable

c. The loan is valid but the interest is void

Which of the following is not correct?

a. A movable or immovable property maybe the object of commodatum

b. The bailor in commodatum need not be the owner of the things loaned

c. A stipulation that the bailee may make use of the fruits of the thing loaned is valid

d. The bailor obliged to pay for the ordinary expenses for the use and preservation

d. The bailor obliged to pay for the ordinary expenses for the use and preservation

A borrowed a loan from XYZ Bank for an amount of 1 Million Pesos. A must pay interest to the lender:

a. If there is an agreement in writing to the effect.

b. As a matter of course.

c. If the amount borrowed is very large.

d. If the lender so demands at the maturity date.

a. If there is an agreement in writing to the effect.

Malakas granted a loan to Maganda in the amount of P 500,000.00. Such agreement was not reduced to writing. Malakas demanded interest which was paid by Maganda in cash and checks. The total amount Maganda paid accumulated to P 720,000.00. Upon advice of her lawyer, Maganda demanded for the return of the excess amount of P120, 000.00 which was ignored by Malakas. Is the payment of interest valid?

a. Yes, as they orally agreed to the interest.

b. Yes, because there was demand made by Malakas.

c. No, because interest cannot be due unless expressly stipulated in writing.

d. No, because they did not compute for the interest properly.

c. No, because interest cannot be due unless expressly stipulated in writing.

During a rainy night, Luis checked in at Fairmont Hotel. As soon as he got off from his Honda Civic car, the hotel’s parking attendant got the key of his car and gave him a valet parking customer’s claim stub. What contract, if any, was perfected between Luis and the hotel when he surrendered the key of his car to the hotel’s parking attendant?

a. Mutuum

b. Commodatum

c. Necessary deposit

d. Pledge

c. Necessary deposit

Donnalyn pledged a set of diamond ring and earrings to Alex for P500,000.00 She was made to sign an agreement that if she cannot pay her debt within six months, Alex could immediately appropriate the jewelry for herself. Was the agreement between Donnalyn and Alex valid?

a. Yes, because both parties have the capacity to contract.

b. Yes, because this is a way to satisfy Donnalyn’s debt to Alex.

c. No, because Alex must first sell the jewelry in the mall.

d. No, because, the agreement to appropriate the jewelry upon default is considered pactum commissorium and it is considered void by law.

d. No, because, the agreement to appropriate the jewelry upon default is considered pactum commissorium and it is considered void by law.

On Jay’s failure to pay his loan to DEX Bank, the latter foreclosed the Real Estate Mortgage he executed in its favor. The auction sale was set for Dec. 1, 2020 with the notices of sale published as the law required. The sale was, however, cancelled when Dec. 1, 2020 was declared a holiday and rescheduled to Jan. 10, 2021 without republication of notice. The auction sale then proceeded on the new date. Under the circumstance, the auction sale is:

a. Rescissible

b. Void

c. Unenforceable

d. Voidable

b. Void

A contract of antichresis is always:

a. a written contract

b. a contract with a stipulation that the debt will be paid through receipt of the fruits of an immovable

c. involves the payment of interests, if owing

d. all of the above

d. all of the above

A chattel mortgage can be constituted to secure:

a. Obligation both past and future

b. Obligation existing at the time the mortgage is constituted

c. Future obligations only

d. Past obligations only

b. Obligation existing at the time the mortgage is constituted

A chattel mortgage can cover:

a. Only property described in the deed without exception

b. Can also cover substituted property

c. Properties described in the deed except in case of stock in trade being a substitute

d. After-acquired property.

c. Properties described in the deed except in case of stock in trade being a substitute

Mark constituted a chattel mortgage on a car valued at P1,000,000 to secure a P500,000 loan. For the mortgage to be valid, Mark should have:

a. The right to mortgage the car to the extent of more than half of its value.

b. Ownership over the thing

c. Unqualified free disposal of his car.

d. Registered the car in his name.

b. Ownership over the thing

Franco secured his debt in XYZ Bank by a real estate mortgage. If on the event that Franco defaults, the remedy would be:

a. to foreclose the real estate mortgage.

b. to file an action for collection and then foreclose if collection is not enough.

c. to foreclose the mortgage and demand collection for any deficiency.

d. None of the above.

c. to foreclose the mortgage and demand collection for any deficiency.

The collateral will not be returned until the principal obligation is fully paid.

a. Integrity

b. Individuality

c. Identity

d. Indivisibility

d. Indivisibility

S1 – Foreclosure in pledge is extra-judicial.

S2 – Foreclosure in antichresis is judicial.

S3 – Foreclosure in REM is as a general rule extra judicial.

a. All are true

b. All are false

c. Only S1 is false

d. Only S2 is false

e. Only S3 is false

e. Only S3 is false

S1 – There is deficiency judgment in REM.

S2 – There is deficiency judgment in pledge.

