Dear PAO,

I secured a car loan from a reputable bank sometime in 2019. I religiously paid all of the monthly installments except for the months of April 2020 and May 2020, as I remember having read online that all monthly payments falling due within the period of the enhanced community quarantine were waived by virtue of the “Bayanihan To Heal as One Act.” To my surprise, I received a notice from the bank demanding the respective monthly installments. Do I still need to pay them, considering that these payments were due during the enhanced community quarantine? Please enlighten me. Thank you.

Jerrvee

Dear Jerrvee,

Yes, you still need to pay the monthly installments, notwithstanding the fact that these payments were due and demandable during the implementation of the enhanced community quarantine.

Be reminded that Section 4 (aa) of Republic Act (RA) 11469, or the “Bayanihan To Heal as One Act,” simply directs all banks to implement a minimum of 30-day grace period for the payment of all loans falling due within the period of the enhanced community quarantine, to wit:

“Section 4. Authorized Powers – Pursuant to Article VI. [Section 23] (2) of the Constitution, the President is hereby authorized to exercise powers that are necessary and proper to carry out the declared national policy. The President shall have the power to adopt the following temporary emergency measures to respond to crisis brought by the pandemic: Xxx

“(aa) Direct all banks, quasi-banks, financing companies, lending companies, and other financial institutions, public and private, including the Government Service Insurance System Social Security System and Pag-ibig Fund, to implement a minimum of a thirty (30)-day grace period for the payment of all loans, including but not limited to salary, personal, housing, and motor vehicle loans, as well as credit card payments, falling due within the period of the enhanced Community Quarantine without incurring interests, penalties, fees, or other charges, persons with multiple loans shall likewise be given the minimum thirty (30)-day grace period for every loan;

xxx”

Stated differently, the “Bayanihan To Heal as One Act” simply extends the due date of your monthly installments, falling within the enhanced community quarantine, for at least 30 days. This grace period should not be construed as condonation of your monthly installments to the bank, but rather a mere suspension of your monthly payment. As a form of social amelioration of the societal condition during the enhanced community quarantine period, the law prohibits the incurring of interest, penalties, or other charges, for payments made within the grace period required by the law.

Thus, in your case, you are still obliged to pay your monthly installment to the bank for the months of April 2020 and May 2020 as these were neither waived nor condoned. Your obligation to pay was merely suspended during the period that the enhanced community quarantine was in effect. Please be advised that the provisions of the “Bayanihan To Heal as One Act” were effective from March 25, 2020 to June 25, 2020. (Section 9, Republic Act No. 11469)

We hope that we were able to answer your queries. This advice was based solely on the facts you have narrated and our appreciation of the same. Our opinion may vary when other facts are changed or elaborated.

Thank you for your continued trust and support.

Editor’s note: Dear PAO is a daily column of the Public Attorney’s Office. Questions for Chief Acosta may be sent to [email protected]