Short answer. No. A stipulation forbidding the owner from alienating the mortgaged immovable is void, so a clause banning sale cannot stop you from selling. The clause falls away while the rest of the mortgage stands, and the lender keeps its security because the charge follows the property to the buyer.
What the law says
A stipulation forbidding the owner from alienating the immovable mortgaged shall be void.
Civil Code, Article 2130 — Void Prohibition on Alienation. Read the full provision →
One sentence, and it is absolute
The rule is stated without qualification: a stipulation forbidding the owner from alienating the immovable mortgaged shall be void. There is no exception for a clause the borrower freely accepted, none for a large loan, and none for wording that says the sale is merely voidable or subject to consent. What the law strikes at is the prohibition itself, not the manner of expressing it. A borrower who signed such a clause is not bound by it, and a lender who drafted it cannot enforce it in court no matter how prominently it appears in the deed.
Why the lender loses nothing
The prohibition is void precisely because it is unnecessary. A mortgage subjects the property itself to the obligation it secures, whoever happens to possess it, so a sale changes the name on the title without touching the charge annotated on it. The buyer takes the land encumbered. If the loan is not paid, the lender forecloses against the same property he always had. Nothing about the transfer weakens his position, which is why the law sees no reason to let him freeze the owner's power to dispose of what remains, after all, the owner's property.
What the clause does to the rest of the contract
Only the offending stipulation is void; the mortgage survives it. That matters in both directions. A borrower cannot argue that the ban tainted the whole instrument and freed him from the loan — the debt and the security remain exactly as agreed. A lender cannot treat a sale made in the teeth of the clause as a breach entitling him to declare the loan due, because there was no enforceable obligation not to sell in the first place. Clauses that dress the same prohibition up as a penalty or an acceleration trigger meet the same objection in substance.
Selling in practice, and what to disclose
You may sell, but you should not sell quietly. The buyer will see the mortgage annotated on the certificate of title, and a sale that conceals it invites a dispute you will lose. The practical route is to tell the buyer what is owed, agree in the deed how the loan will be settled and the annotation cancelled, and time the payments so that release and transfer happen together. Bring the mortgage instrument and the registry's copy of the title to whoever advises you — the clause's wording matters less than what the title currently shows.
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.
- Reynaldo K. Litonjua, et al. vs. L & R Corporation, et al, G.R. No. 130722, December 9, 1999 — read the decision on LawPhil →
- Philippine Charity Sweepstakes Office (PCSO) vs. New Dagupan Metro Gas Corporation, et al, G.R. No. 173171, July 11, 2012 — read the decision on LawPhil →
- Spouses Nestor Cabasal and Ma. Belen Cabasal vs. BPI Family Savings Bank, Inc., G.R. No. 233846, November 18, 2020 — read the decision on LawPhil →
- Pablo P. Garcia vs. Yolanda Valdez Villar, G.R. No. 158891, June 27, 2012 — read the decision on LawPhil →