Compulsory security mortgage what now?
Selling a mortgage with compulsory security
Are you a creditor and have obtained a mortgage by way of compulsory security in the land register of a debtor as a result of an ex officio application or as a result of compulsory enforcement? But what happens next? There are numerous steps to follow and various authorities and lawyers to speak to. We explain below how you can monetise your compulsory security mortgage.
BY SELLING YOUR CLAIM / MORTGAGE YOU HAVE THE FOLLOWING ADVANTAGES:
- Your compulsory mortgage sale at a fixed price to Wienroth Immobilien
- Fast and uncomplicated processing
- No costs for lawyer, court, surveyor and authorities
- Purchase price payment within 21 days of the due date
- No risk of realisability
- Fast liquidity without effort
- Carefree handling by Wienroth Immobilien
HOW CAN I TURN A MORTGAGE INTO MONEY?
The good news is that we will buy your mortgage with compulsory security at a fair price.
Thanks to our many years of experience in the legal and property sector, we can already look back on a large number of successful debt purchases throughout Germany.
HOW A MORTGAGE BY WAY OF SECURITY WORKS
Compulsory security mortgages are the result of an enforcement procedure. They are often used when there is no other way of accessing attachable property that can be expected to realise the seized amount more quickly. However, it is not easy to apply for compulsory security mortgages and have them entered in the land register. The compulsory security mortgage applied for by the creditor is one of the most important instruments in the area of property enforcement if a forced sale is to be avoided and an enforceable claim is to be secured.
In contrast to an immediate auction, if the creditor registers a compulsory security mortgage, the attached owner can continue to live in the property. However, realising a compulsory security mortgage costs a lot of time and money - a reason for many people to refrain from doing so. If you as the creditor have a compulsory mortgage registered, the debtor bears the costs of the entire procedure. They must pay the costs plus the titled claim. However, they have until the end of the compulsory mortgage realisation to do so.
CLAIM SETTLED - HOW TO CANCEL YOUR COMPULSORY SECURITY MORTGAGE
To cancel a compulsory security mortgage, you as the creditor must agree and confirm that the claim has been repaid in full, including all interest. Once it has been cancelled from the land register, the entry is still visible unless cancellation without arrears is requested.
While cancellation with your consent as the creditor is relatively quick and inexpensive, further costs, including interest, will be incurred if cancellation of the compulsory security mortgage is requested.
An alternative to cancelling the compulsory security mortgage, for which a notary is required, can be the transfer to an owner mortgage. This means that the entry remains in place, but the security option is transferred to the owner.
You save the fees for cancellation and have the option of remortgaging the existing - and settled - mortgage at any time. This method can also be used to secure a reorganisation loan.
CANCELLATION OF A MORTGAGE WITH COMPULSORY SECURITY - WHO BEARS THE COSTS
The costs for the cancellation of a compulsory security mortgage are to be borne by the former debtor. You can find out how high the fees are for the cancellation of a compulsory security mortgage from the relevant land registry office. However, further costs will be incurred if the owner wishes to have the mortgage cancelled completely after the amount has been paid.
Nevertheless, this measure is recommended for any owner who is planning to sell their home or would like to secure a future loan against their property. Both the costs of registration and the fees for the cancellation of a compulsory mortgage are borne by the debtor and are associated fees for enforcement. If a forced sale takes place, the registered mortgage can be cancelled
WHO CAN APPLY FOR A COMPULSORY SECURITY MORTGAGE
Compulsory security mortgages are based on an application procedure and presuppose that the applicant is authorised to enforce the claim amount.
Due to the high administrative costs at the land registry and the effort involved, which should not be underestimated, a minimum debt amount of EUR 750.01 must be available for registration. The application will only be granted if the debtor is the sole owner or co-owner according to the land register.
DISADVANTAGES OF A MORTGAGE BY WAY OF SECURITY
In many cases, it is a lengthy and costly process to turn your claims into cash. In most cases, the realisation of a mortgage by way of compulsory security involves auctioning off the debtor's entire property. A more serious case is when you can only enforce a co-ownership share: Then only this share is up for auction in the first instance. If there are also prior registrations whose valuation is uncertain, you will quickly reach the limits of realisability.
In addition, costs are incurred at court, at the land registry, for an expert and for a lawyer.
The time frame for such a realisation is difficult to predict. In many cases, several years pass with uncertain prospects of success.
WIENROTH IMMOBILIEN - YOUR EXPERT AND CONTACT PARTNER
We can help you quickly and easily and buy your enforceable claim with the compulsory security mortgage at an agreed fixed price. This debt purchase is notarised. We bear all the costs involved. This saves you the costs of a lawyer, court, land registry, surveyor and authorities.
Wienroth Immobilien will take care of this for you.
You will receive the purchase price within 21 days after notarisation and after the notary has given the "green light". Please note that the processing times of the land registry offices vary and can only be influenced to a limited extent.
