Extinction on Demand
By non-payment of the mortgage debt the mortgage creditor can demand the extinction of the mortgage from the land register. For the extinction of mortgages which were created for the benefit of legal entities such as public-law institutions, banks and insurance institutions a written of these institutions is sufficient.
Extinction Based on a Court Decision
If the mortgage creditor does not effect the extinction of the mortgage despite the payment by the debtor, the debtor can obtain the extinction of the mortgage in the land register via court decision. For the extinction, an effective decision has to be submitted.
Realization of Real Estate
In case of non-payment of the mortgage debt, the creditor can apply for an execution procedure by submitting sufficient records to the Court which is competent for the execution of civil judgments. The Court informs the debtor and demands the payment of the mortgage debt in a specified period of time. If the debtor does not settle his debts in the specified period, the Court for execution of civil judgments fixes a date for a public auction where the encumbered real estate will be sold. The parties are not authorized to agree upon another kind of sale.
In the meantime it is noted in the land register that the property is going to be put up for auction. At the same time, the priority notice in the land register effects restrictions concerning transfer and assignment of the property and the purchase of rights in rem. The same property can be burdened with several liens for different claims. Their relationship towards each other is defined by their rank. In case of the realization of the mortgage the “priority” of the mortgage is the most important point because the mortgage has the meaning of a guarantee according to its rank in the land register. Thereby a lien of prior rank has priority over a lien of lower rank. This means that the realization of the mortgage debts happens according to their rank.
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