S3 – There is no deficiency judgment under the Recto Law.

a. All are true

b. All are false

c. Only S1 is false

d. Only S2 is false

e. Only S3 is false

d. Only S2 is false

A legal writ authorizing a sheriff to take into custody property in litigation belonging to a defendant until he complies with orders of the court (Art. 2005)

a. Foreclosure

b. Counterclaim

c. Dacion en pago

d. Garnishment

e. Sequestration

e. Sequestration

Who of the following does not enjoy the right of retention, i.e., statutory pledge or statutory lien?

a. A contractor in a contract for a piece of work upon a movable.

b. An agent, unless reimbursed by the principal for necessary expenses and for damages in the execution of the agency.

c. A guarantor, in his exercise of the benefit of excussion.

d. The depositary, in case of voluntary deposit.

e. Hotel keepers, as security of credits extended

c. A guarantor, in his exercise of the benefit of excussion.

The following are requisites of Pledge, except

a. The free disposal of the property by the pledge.

b. Absolute ownership of the property pledged.

c. Thing pledged may be placed in possession of TP

d. To bind a third person, it must be recorded in the office of the Register of Deeds.

d. To bind a third person, it must be recorded in the office of the Register of Deeds.

Which of the following statements is true and correct?

a. Unless otherwise agreed upon by the parties, the sale of the mortgaged property extinguishes in full the obligation of the mortgagor to the mortgagee.

b. Pledge and mortgage are considered principal contracts.

c. When the obligation is secured by a pledge or mortgage and it is not paid when due, the pledgee or mortgagee may dispose the collateral even if there is no agreement to that effect between the parties.

d. In both pledge and mortgage the creditor is entitled to deficiency judgment.

c. When the obligation is secured by a pledge or mortgage and it is not paid when due, the pledgee or mortgagee may dispose the collateral even if there is no agreement to that effect between the parties.

During the bar exam month, Jose lent the car to his girlfriend, Jolie, who parked the car at the Mall of Asia's open parking lot, with the ignition key inside the car. Car thieves broke into and took the car. Is Jose liable to Cruz for the loss of the car due to Jolie's negligence?

a. No, Jose is not liable to Cruz as the loss was not due to his fault or negligence.

b. No, Jose is not liable to Cruz. In the absence of any prohibition, Jose could lend the car to Jolie. Since the loss was due to force majeure, neither Jose nor Jolie is liable.

c. Yes, Jose is liable to Cruz. Since Jose lent the car to Jolie without Cruz's consent, Jose must bear the consequent loss of the car.

d. Yes, Jose is liable to Cruz. The contract between them is personal in nature. Jose can neither lend nor lease the car to a third person.

d. Yes, Jose is liable to Cruz. The contract between them is personal in nature. Jose can neither lend nor lease the car to a third person.

Who enjoys the right of retention?

a. Depositary until full payment of what may be due him in deposit.

b. Lessee if he advances the expenses for the repair of the leased premises.

c. Bailee if bailor owes him something.

d. Builder in bad faith for the recovery of necessary and useful expenses.

a. Depositary until full payment of what may be due him in deposit.

During a rainy night, Luis checked in at Fairmont Hotel. As soon as he got off from his Honda Civic car, the hotel’s parking attendant got the key of his car and gave him a valet parking customer’s claim stub. What contract, if any, was perfected between Luis and the hotel when he surrendered the key of his car to the hotel’s parking attendant?

a. Mutuum

b. Commodatum

c. Necessary deposit

d. Pledge

c. Necessary deposit

This is the right of the mortgagor to redeem the mortgaged property after it was sold.

a. Equity of redemption

b. Right of redemption

c. Right of pre-emption

d. Right of subrogation

b. Right of redemption

Which of the following statements is wrong?

a. Mutuum may be gratuitous or onerous.

b. Only personal property could be the subject of mutuum.

c. The subject matter of mutuum could be money or any consumable.

d. Mutuum is a contract for use.

d. Mutuum is a contract for use.

Which of the following statements is correct?

a. Extrajudicial deposit occurs whenever an attachment or seizure of property in litigation is ordered.

b. There is voluntary deposit if a deposit is made in compliance with a legal obligation.

c. In deposit, depositary must not be the owner of property deposited.

d. Deposits made by travelers in hotels and inns, or by travelers with the common carriers are in the nature of voluntary deposit.

c. In deposit, depositary must not be the owner

In order for a creditor to recover interest, the following requirements must be present, except:

a. The interest must be approved by the court.

b. The payment must be expressly stipulated.

c. The agreement must be in writing.

d. The interest must be lawful.

a. The interest must be approved by the court.

A initially entered into a contract of commodatum with B. After a while, A asked B for a compensation for the use of the loaned property. Here, the commodatum has ceased and new contract was created known as:

a. Deposit

b. Lease

c. Mutuum

d. Sale

b. Lease

D borrows P300,000 from C. To secure payment of the obligation, C required D to deliver his car to him (C), which D did. What is contract created between D and C?

a. Chattel mortgage

b. Pledge

c. Either a pledge or chattel mortgage depending on the choice of C

d. Either a pledge or chattel mortgage according to the choice of D

b. Pledge

The following characteristics apply to real estate mortgage (REM), except:

a. REM is an accessory contract.

b. REM may not guarantee future debts.

c. The objects of REM are immovable properties.

d. Delivery of the object of the contract is not necessary.

b. REM may not guarantee future debts.

