iRealtee OS Glossary

PDC (Post-Dated Check)

You issue PDCs at the start of your property purchase to cover your payment schedule. Here is how the process typically works:

PDC (Post-Dated Check)

PDC (post-dated check) is a payment instrument dated for a future date that a buyer issues to a seller or developer to cover scheduled installment payments in a real estate transaction. In Philippine property sales, PDCs serve as both payment commitment and security for sellers, with each check deposited only on its specified date.

Key Components

  • Check date: The future date when the check becomes valid for deposit
  • Payee name: The seller, developer, or designated receiving party
  • Amount: The installment payment due on that specific date
  • Account number: The buyer's bank account from which funds will be drawn
  • Signature: The buyer's authorized signature validating the instrument

How PDCs Work in Philippine Real Estate

You issue PDCs at the start of your property purchase to cover your payment schedule. Here is how the process typically works:

  1. Contract signing: After signing the Contract to Sell, you receive a billing statement showing all installment due dates.
  2. Check preparation: You write a series of checks—one for each monthly or periodic payment—dated for each due date.
  3. Submission: You submit all PDCs together with your Buyer Information Sheet and other required documents.
  4. Deposit process: The seller deposits each check on its specified date. Payment is complete only when the check clears.
  5. Tracking: Developers use payment tracking systems to monitor which PDCs have cleared and which are still pending.

Under Philippine jurisprudence, issuing a check does not constitute payment. Payment occurs only when the bank honors or clears the check.

Pros & Cons

Advantages:

  • Provides a structured payment schedule for buyers
  • Reduces the need for monthly manual transactions
  • Gives sellers predictable cash flow and collection schedules
  • Creates documentation for both parties

Disadvantages:

  • Bounced PDCs can trigger criminal liability under Batas Pambansa Blg. 22
  • Requires maintaining sufficient funds in your bank account across multiple months
  • Lost or stolen PDCs create security risks
  • Some banks charge fees for each check issued

Real-World Application

In Philippine real estate, developers like Ayala Land, SMDC, Megaworld, and DMCI Homes require buyers to submit 24 to 60 PDCs (or more) covering the equity period or entire amortization schedule.

Real estate platforms like iRealtee help brokers and developers manage PDC collections through payment tracking and accounts receivable modules. These systems:

  • Track which PDCs have been deposited and cleared
  • Send automated reminders to buyers before check dates
  • Flag accounts with dishonored checks
  • Generate billing reports for collection follow-up
  • Integrate with accounting software for reconciliation

If your PDC bounces, you risk both civil liability (collection suits) and criminal prosecution under BP 22. However, the Maceda Law protects buyers who have paid at least two years of installments by granting grace periods and refund rights before contract cancellation.

References

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