Case Study – Paid off Your Spanish Mortgage?
A question recently received:-
“During our visit to Spain last year we discussed with our bank collecting the deeds of our property as we have now paid off the mortgage. We were told we had to make an appointment with someone from the bank to accompany us to the Notary to complete this process and have now been advised by the bank that we also need a solicitor to prepare the paperwork? We are not sure what paperwork required to obtain our deeds? We wish to know what is required to tie this up with the Bank. We currently live in the UK but visit the property a couple of times a year and hope to have everything settled on our next visit”
So how did we respond? Well, we advised the client that the information they had been given by the bank was correct. Once someone has fully paid off their mortgage their debt with the bank is extinguished. However, the entry of the mortgage at the Land Registry description of the property is not erased automatically. There is a process to do it exactly as the customers were informed.
Firstly their solicitor has to contact both the Notary and the bank to organise the appointment for the bank representative to attend the Notary and sign the mortgage cancellation Deeds. Their solicitor will later collect these Deeds and take them to the Land Registry office. This document will be sufficient for the Land Registry to remove the mortgage entry from the property.
This process has a cost as the Notary will invoice for the preparation of the mortgage cancellation Deeds, also the Land Registry for erasing the debt. The Bank also charges a small fee to cancel the mortgage. And also there are the fees of the solicitor. We charge 175€ plus v.a.t. for the whole process. As we cannot know how much will be the Notary and Land Registry bills in advance, we usually ask for a provision of funds to cover for Notary, Land Registry and our fees. This amount is always enough and there is something left to be refunded to the clients afterwards.
There is no need for the clients to be present at any stage of the process as they do not have to attend the Notary, only the bank.
We are very happy to help any clients who have paid off their mortgage, but need to have it removed from the Land Registry.