Although today access to mortgage loans is very limited, years ago were achievable for many families who are currently very close to paying off their homes.
When the last mortgage payment is reached or an early repayment is made, the question is: “What now?” The truth is the mortgage does not end with the payment of the last installment.
It is true that already nothing is owed to the financial institutionbut according to the housing report issued by the Property Registry, the mortgage is still settled, and this may cause erroneous information in the future.
Mortgage: what is it and what are the rights and obligations of both parties?
A mortgage is a guarantee that the owner of one or more properties grants to a third party (which can be an individual or a bank) to protect the fulfillment of a debtas detailed on the page of the College of Notaries of the City of Buenos Aires.
In this way, the property remains in the possession of the owner and, in the event of non-payment, the creditor is granted the right to collect his credit through the execution of the asset.
Meanwhile, the mortgage is a guarantee given by the debtor in the face of possible non-compliance of the obligations assumed in another contract (for example, a loan of money). And it is only valid if it is constituted by Public deed. The Civil and Commercial Code requires that the property, the creditor and the debtor, and the debt that is guaranteed be identified.
The mortgage covers principal owed and interest subsequent to its constitution, and also the subsequent damages and costs caused by the breach.
The debtor must understand the term of the credit, the amount, the method of payment and the interest, and everything must respond to the agreement. Doubts may be resolved by the authorizing notary, who will also read and explain the content of the deed fully and clearly.
What procedures must be done after canceling a mortgage?
After pay the last installment of the mortgage loanas explained to Clarion the president of the Tariff Commission of the College of Notaries of CABA, María Celeste Gerarduzzi, “we must require the bank to sign the cancellation of the mortgage. Normally a notary will be assigned of the entity, who once the mortgage cancellation deed has been drafted, will contact the bank to sign it”.
“The cancellation of the mortgage is a receipt where the creditor (the bank or an individual), declares that nothing is owed anymore and asks that the mortgage be cancelled”, detailed Gerarduzzi. Later, this deed was register in the Land Registry so that it is free of encumbrances.
Meanwhile, the professional added that the mortgaged property never ceases to be in the name of the debtor, it only has a “notation” that shows that money is owed to a creditor. “This makes if you have to sell itit will have to pay off the mortgage first“, specific.
The process of signing of the deed of cancellation It will depend on when the bank representative signs before the notary public. The subsequent annotation of the cancellation, (process that will be done by the notary public) it takes about a month.
In this context, the notary stressed that “it is very important that when canceling payments, the return of the title of ownership of the property is required because it is customary for the creditor to retain it”.
To make sure that everything has been done correctly, you can also request a simple note from the land registryalthough this procedure is not essential.
How much do I have to pay for the property to remain in my name?
The costs (estimates) are:
- Writing rights ($ 2.400)
- Fixed notarial contributions ($ 1.400)
- sheets ($1,600, prepared sheet $6,000)
- Registration document (between $2,500 and $3,000)
- tax forms ($ 12.000)
- Fixed rate Mortgage Cancellation ($1,500)
“The cancellation of real rights, that is, of the mortgage, has a honorary minimum of $35.000 more him 0,3% about the value of the loan which, if it was in dollars, is applied to the current value on the date of the deed”, indicated Gerarduzzi.
What happens if I finish paying the mortgage and do not do any paperwork?
Las disadvantages They are mainly that before any operation that the person wants to do with the property, the information will still be there.
For example, if you want to sell the property, it will not appear to the buyer that the house is Free of charge when requesting the information from the Land Registry. It will also be a problem if you ever decide to take out another mortgage on the same home.
LN
