Mortgage and Mortgage Registration: Procedure and Types

Everything you need to know about mortgages and their registration procedure.

The term mortgage indicates one of the real rights of guarantee provided for by our Civil Law Code. It is a ius in re alien – that is, a right encumbering assets owned by others and intended to coexist with the owner's right – by virtue of which the owner of the same is granted the power to be assigned, in the event of failure to fulfill the obligation contracted by the debtor, the proceeds from the alienation of the asset on which the guarantee (or mortgage) was constituted, with preference over other creditors.

Constituent elements of the mortgage.

The mortgage is characterized by the following elements:

• Speciality: that is, the mortgage can be constituted only on specific assets, usually belonging to the categories of real estate, registered movable assets, state withholdings or real estate rights;
• Indivisibility: as established from art. 2809 of the Civil Code, the mortgage, in fact, encumbers entirely each of the assets on which it is constituted, in relation to a specific credit claimed by the creditor, with the consequence that the latter can be entirely satisfied even through the expropriation of just one of the mortgaged assets of the debtor.

The powers of the mortgagee.

The creation of a mortgage in favour of a creditor determines the acquisition by the latter of the following powers:

• The right of distraction: by virtue of which the mortgage creditor can request the expropriation of the property on which the guarantee has been constituted in the event that the debtor does not fulfill the contracted obligation. This right can also be exercised in the event that the property subject to the mortgage has become the property of third parties (so-called right of sequela);
• The right of pre-emption: understood as the right of the creditor to be satisfied directly – with preference over other creditors – from the proceeds of the sale of the goods subject to guarantee, in the event of default by the debtor.

The different types of mortgage.

Depending on the title with which the mortgage is established, three types of mortgages can be distinguished: legal, judicial and voluntary.

The legal mortgage finds its foundation in a specific provision of the law that attributes to certain categories of creditors the right to obtain the registration of the mortgage unilaterally, that is, without (or even against) the consent of the debtor. The legal mortgage belongs to the seller in relation to the alienated properties, as a guarantee of the obligations existing on the part of the purchaser as a consequence of the act of alienation: to the co-heirs, partners and other co-owners, in relation to the properties individually attributed to them, as a guarantee of the payment of the adjustments due by the assignee by virtue of the act of division.

The judicial mortgage it is established in the event that the right to request the registration of the mortgage derives from a sentence - or other judicial provision - with which the debtor has been condemned to the payment of a sum of money, to the execution of another obligation, or, to the compensation of damages to be liquidated subsequently, in favor of the creditor.

The voluntary mortgage, lastly, it can be registered by virtue of a contract or a simple unilateral declaration of intent by the grantor, to be made, under penalty of invalidity, in written form, with the indication of all the elements necessary to identify the property on which the guarantee is constituted.

Registration of the mortgage.

It is necessary to specify that the constituent elements just described (legal provision, judicial provision, agreement between the parties or unilateral act) simply attribute to the creditor the right to register the mortgage. In order for the mortgage to be properly effective, with consequent acquisition by the mortgage creditor of the rights previously identified and the possibility for the same to oppose the acquired real right to third parties, it is necessary, in fact, that the registration is actually put into effect.

But where is the mortgage registration requested and what documents are needed?

The answer is provided directly by the legislator where it specifies that the registration of the mortgage must be carried out at the Revenue Agency Office of the place where the mortgaged property is located or - in the event that properties located in different Municipalities must be considered - at each of the Real Estate Registers of the property districts.

The creditor holding the right of registration must present the titles constituting his right to the offices in question: thus, if the title for the registration of the mortgage results from a public deed or a judgment, the creditor must deposit a copy of the aforementioned documents; if the right in question derives from a private deed, the interested party must deposit the original of the deed in question or a copy authenticated or certified by court.

In the case of a legal mortgage, intended, as previously underlined, for specific categories of creditors identified by the legislator, the registration must be carried out ex officio by the person in charge of the competent Office, following presentation by the applicant of the deed of alienation or division.

Once the registration has been carried out, the mortgage creditor is assigned an order number which determines the so-called "mortgage grade"

The latter is of fundamental importance for the purposes of defining the "order of preference of creditors" who have constituted mortgages on the same property. Indeed, in the event that a property burdened by two mortgages - the first with a value of 100 and the second with the same value but with a subsequent mortgage degree, because it was registered later in the public real estate register - is sold for an amount sufficient to satisfy only one of them, the creditor holding the previous mortgage degree will be satisfied with preference. In the event that two creditors request registration against the same debtor at the same time and on the same property, the registrations are carried out under the same number and the aforementioned compete with each other in proportion to the amount of their respective credits.

On our website you can quickly obtain a mortgage registration: you provide us with the constitutive title and we will carry out the entire registration procedure for you! For more information on costs and times of the service, read here.

To find out if there is a mortgage registered on a property, just do a Mortgage Certificate . In relation to registered movable assets, to find out whether there is a mortgage or other encumbrances, you can request a pra license plate search.

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