REGISTRATION OF SALES
1. Documents for sales. What type of documents does your LR system envisage for sales and carrying out their registration?
We daresay that public document is necessary for registration.
As for registration of foreign deeds, there is further information in CROBECO questionnaires.
2. Method of registration. Please, indicate which of these circumstances or data form part of the content of the registration annotated in the registration books or land books for sake of a sale or conveyance.
Registration of sales is basically adjusted to the principles above mentioned.
It’s remarkable that it’s necessary, in case of married people, to state what the matrimonial regime is. It will form part of the registered title and obviously will condition the authority of disposal on the real estate or property bought.
There are some requirements for deeds about the form or way to pay the price (cash, check, bank transfer) for further reasons of policy about money laundering.
REGISTRATION OF MORTGAGES
1. Please, indicate what main legislation governs mortgages in your system.
Main legislation in Spanish LR system is comprised of Mortgage Act and a Regulation for its application (respectively Ley Hipotecaria and Reglamento Hipotecario). There are other important Acts that partially govern LR matters, for instance Civil Procedure Act (Ley de Enjuiciamiento civil) as for foreclosure.
2. In your LR system, is the registration of a mortgage constitutive?
In Spanish LR system the registration of a mortgage is constitutive, what it is the most important exception for a system based on declarative registration.
3. Documents. What type of documents your LR system admits for establishing mortgages and carrying out their registration?
Documents. Basically, mortgages must be granted in public document (Authentic Instrument issued by Notary) to be registered.
4. Method of registration. Please, indicate which of these circumstances or data form part of the content of the registration annotated in the registration books or land books.
Legal content of registrations of mortgages must comply certain requirements in accordance with Spanish Mortgage Act.
- First, mortgage in Spanish LR depends necessarily on the obligation ensured, which must be clearly identified (a loan, a credit line, a bank account, an endorsement, a bill of exchange and so on).
- The registration of a mortgage property right will include the main debt amount. If necessary, agreed-upon interests or themaximum amount of the mortgage liability will be also included. It’s necessary to itemize each one of these sums or maximums and also whatever debt or liability guaranteed by the mortgage. [You will find a text like that: Mr. X, owner, grants in favour of Bank X a mortgage related on this property for guaranteeing: 100.000 € of main amount of loan; up to 7 % of this amount for interests of one year; up to13 % for interests for late payment of two years; up to7% for judiciary expenses. These figures are the maximum of the mortgage liability and, we insist, shall be itemized or separated, never mixed in a global responsibility. Distribution of liability is also relevant for foreclosure].
- Obligation or debt guaranteed by mortgage must have a deadline or duration.
- In case of mortgages whose mortgagees are one of the entities within the Mortgage market Regulation (Banks and so on, then majority of mortgages) also will form part of the registration as clauses related to early termination of the obligation asother financial terms. However, several Spanish Acts and Supreme Court judgments have limited the registration of certain financial clauses.
- Registration usually contains agreements between mortgagor and mortgagee about foreclosure.
5. Types of mortgages. If you believe it appropriate, indicate the kinds of mortgages which are relevant in your LR system.
Spanish legislation envisages several types of mortgages, for instance:
- Mortgages to guarantee loans (common loans).
- Mortgages to guarantee credit accounts (credit facilities, credit lines).
- Mortgages to guarantee transferable bills by endorsement (among them, bills of exchange) or bearer certificate.
- Mortgages to guarantee periodic rents or profits. (For instance, alimonies or pensions.)
- Limited mortgages, so that the creditor legally shan’t be entitled to call for more money than the amount resulting from the auction at most. (Liability shall be covered exclusively by mortgaged assets and shan’t affect other assets which the debtor or borrower owns. Rights or powers of the creditor or lender shan’t reach them.)
- Inverse mortgages. An owner of certain properties mortgaged (usually retired or elder people) is entitled to take money out of a bank account by means of successive provisions, generating a debt. When this owner passes away, either his/her heirs will accept to pay the mortgage or the creditors are entitled to rely on foreclosure in order to compensate that debt.
6. Modifications. What does your legal system envisage about modifying mortgages? Do debtors have any legal possibility of negotiating newly the terms of the contract or any part of them?
It’s very important, even from a social point of view, to stress that in Spain, 2/1994 Act (about modification of mortgage loans) grants some rights to debtors or mortgagees in order to improve financial terms of the loans or credits. Basically, the idea is that if debtor found a better offer in other Bank, he would move out this mortgage here without a great expense, unless the first Bank improved the terms.
It turns out a display of an idea about portability of the mortgages.
REGISTRATION OF JUDICIARY CHARGES
1. What kind of orders or judgments can create, modify or cancel an entry in your LR system ?
- In Spanish LR system certainly different types of judicial orders are presented for registration. These ones are some common orders (but there are some more):
- Judicial orders of provisional measures to attach restrict disposition acts or freeze the assets of the debtor.
- Judicial decisions in foreclosure proceedings.
- Judicial decisions transferring the ownership or recognizing the property or other real rights on an immovable asset that can directly create, modify or cancel and entry in the land registry.
- Judicial decisions ordering rectification of an entry in the Land Registry
- Judicial decisions about insolvency of owners or holders of property rights or rights in rem.
2. What’s the kind of registrations or entries caused in registration books or land books by these judiciary orders or decisions?
As a general rule, these judicial writs or orders cause a kind of entry, a caveat or preventive annotation (anotación preventiva).
If the order is not otherwise provided, they shall have got a deadline for 4 years. If the case hasn’t been decided after expiring this period or the reason for the order still remains, may be extended for 4 years longer by means of a new judicial order or writ. If applicable, it will be necessary the new order (setting the extension) to be presented in the Land Registry before expiring totally the deadline of the annotation firstly carried out.
3. In particular, are creditors-plaintiffs who demand payments of sums or money entitled to rely on the Courts and apply for annotations (caveats) or judiciary mortgages in order to attach debtors’ assets?
For those cases in which someone relies on demanding a payment of sums of money through a legal action before Judges and Courts, Spanish Mortgage Act doesn’t envisage a judiciary mortgage unlike other systems.
To ensure sums of money while cases or procedures are pending, the plaintiff or creditors may request to Court a suitable order of attachment (usually called mandamiento de embargo) that will lead in the Land Registry to make a temporary registration which involves attachment of defendant’s properties, preventive annotation or caveat called anotación preventiva de embargo.
This LR mean will be in force for the deadline provided by Court and if it is not provided, for a period of 4 years that can be extended, as above mentioned.
It’s important to make clear that according to Spanish Mortgage Act, attached properties can be transferred without prejudice to the right of the person in favour of whom the attachment is made.