Sen. Richard Gordon said Wednesday the newly-signed Free Patent Law will stimulate the economy as it will increase the lending of banks to entrepreneurs using their previously untitled lands for collateral.

Gordon, author and co-sponsor of Republic Act 10023 or the Free Patent Law, said the law will also reduce the risk of fake titling and land frauds.

“This law is a good economic stimulus because the land market, arguably the biggest of the markets in terms of size and value, will perk up, and there will be more land-related transactions and more revenue for government,” Gordon said.

The Free Patent Act, which was signed into law last March 9, extends the grant of free patent, formerly limited to agricultural lands, to residential lands in all municipalities and cities, given certain conditions, without a need for payment to the government.

“The Free Patent Act will pave the way for residential landowners, particularly low and middle income landowners, to title their lands through an easier, speedier and more affordable administrative proceeding,” Gordon said.

“Once they avail of the free patent, many families will be able to sleep better because they have secure titles to their lands. They will be able to obtain loans from their banks if they need to; bequeath the property or divide it among their children if they wish to; and get a higher value for their property because they now have a registered title,” he added.

The Free Patent Act eases the requirements and procedures in the titling of residential lands and bring to life such dormant wealth.

Prior to the enactment of the law, landowners could only acquire title through the court under the present Public Land Act that often resulted in tedious process.