Benefit from the fact that we relieve you of the risks associated with a mortgage with compulsory security , e.g. the worry about further realisability. This means that you are liquid again without any effort and no longer have to deal with the matter.
FAQ - Compulsory security mortgage
1. WHAT IS A COMPULSORY SECURITY MORTGAGE?
A compulsory security mortgage is a security interest in real property. The creditor has a mortgage entered in the land register to the detriment of the debtor as part of enforcement proceedings.
2. DOES IT MAKE SENSE TO REGISTER A MORTGAGE BY WAY OF SECURITY?
A compulsory security mortgage is not voluntary and can only be obtained by court order. It gives the creditor security over a certain amount of the debtor's property. It can therefore be very useful to register a mortgage to secure your claims. Its value depends on the value of the property and the existing encumbrances.
3. WHAT ARE THE REQUIREMENTS FOR A COMPULSORY SECURITY MORTGAGE?
A mortgage by way of security requires an enforcement title, e.g. a court judgement. The application for entry in the land register is usually made by the creditor's legal advisor.
4. WHAT DOCUMENTS ARE REQUIRED FOR A MORTGAGE BY WAY OF SECURITY?
Firstly, a property description must be available, as well as all details of the debtor, the creditor and any other debtors. The compulsory security mortgage is then registered at the relevant land registry. The land registry requires an enforceable title for this, e.g. a court judgement. Important: The original enforcement title must be submitted to the land registry.
5. who bears the costs for the registration of a mortgage by way of security?
Normally the registration fee is €750.01. Various enforcement titles result in the complete enforcement. For example, this can be a judgement and a cost assessment order. Enforcement costs and interest incurred to date may also be added.
6.WHO BEARS THE COSTS OF CANCELLING A MORTGAGE BY WAY OF SECURITY?
Once the liabilities have been repaid, the mortgage is cancelled from the land register. The resulting notary and court costs are usually borne by the debtor.
7. HOW CAN A MORTGAGE BY WAY OF SECURITY BE CANCELLED?
The debtor can apply to the competent court for cancellation of the mortgage by providing proof of repayment of the outstanding debts. The court will then arrange for the mortgage to be cancelled in the land register. However, the cancellation can also take place in connection with a forced sale.
8. WHEN MUST A MORTGAGE BY WAY OF SECURITY BE CANCELLED?
The right to cancellation exists if the priority notice was entered before the mortgage. In § 888 I BGB you will find all current information on the right to consent to the cancellation of the compulsory security mortgage.
9. WHAT LEGAL FRAMEWORK CONDITIONS SHOULD I OBSERVE IN THE CASE OF A COMPULSORY SECURITY MORTGAGE?
A compulsory security mortgage is an involuntary mortgage that is applied for by the creditor in the course of enforcement proceedings. When the debtor repays the debt, the mortgage is cancelled from the land register.
10. DOES A COMPULSORY SECURITY MORTGAGE HAVE TO REMAIN IN THE LAND REGISTER DESPITE CANCELLATION?
Entries that have been completed are cancelled, but not removed from the land register. For reasons of clarity, these are marked in red and provided with a cancellation note. In this way, even unpleasant entries remain visible in the land register.
11 What is the difference between a compulsory mortgage and a compulsory security mortgage?
There is none. The compulsory mortgage is also known as a compulsory security mortgage. In property law, it is referred to as a security mortgage. It is entered in the debtor's land register by law or in the course of compulsory enforcement. The entry is made at the request of the creditor.
12 What types of security mortgages are there?
There are two main types of chattel mortgage: the builder's chattel mortgage and the maximum amount mortgage.
In the case of the builder's security mortgage, the land register entry is in favour of the builder - in the event that the construction work has actually been carried out. In addition, no client payments may have been made. Payment delays must also not occur.
With this security mortgage, only the building contractor has a claim. In this way, the payment of the building tradesmen is secured.
With the maximum amount mortgage, the maximum amount of the property liability is determined and recorded in the land register. Interest on the debt is calculated on the basis of the maximum amount.
13 What is a creditor according to the land register?
A creditor is the creditor or lender. He wants collateral for the money lent. A mortgage is available to him for this purpose. Debts (mortgages, land charges or pension debts) are recorded in section III of the land register.
The processes surrounding a mortgage as security are complex and multi-layered. As a creditor, you have a lot of work to do, be it with the land registry, lawyers or various authorities. Let us provide you with professional support in these matters.
Wienroth Immobilien is there for you if you have any further questions on the subject of compulsory security mortgages. We are familiar with all matters and stumbling blocks relating to forced security mortgages. In the Free State of Thuringia, we have already supported numerous creditors in the past and are recognised as a reliable partner. Regardless of whether you have fundamental or detailed questions: Give us a call. Benefit from the enormous relief we offer and put your trust in our many years of expertise. Wienroth Immobilien - your reliable partner when it comes to foreclosure mortgages.
