It is the notarial document by means of which and through its inscription in the Property Registry, it will be possible to eliminate from our property the burden that encumbers it in the form of mortgage, so that once the payment of our mortgage loan has been finalized, through this procedure we will be able to leave our house completely free of encumbrances.
The following calculator offers consumers the possibility of knowing in advance with great accuracy the costs of formalizing the cancellation of their mortgage. This calculator has parameterized both the notary and registry fees, as well as the autonomic regulations in relation to the Stamp Duty and our management fees (in case of entrusting the whole process to our notary's office).
Undoubtedly, the payment of the last installment of our mortgage loan is a milestone in most people's lives, since it means that we have finished paying for our home and that we no longer owe any amount to our Bank or Savings Bank for this concept.
However, beyond the complete payment of the debt, the interested party must know that in the Property Registry the mortgage guarantee remains registered, so that once the payment of our mortgage loan has been completed, in order to leave our property completely free of charges in the Property Registry, it will be necessary to cancel our mortgage, since with this, as indicated, we will be able to eliminate any reference to this loan and its corresponding guarantee already extinguished.
This will allow us, without any doubt, to manage our property much more adequately, because if we want to sell it in the future, the cancellation of the mortgage will be a necessary requirement for the buyer to accept the operation. Likewise, if we plan to donate our property to our children or leave it to them as an inheritance, if the mortgage that we requested at the time is already cancelled, we will save our loved ones this procedure and the relevant inconvenience. Finally, it can also happen that, if in the future we need a new credit operation, and this one must be guaranteed with a mortgage on our house, if we have already made the registry cancellation of the previous guarantee we will not have problems, whereas if this one persists in the Registry of the Property, it is very possible that the financial organization will deny us the operation on having stated that a previous debt exists of which that house responds, although the same one is already paid, since as it has been indicated, registry still continues recording that old mortgage.
For all these reasons, the most reasonable and convenient thing to do, once we have finished paying our mortgage loan, is to cancel the registration of the mortgage.
First of all, the interested party must know that it is true that there is no legal obligation to cancel our mortgage through a mortgage cancellation deed, since if we have completed the payment of our loan, the financial entity can no longer claim anything for it, nor, if applicable, attack the guarantee of that extinguished loan, that is, our right of ownership of the mortgaged property.
However, a diligent management of our patrimony leads us to recommend that, once we have finished paying our mortgage loan, the most advisable thing to do is to proceed with the cancellation of the mortgage registration, because otherwise, in the future this circumstance can generate problems for us.
So, for example, if we want to sell our house, the buyer will demand that the previous mortgage is cancelled in the registry, since nobody will buy our house if the Property Registry shows that it is encumbered by a mortgage. Likewise, if we plan to leave our house in inheritance to our children, or to donate it to them in life, if in the house there is still the mortgage, our loved ones will have to carry out an additional cumbersome procedure that we can save them.
In addition, if in the future we needed money again and we requested a new loan with mortgage guarantee, the bank that was going to grant it to us, if it identifies a previous mortgage that encumbers the property would not agree to carry out the operation, since it would consider that this property is already mortgaged in guarantee of a previous debt.
Finally, it must be taken into account that with the existing scenario of bank mergers, if we do not manage the registration cancellation of our mortgage when we have just paid our loan, it may happen that, after 10 or 15 years, it will be very difficult for our financial institution to provide us with the certificate of zero balance or to manage the granting of the mortgage cancellation deed, since after so much time has passed it may happen that there are no longer any computer records of the operation, so that the current representatives of the bank refuse to certify the payment of a loan of which they have no record, a situation that unfortunately happens very often.
For all of the above, it is again recommended that, once we have finished paying our mortgage loan, the most reasonable and diligent thing to do is to manage the cancellation of the mortgage in question.
In order to cancel our mortgage, it will be necessary to carry out a series of procedures, which are detailed as follows
The Notaries, for their work, when authorizing deeds, generate fees, called Tariffs, which are regulated and priced by a series of public regulations, so that each Notary cannot charge the price he considers, but can only charge that amount that is prefixed by a rule. Thus, with regard to mortgage cancellations, these are invoiced as what is called "documents of amount", so that depending on the amount of the capital guaranteed by the mortgage, that is to say, the money that we request to the bank at the time, the cost of the deed will vary.
To know the specific cost of the deed, as well as the registration of the deed in the Land Registry, we provide you in the previous step of the web a smart calculator to calculate the cost for your specific case.
