Short answer. Yes. Under the Civil Code, obligations and actions whose object is a movable or a demandable sum of money are classified as personal property, the same broad category as shares of stock. Because a debt owed to you is exactly that kind of obligation, it is personal property you can generally assign or sell.
What the law says
Obligations and actions which have for their object movables or demandable sums
Civil Code, Article 417 — What Else Is Personal Property. Read the full provision →
Why a debt counts as personal property
The Civil Code's list of what else counts as personal property is short but direct. It includes obligations and actions which have for their object movables or demandable sums, alongside shares of stock in agricultural, commercial, and industrial entities even when those entities own real estate. A debt someone owes you, the right to demand payment of a specific sum, fits squarely inside this description: it is an obligation whose object is a demandable sum of money.
This is why lawyers refer to a right to collect a debt as a credit, and treat it as an asset in its own right, separate from whatever transaction originally created it.
Why the classification matters
Classifying a debt as personal property is not just a label. It is what lets a creditor treat the right to be paid as something that can be owned, valued, and transferred, the same way one can sell a car or a piece of furniture. Without this classification, the only way to realize value from a debt would be to wait for the debtor to pay it directly.
It also affects how the credit is treated in other legal contexts, such as inclusion in an estate, in the assets available to a creditor's own creditors, or in a partition among co-owners of the credit.
Selling or assigning a debt in practice
Because a debt is personal property, a creditor can generally transfer the right to collect it to someone else, commonly through an assignment of credit. The buyer or assignee then steps into the creditor's shoes and becomes the one entitled to demand payment from the debtor, subject to whatever defenses the debtor could have raised against the original creditor.
Whether a particular debt can actually be sold, and on what terms, depends on the nature of the obligation and any restrictions attached to it, so the specific facts of the debt matter before assuming a sale is straightforward.
What this does not automatically resolve
Recognizing a debt as personal property does not by itself tell you how much it is worth to a buyer, whether the debtor must be notified for the sale to bind them, or whether any special rules apply because the debt is already the subject of a lawsuit. Those are separate questions that depend on the specific facts of the debt and how the transfer is carried out.
Anyone looking to sell or buy a debt should have the underlying obligation and any documentation reviewed first, since defects in the debt itself, or in how it is assigned, can affect whether the buyer actually collects.
Cases citing this provision
These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.
- Fort Bonifacio Development Corporation vs Valentin Fong, G.R. No. 209370, March 25, 2015 — read the decision on LawPhil →