What is a mortgage cancellation ?
It is an operation that is carried out between the debtor party, which is the one that has the debt, and the creditor party, to which the debt is owed, regarding the outstanding payment. With this mortgage cancellation, as the word suggests, we manage to cancel the outstanding debt.Most important debt cancellations.
- Second Chance Law: this law allows deferring debts or their partial / total elimination.
- Home mortgage: the buyer assumes the debt or pays the difference at the time of purchase.
- A loan from a company with the bank, which is the most common debt.
- Request from the entity with which you have the mortgage the debt certificate with the corresponding amount of the remaining debt, or otherwise, if there is no outstanding debt, request the zero balance debt certificate. This certificate request is charged by some entities for issuing it.
- Carry out the corresponding procedures for the mortgage cancellation. This involves notary, management, and registration fees among others that must be informed in advance.
- Proceed to its registration in the property registry so that it is recorded as settled that mortgage debt on the corresponding property.
- Sale of property: the buyer will want the property they buy to be free of encumbrances and therefore the certificate is requested, so that it is canceled at the same time as the signing of the sale and purchase. It must be stated as such in the contract.
- Refinancing of mortgage: to refinance the current mortgage loan, the mortgage must be canceled first and settled to be able to register the new one in the Property Registry.