In order to carry out the cancellation of the registration of the mortgage, effectively each individual can manage the process, however, this can imply a high investment of time and effort, since we will have to go several times to the Notary, to the Land Registry and to the corresponding Settlement Office of our Autonomous Public Treasury.
To avoid all these procedures, if you wish, you can ask the Notary to take care of all this, in exchange for a fee agreed between the parties. Thus, for a modest price, it is possible to obtain the cancellation of our mortgage without the need to carry out cumbersome administrative procedures.
Indeed, in addition to the cancellation of the mortgage through a deed of cancellation, it is possible to cancel a mortgage registered in the Land Registry through the so-called institution of the statute of limitations, that is, by the passage of a long period of time, since the mortgage loan should already be fully paid, without the creditor financial institution having exercised the mortgage action, that is, a judicial process that aims to achieve the forced sale of our property to settle an unpaid debt of our loan.
Thus, if this long period of time elapses since the mortgage should have been paid without the Bank or Savings Bank having gone to a Judge to claim the foreclosure of the guarantee, the law considers that the mortgagee no longer has the right to judicially claim this foreclosure, thus allowing that with a simple private request with a notarized signature the cancellation of the mortgage can be obtained.
As regards the specific term, in accordance with the current regulations, in the scope of the state regulations, if 20 years have elapsed since the debt was to be extinguished (i.e., counting from the date of payment of the last installment) without the Bank or Savings Bank having resorted to this judicial foreclosure proceeding (which, if applicable, would be recorded in the Property Registry by means of a preventive annotation) it will be possible to obtain the cancellation of the mortgage without the need to grant the mortgage cancellation deed.
However, it should be noted that in addition to these 20 years, in accordance with the regulations in force, it will be necessary for another additional year to elapse without there being a record in the Land Registry of the renewal of the obligation or novation of the mortgage or that the foreclosure of the mortgage has not been initiated.
Therefore, in reality, the deadline for requesting the cancellation of the mortgage due to prescription is established, in practice, in 21 years from the date on which the payment of the last installment of the debt must be made.
In any case, it is considered inadvisable to opt for this route, because in such a long period of time many unexpected circumstances may occur that determine the need to sell the property or mortgage it again, so that if there is still the previous burden, this will be much more difficult, so we will be harmed by this reality.
A certificate of zero balance or debt is a document issued by a representative of our financial institution certifying that the mortgage loan that was requested at the time, is already fully paid and that, therefore, there is no debt with the bank.
This will be the document to be delivered to the Notary so that he/she can sign the mortgage cancellation deed with a representative of our entity.
Yes, the mortgagor and owner of the property is the only one entitled to request the zero balance certificate from his bank, so that neither the Notary nor an agency can carry out this procedure.
As the debtor and owner of the property is the interested party in cancelling the mortgage, since, undoubtedly, by releasing his property from the burden he obtains a benefit, he should be the one to bear the costs of the mortgage cancellation deed and its corresponding registration in the Land Registry.
In accordance with current regulations and the Codes of Good Banking Practices of the banking regulator, financial institutions may not charge individuals for issuing the zero balance certificate, nor for the fact that one of their attorneys-in-fact must travel to the chosen notary's office to sign the mortgage cancellation deed.
However, if we entrust to the agency of our Bank or Savings Bank that they are the ones that manage the inscription of the deed in the Registry of the Property, in such case it will be correct that we should pay the price that is agreed between the parts.
The obligation to pay a commission to our bank for the fact of paying before the initially established term the existing debt will depend on what the parties had agreed when the mortgage was constituted, so that if at the time a commission was agreed in favor of the bank to compensate it for the damages that this would generate, effectively the same one will have to be paid.
However, the interested party must be clear that the amount of this commission cannot be any amount, but that there are rules that determine the maximum amount of the same. The specific rule applicable to each mortgage will depend on the time at which it was signed, as these regulations have varied over time.
In the case of recent mortgages, to which Law 5/2019 of March 15, 2009, regulating real estate credit contracts is already applicable, the commission that the bank may charge us will be as follows:
1) For variable interest rate loans, an early repayment fee may be established contractually in one of the following two ways (which shall be mutually exclusive):
2) For fixed interest rate loans, an early repayment fee may be contractually established with the following limits:
If the bank has billed you for undue items, such as, for example, obtaining a zero balance certificate, you can file a claim.
First of all, the claim must be submitted to the bank's customer service department. If after a reasonable period of time you do not receive a response (maximum 2 months), or if the response is not satisfactory, you can go to the Bank of Spain's claims service.
