Deleting a land charge: What to do after repaying the loan

Westphalian Chamber of Notaries. Once a real estate loan has been repaid in full, the bank issues a deletion authorization. This step marks the successful repayment of the loan, but does not mean the complete end of the business relationship between the credit institution and the property owner. One important aspect often goes unnoticed: the land charge entered in the land register continues to exist.

Assign land charge?

Owners often deliberately fail to submit the necessary application for deletion. Contrary to popular advice, however, this is not advisable. Although the property owner saves money initially, the formal existence of the land charge However, its use is limited. The practice of transferring the mortgage to another bank for refinancing, which was quite common in the past, is now often no longer accepted. However, if the previous bank is to secure a new loan, there is no objection to reusing the land charge.

What prospective buyers when purchasing a plot of land You should definitely take note of this, read here.

Why deletion is advisable

If the deletion authorization cannot be found when the property is sold at a later date, it is still possible to notarize the purchase agreement. However, this will cause a considerable delay in the transaction. This is because the land register A registered bank will usually issue a new deletion authorization without any red tape, but not necessarily quickly. The delay will then also affect the purchase price payment. If the bank no longer exists, the Kreditanstalt für Wiederaufbau (KfW) is responsible and will be contacted by the notary. Please note: The right to deletion may become time-barred.

To avoid any risks, property owners should consult a notary with the deletion authorization. The notary will arrange for the land charge to be deleted at the land registry office.

If you would like advice on this topic from a notary in advance, you can find it on the Internet at https://notar.de/ the right contact person. You can also visit the online consumer portal of the Chamber of Notaries at https://ratgeber-notar.de/.