From this act of receiving delayed payment, it is clear that the respondent bank had waived its right under the acceleration clause so that instead of claiming penalty charges on the entire amount of P4,500.00, it only computed the penalty based on the defaulted amortization payment which is P1,018.14. If it computed the penalty charge at 19% of the entire amount of P4,500.00 which would have been due and demandable by virtue of the acceleration clause, the penalty charges would be much more than P25.20.

This is similarly observed in payments which the respondent bank received on June 6, 1978 and August 26, 1978. We also noticed that in Exhibit “D-3”, the receipt which the respondent bank issued to petitioner for the August 26, 1978 partial payment, it waived its right under Article 1253^[7] of the Civil Code on Application of Payments when it applied the payment to the principal instead of the interest. Thus, on that date the outstanding obligation of petitioner was already reduced to P3,558.21 after she had paid a total of P2,200,00 over a period of nine months from the time the loan was obtained.

From this conduct of the respondent bank it is clear that it neither enforced its right under the acceleration clause nor its right to foreclose under the mortgage contract. For more than four years, the respondent bank made petitioner believe that it was applying her payment on the loan and interest just like before when the respondent bank accepted such payment and issued a receipt therefor. It is bound by estoppel to apply the same as payment for petitioner’s obligation as it did when it received previous payments on three occasions. Its act of applying said payments to accounts payable is clearly prejudicial to petitioner. We cannot countenance this act of the bank.