Today, practically all of us have ever said the phrase “I’m going to ask for a mortgage”. At the same time, we must recognize that nobody likes the word “mortgage”, since it ultimately implies, as a general rule, spending a more or less long period of time paying back an amount of money that they have lent us. But at the same time we have to be aware that thanks to “mortgages” we can borrow money and that they grant it to us at relatively low interest rates if we compare them with purely personal loans. This is thanks to the security provided by the intervention of Notaries and the proper functioning of the Property Registries in Spain. So Not everything is bad.
Without going into great technicalities, we must know that a mortgage, strictly speaking, is a security right. A mortgage, as a general rule, usually guarantees the repayment of a loan, that is, the return of money that they have lent us. Its operation is simple: the mortgage is constituted on a property, so that if we stop paying back the money that they have lent us, the creditor (a bank as a general rule) will be able to foreclose on that mortgaged asset to recover the amount that we still owe. If the amount of the execution of the property is enough to pay what is owed, our debt is paid but we will have lost the property; If more is obtained than what we owe, the debt will be paid, they will give us the surplus but we will have lost the property; and if the amount of the foreclosure does not reach us to cover what we owe, we will have lost the mortgaged property and we will also continue to owe the remaining amount of the debt with all our present and future assets. All this as a general rule.
Another characteristic aspect of mortgages, at least for people not related to the legal world, is that they are somewhat complicated to understand. How the mortgage works, the appraisal of the property, the interest rates of the loan attached to the mortgage, the monthly payments, maturities, foreclosures, among other aspects, are questions that not everyone understands easily, of course, and they need to be explained. Currently in Spain, banks, due to some “sticks” that have been carried in the past, explain in a fairly detailed way all the characteristics and conditions of mortgages. But let us not forget that the banks do not cease to be an interested party, they are the creditors, and that is why the mandatory and necessary intervention professionals who are excellently trained and prepared to explain this type of operations and who are also impartial. Those professionals they cannot be other than the Notaries.
Currently, and since the entry into force of the Law 5/2019 of March 15, when a bank grants a natural person a mortgage loan for the acquisition of a property intended for residential use in which the same property or another that is intended for housing is mortgaged, the borrowers and the mortgagers (to the persons to whom they leave them the money and the owners of the property that is mortgaged, which in many cases coincide), they must appear in front of the notary that they freely choose, so that he explains in detail all the characteristics of the mortgage loan. Only the borrowers and the Notary Public are present in this advice, but not the Bank.
All this is carried out through a acta, In which you can ask the Notary all the questions you have about the mortgage, so that all your doubts are resolved and all this before the day the mortgage loan is signed with the bank. Specifically, this advice will have to be carried out within the within 10 days counting from when all the documentation has been delivered to the borrowers and the Notary has available to review it. The mortgage loan can only be signed when these ten days have passed, so that borrowers have received quality, unbiased notarial advice and enough time has passed for them to think about their mortgage decision.
Obviously the day of signing the mortgage loan, the Notary will read again and explainr everything related to the loan mortgage to be signed, in this case in the presence of both the bank and the borrowers. Therefore we have a double check notarial: first in the individualized advice to the borrowers by the Notary Public, and second on the day of signing the mortgage loan.
Mortgages involve a tough commitment, but they have great benefits, they allow, on many occasions, to build our projects for the future. Notarial advice is your right, and Notaries intervene here to give you the greatest possible peace of mind and clarity in such an important decision.
JUAN ENRIQUE COSTA NINOT – NOTARY OF GÁLDAR
–
