Mortgage loan and real estate seizure: what are the differences and how do they influence the purchase of a house? Let’s examine them together.
Buying a house It is frequently a crucial moment in an individual’s life. However, among the various issues to consider, some may cause concern or confusion. Two terms that often inspire fear are “Mortgage mortgage” and “real estate seizure”: although sometimes confused, they represent two very different legal conceptswith distinct implications for both property owners and lenders.
So let’s analyze what they are Differences between mortgage loan and real estate seizuretheir consequences and how to protect yourself when you decide to buy a property.
What does mortgage loan mean and what the risks are
The mortgage loan It is a real guarantee right that the creditor can obtain on a propertyrecording it at public real estate registers. This means that if the debtor does not pay the debt, the creditor has the right to request the expropriation of the property And the collection deriving from the sale will be used to cover the debt, having precedence over other creditors.
Il Italian law recognizes three types of mortgage loansor the legal, judicial and voluntary one:
- legal mortgage loan: is formed automatically in certain conditions established by law, such as the sale of a property, to guarantee full payment of the price;
- judicial mortgage loan: derives from a judicial decision that obliges the debtor to compensate the creditor;
- voluntary mortgage loan: It originates from an agreement between the parties, as in the case of a mortgage granted by a bank.
An aspect to consider in the purchase of a property is the possibility that it is already encumbered by a mortgage loan. It is essential, during the sale transaction, verify the legal situation of the property. If a non -extinct mortgage persists on it, the buyer must be aware that the mortgage “follows” the property: Even if the property passes to a new owner, the debt and mortgage security remain active. If payment is not made, the new owner may be forced to deal with a expropriation situation.
What is real estate seizure and when is it triggered?
Real estate seizure, on the contrary, is one executive measure which represents the first concrete step towards Forced sale of property to satisfy an unpaid debt. Unlike the mortgage loan, which is a precautionary and preventive measure, the seizure is activated when the debtor is already in default.
It is therefore one most advanced stage of the executive process. In practice, the seizure “blocks” the debtor’s assetsbinding him to pay the debt not only of the creditor who started the procedure, but also of any other creditors who may intervene in the process.
During the seizure, the debtor can continue to live in the property, but is subject to which oblige him not to damage or steal the goods, pending the sale. If the property is already mortgaged, it is not necessary to proceed with a new seizure, since the effects of the seizure are already implicit in the registration of the mortgage loan.
The differences between mortgage loan and seizure
To the main ones difference between mortgage loan and seizure resides in theirs nature and timing. The mortgage loanas mentioned, is a guarantee that can be voluntary or imposed by the judge, and it is one preventive measure which warns the debtor of the future risk of expropriation. The seizurehowever, is one executive measure which occurs when the risk is no longer theoretical, but concrete. In simple words, mortgage loan is a warning signWhile seizure is the final step that begins the expropriation and sale of the property.
In practical terms, a mortgage-encumbered property can still be purchased, but it is important that the buyer is aware of the existence of the mortgage and the associated risks. In the event of seizure, however, the purchase of the property becomes much more complex and risky, given that the asset is already the subject of an enforcement process which involves its forced sale.
How to avoid problems when buying a property
Before buy a houseit is always recommendable Check carefully whether the property is subject to mortgage or seizure. The presence of a mortgage does not preclude the sale, but it is necessary that the seller clearly informs the buyer and that there are clear agreements for its repayment.
Il notaryin this context, plays a crucial role in verify the legal status of the property and in ensuring that there are no undisclosed situations that could compromise the purchase.
A property already under seizure, however, requires more attention. In this case, we recommend request specialized legal advicegiven that you could face complications related to other creditors and judicial procedures already in place.
