When is money disbursed when concluding a mortgage deed?
Each credit institution has its own requirements and can disburse the money at two different times:
a) when the mortgage deed is concluded;
b) after consolidation of the mortgage.
When the purchaser of a property enters into a loan agreement, the bank requires the establishment of a first lien on the property to guarantee the sums disbursed.
A mortgage is a security right in rem that gives the holder the power to expropriate the debtor's property pledged as security for his claim.
The mortgage lien relates exclusively to assets tied to a specific claim: the creditor may not extend the guarantee to claims other than those specifically indicated.
The mortgage is indivisible and subsists in its entirety over all the attached assets, over each of them and over every part thereof.
The lien granted at the same time as the mortgage deed is voluntary, and is indissolubly linked to it: being an accessory guarantee, the lien ends with the extinction of the guaranteed obligation.
The lien must be granted by public deed or private deed, on penalty of nullity, and cannot be granted by will.
In order for the lien to take effect, it is not sufficient for consent to be given by signing the mortgage deed.
Certain formalities must be observed.
The lien must be entered in the public land registers (Conservatoria) of the place where the property is located.
The publicity is constitutive in nature: without this requirement, the lien cannot be considered legally existing.
Pursuant to article 2839 of the Civil Code, in order to proceed with registration the creditor must present the constitutive title (mortgage contract) and a note, signed by the applicant in duplicate, containing the following informations:
1) the surname, first name, place and date of birth and the tax code number of the creditor, the debtor and any third-party lien; the name or company name, registered office and tax code number of legal persons, companies and unrecognised associations, indicating, for the latter and for simple companies, also the names of the persons representing them according to the deed of incorporation;
2) the creditor's elected domicile in the district of the court where the land register office is situated;
3) the title, its date and the name of the public official who has received or authenticated it;
4) the amount of the sum in respect of which the registration is made;
5) the interest and annuities that the claim generates;
6) the time of the due date;
7) the nature and situation of the encumbered property, with specific indications suitable for identifying the property (land registry data; municipality of location, etc.).
The conservator returns one of the originals of the note, certifying the date and the registration number at the bottom of it.
An entry submitted to an incompetent office and one that does not contain the above information (except for number 5) is void.
With the formality of the registration, the lien comes into legal existence.
The registration is effective for 20 years; after 20 years, it must be renewed, otherwise the lien is extinguished.
Registration triggers the lien, but it is necessary to wait about 15 days after registration in the land register for the lien to be consolidated.
Once this period of time has elapsed since registration, no other liens that may have been registered against the purchaser can be enforced against the bank.
Basically, lien consolidation entails a deferred payment of the mortgage with respect to the deed.
Payment can be made in various forms:
a) deposit of a bank draft with the notary; once the consolidation of the lien has been established, the cheque will be handed over to the seller;
b) the bank issues an irrevocable mandate for a bank transfer in favour of the seller; once the consolidation of the lien has been ascertained, the seller will receive the transfer.