In the acquisition of real estate, there are several types of guarantees, being the mortgage on real estate one of them.
When acquiring a property in the plant, as it is common to find in the registration the existence of the mortgage lien.
This type of guarantee usually arises when developers borrow money from banks in order to carry out a venture.
Thus, builders and developers offer the project to be built as a guarantee.
For this reason, therefore, in the registration of the property to be incorporated there is a mortgage in guarantee.
But the time will come for the developer to sell these real estate units and buyers will need to lower the mortgage in order to register the property in their name.
What is needed to secure a mortgage loan?
So, read this article and learn more!
What is the purchase and sale contract?
First, it is important to remember that the real estate mortgage, in this case, will arise in the context of a property purchase and sale contract.
So what is the purchase and sale contract?
In short, buying and selling real estate is a type of contract. On the one hand, therefore, the seller is obliged to transfer ownership of the property to the buyer. While, on the other hand, the buyer is obliged to pay the agreed price for the purchase of the property. Therefore, both seller and buyer have obligations to fulfill.
Read more about this subject in the article What Data Must Be in the Purchase and Sale Agreement?
What are the main ways to celebrate the purchase and sale?
Well then, the purchase and sale contract can be entered into through a private or public instrument.
In addition, in the purchase and sale of properties on the plant, it is common to enter into contracts in the form of a private instrument. Thus, these types of contracts are made directly with developers and financial institutions.
This type of property purchase and sale agreement has the effect of a public deed under the law. Because, they are usually made with fiduciary sale in guarantee.
The public instrument, therefore, is entered into before a notary public and is called a public deed of purchase and sale.
However, both the private and the public instrument need to be registered in the property registration for the transfer of ownership to take place.
What is a property on the plant?
One of the types of real estate in the real estate market is the on-plan property; but what does immobile in the plant mean?
In summary, the property on the plan is one for which construction has not been completed, but only approved in design. Therefore, in these cases, either the work has not started or is still in some of its phases.
In real estate developments, therefore, it is common to sell this type of property. In other words, once the real estate development is registered, it is authorized to sell them through purchase and sale commitment contracts.
As the completion of the work is a future promise, then, it is common for developers to finance the construction of the project. Furthermore, it is normal for developers to offer their own project as a guarantee.
Can the construction company mortgage the properties on the plant?
Thus, one of the ways to obtain funds for the construction of the project is through financing. And, normally, developers use the mortgage as collateral, in addition to the development’s real estate. Thus, the developers take out bank loans to complete the works.
Thus, all property registrations are recorded with mortgages in favor of the banks.
Indeed, this is legal and normal practice in the real estate market.
But the property already sold cannot continue guaranteeing the debt of the construction company with the bank.
Therefore, the buyer can and should take steps to secure his property. So the question arises: how to lower the mortgage on the property on the plant?
Can the buyer ask for the write-off of the mortgage on his property? In which case?
At first the answer is yes and, mainly, the acquisition of the property was paid off.
On the subject, the Superior Court of Justice approved Precedent No. 308, which reads as follows:
“THE MORTGAGE ENTERED INTO BETWEEN THE CONSTRUCTOR AND THE FINANCIAL AGENT, BEFORE OR AFTER THE CELEBRATION OF THE PURCHASE AND SALE PROMISE, IS NOT EFFECTIVE BEFORE THE PURCHASERS OF THE PROPERTY. ”
What, then, is the meaning of Precedent 308?
First, that the mortgage signed in favor of the creditor is not effective against the buyer of the property. This is because it was not the buyer who contracted the mortgage or agreed to it.
In other words, the mortgage lender cannot take the buyer’s property just because the property was offered to him as collateral by the construction company. Therefore, as described above, this is true even if the property was purchased after the mortgage was established.
But then, there is no risk of the buyer losing the property to the mortgage lender. It depends!
Although the mortgage signed between the construction company and the financial agent is not effective against the buyer, it remains valid.
So the buyer runs the risk of losing the property to the mortgage lender. But in what situation is there this risk? For example, if the mortgage lender takes over the seller’s credit and the acquirer defaults. Then, the mortgage lender will be able to execute the acquirer and even satisfy this credit with the property.
If a person plans to purchase a property, but this property has a mortgage on its registration, he or she needs to look for a professional to analyze the business risks.
How to lower the mortgage on the property registration?
In cases of settlement of the promise to buy and sell the seller, for example, the seller must grant the public deed. Because, this document is essential to enable the transfer of ownership of the property to the buyer.
In addition, she must provide the mortgage payment term to lower the mortgage on the property’s registration.
With these documents, the buyer goes to the Real Estate Registry. Thus, it asks for the registration of its property and the write-off of the mortgage on the property.
What if the homebuilder does not provide the mortgage payment term?
Well, if the builder does not spontaneously provide the mortgage settlement term, the buyer can notify the builder and the mortgage lender (banks) informing the settlement of the property price and requesting the mortgage settlement term pursuant to Precedent 308 of the STJ.
However, if even after notification, neither the construction company nor the bank provide the term of discharge, the solution is to file a lawsuit.
The lawsuit will be filed against the two so that they provide the term of payment of the mortgage so that the lien can be written off.
Thus, after providing the term of discharge, it must be taken to the Real Estate Registry for the respective mortgage write-off.
Therefore, if you have purchased a property in the plant and this property is registered with a mortgage, look for our office and schedule an appointment. Thus, you will be able to find out more details on how to lower the mortgage on the property, even in cases of refusal by the seller or bank.