Such claim may be submitted either electronically or in writing, directly in person at the General Registry of the Bank of Spain (in Madrid) or by mail.
Not at all, since the notary who will be in charge of drawing up your mortgage cancellation deed can be entirely of your choice. The bank cannot impose you to go to any specific notary office.
In this regard, it should be noted that on many occasions banks centralize cancellations in specific notary offices, the main reason being that it is a notarial document that does not require the signature of the debtor, but only of the bank's representative. For this reason, and for a more efficient system of time from the bank's point of view, there is a tendency to centralize the signing of this type of document in specific notary's offices.
No, it is not necessary for you to be present at the signing. In the deed of cancellation only the signature of the bank's representative and the Notary is necessary.
As to whether it is necessary for you to contact the attorney-in-fact of your entity, the answer is no, so you do not have to worry about anything, because it will be the Notary who will contact the attorney-in-fact and make an appointment with him for the signature.
If we want to know which is the registry situation of our property, that is to say, to know which concrete data of our property are registered in the Registry of the Property (as for example its size, location or owners), as well as the charges and encumbrances that weigh on it, simply with requesting what is called a simple registry note we will have access to all this.
To obtain this simple registry note, we will have to go to the Land Registry where our property is registered and request it, after which it will be provided to us in a very short period of time (sometimes the same day, or at most, four days), upon payment of its cost, which is not at all high (it usually has an approximate cost of a few euros).
Likewise, it is necessary to take into account that at present this simple registry note can be requested telematically through the web page of the Association of Registrars.
In any case, keep in mind that it is not obligatory for you to carry out this procedure, since if you do not provide the nota simple registral, it will be the Notary Public that you choose to grant your mortgage cancellation deed who will be in charge of requesting it.
In relation to the global term that will be needed to obtain the cancellation of the registration of our mortgage, it is not possible to determine it with precision, since it can depend on many factors, mainly the one related to the time that the representative of your bank takes to go to the notary office for the signature of the cancellation deed.
Nevertheless, once the signature of the same one is obtained, the procedure will already be accelerated a lot, because from the date of the signature the maximum term of one month is available to present the self-assessment of the Tax of Documented Legal Acts (procedure that if it entrusts the management to its Notary will make the same day of the signature) and, from the moment the deed is presented at the Land Registry, 15 working days for its registration or, if applicable, negative qualification if the deed contains any error or there is any exceptional circumstance that prevents its registration at that moment.
In any case, from the accumulated experience it can be affirmed that the term of one month is the reasonable and usual one to obtain the cancellation of the registration of our mortgage.
If throughout the life of our mortgage loan we have experienced a moment of serious economic difficulty, to such an extent that for a certain period of time we were unable to pay the corresponding installments, which caused the financial entity to initiate a judicial foreclosure proceeding, but subsequently this situation was overcome, so that the outstanding debt was paid off, it is possible that there is an added difficulty.
This is so because if the Land Registry records that the foreclosure proceeding was initiated (in what is called a marginal note) but does not properly record that it was filed due to the creditor's withdrawal, when the debtor manages to reestablish the payment of the loan, it will be necessary to take a previous step, that is, to request from the corresponding Court a judicial order to cancel the marginal note, to subsequently present it at the Land Registry, and thus have said note cancelled and subsequently register the deed of cancellation of the mortgage.
Once this procedure has been completed, the mortgage can be cancelled through the registration of the mortgage cancellation deed, as in any other case.
A document issued by our financial institution certifying that the loan guaranteed by the mortgage has been paid in full, so that the Bank or Savings Bank consents to the cancellation of the guarantee, since the principal obligation has already been extinguished.
Document issued by the Land Registry in which the registry data of the property appear: location, description, etc.; as well as its owners and the mortgage to be cancelled. If it is not available, it will be the Notary's office itself who will request it directly from the Land Registry. Therefore, this second document is not essential to be provided by the client.
If the interested party in the cancellation of the registration does not wish to carry out by himself the procedures of liquidation of the tax and registration of the deed of cancellation of the mortgage (since this will imply to dedicate several days to the management, as for example to take the deed to the Registry, to request its inscription, to go again to withdraw the registered deed, etc.) he can entrust to his Notary that he carries out these managements, who will carry out them in his name in exchange for some honoraria. In this case, the interested party must sign a document of authorization and provision of funds, in which, in the first place, the Notary is authorized to carry out such management in the Land Registry on his behalf, and in which it is also recorded the provision of funds paid by the client to the Notary, with which the latter will collect his fees and pay the corresponding Tariff to the Land Registrar.
