The lender will only lend you money if he is sure to recover it with interest and according to the established schedule. In the case of mortgage credit, he will ask you to pledge the property you buy, build or renovate. This is called the mortgage.
Are you unable to repay your loan? Your lender may , within the framework of a well-defined procedure, seize and put the property up for sale and recover, from the proceeds of the sale, the amounts which are still due to him but also any penalties.
The mortgage on your home is registered in the register of a state-run body, the Legal Security office, for a period of 30 years . Registration is for the amount your lender wants or accepts as collateral.
What property can you mortgage?
You can put several mortgages on the same property. The first creditor to register their mortgage receives “first rank”. The second receives the second rank and so on. Each new mortgage registration receives a new rank.
What is a "first row" listing?
The lender will usually ask you for a “first rank” mortgage. This first rank corresponds to the place of your bank among the creditors who could claim money from you following the sale of your property. This is a way to ensure that he will be the first to be reimbursed in the event of a forced sale. A creditor registered in second rank will only be able to recover his claim after the first creditor has been served. The first rank therefore offers more security to the lender.
For what amount will the mortgage be taken?
Your lender will not take into consideration the price at which you bought your property. He will take a mortgage for the amount of the credit , increased by what are called accessories. These accessories generally amount to 10% of the amount of capital borrowed. These allow the lender to cover the costs that would be incurred such as your home insurance, foreclosure costs, etc. following non-payment of the mortgage loan.