If redemption is made, which of the following will not be paid by the seller to the buyer:

a. Expenses in the execution of the sales contract paid by the buyer.

b. Interest on the price paid by the buyer.

c. Price made by the buyer.

d. All necessary expenses on the thing sold and to be redeemed.

b. Interest on the price paid by the buyer.

Statement 1: Consumable goods may be the subject of commodatum.

Statement 2: The pledgor must be the absolute owner of the thing pledged when the principal obligation becomes due and demandable.

a. True, False

b. True, True

c. False, True

d. False, False

a. True, False

The following are real contracts, except:

a. Antichresis

b. Pledge

c. Deposit

d. Loan

a. Antichresis

Purpose of Guaranty

a. consumption

b. use

c. common enjoyment

d. safekeeping

e. indemnify

e. indemnify

Which of the following has no judicial foreclosure?

a. Pledge

c. REM

b. Chattel mortgage

d. Antichresis

a. Pledge

Which of the following has no extra-judicial foreclosure?

a. Pledge

b. Chattel mortgage

c. REM

d. Antichresis

d. Antichresis

Which of the following has no deficiency judgment?

a. Chattel mortgage

b. Pledge

c. REM

d. Anticresis

b. Pledge

Which allows deficiency judgment?

a. TP mortgagor

b. Pledge

c. Recto Law

d. Chattel mortgage

d. Chattel mortgage

S1 – Chattel mortgage allows the right of redemption.

S2 – Real estate mortgage allows the right of redemption.

a. True, False

b. True, True

c. False, True

d. False, False

c. False, True

S1 – Foreclosure in Antichresis is judicial.

S2 – Foreclosure in Pledge is judicial.

S3 – Deficiency judgment is allowed in Chattel mortgage.

S4 – Deficiency judgment is allowed against a TP mortgagor.

S5 – There is redemption in real estate mortgage.

a. Only 1 statement is true

b. Only 2 statements are true

c. Only 3 statements are true

d. Only 4 statements are true

e. All statements are false

c. Only 3 statements are true

S1 – Foreclosure in Antichresis is judicial.

S2 – Foreclosure in Pledge is judicial.

S3 – Deficiency judgment is allowed in Chattel mortgage.

S4 – Deficiency judgment is allowed against a TP mortgagor.

S5 – There is redemption in real estate mortgage.

a. True, True, False, False, True

b. True, False, False, True, False

c. False, True, False, True, False

d. False, False, True, True, False

e. True, False, True, False, True

e. True, False, True, False, True

Which of the following statements is false?

a. Warranty refers to any representation made by the seller of the thing with respect to its character, quality, or ownership, by which he induces the buyer to purchase the same relying on the said representation.

b. Mutuum is a contract where the lender delivers to the borrower money or other consumable thing upon the condition that the latter shall pay the same amount of the same kind and quality.

c. Mortgage is a contract where the creditor acquires the right to receive the fruits of an immovable of his reditor, with the obligation to apply them to the payment of interest, if owing, and then to the principal of his credit.

d. Assignment of credit is a contract whereby one person transfers to another his rights and actions against a third person in consideration of a price certain in money or its equivalent.

e. Pactum commissorium is a stipulation in pledge or mortgage providing that the ownership of the thing given as security will pass to the pledgee or mortgagee upon default of the debtor.

c. Mortgage is a contract where the creditor acquires the right to receive the fruits of an immovable of his reditor, with the obligation to apply them to the payment of interest, if owing, and then to the principal of his credit.

D mortgaged his parcel of land in favor of C as security for his debt. The mortgage is duly registered in the registry of Property. Later, while the mortgage is still effective, D sold the same land to T. Which of the following statements is true?

a. T bought the land subject to the mortgage constituted thereon.

b. T did not acquire the land because it is under mortgage with C.

c. D cannot sell the land because it is under mortgage with C.

d. T is not bound by the mortgage contract between D and because he is a stranger to the said contract.

a. T bought the land subject to the mortgage constituted thereon.

1st Statement: As security for a loan, Sasa mortgaged her house to Baba. Both parties intended to enter into a mortgage contract but the instrument as written states that the house is sold by Sasa to Baba with a right to repurchase. The remedy of annulment of contract is proper.

2nd Statement: If Sasa was borrowing money from Baba, with mortgage of her house as security, and Baba was buying the house of Sasa with right of Sasa to repurchase, the remedy is reformation of instrument.

a. 1st Statement is True; 2nd Statement is False

b. 1st Statement is False; 2nd Statement is True

c. Both statements are True

d. Both statements are False

d. Both statements are False

Where do we apply equity of redemption only?

a. Pledge

c. Antichresis

b. Chattel mortgage

d. Real mortgage

b. Chattel mortgage