Mortgage cancellation
After having repaid the loan secured by a mortgage, it is advisable to proceed with the mortgage cancellation process. But what does it involve and what steps should we consider when carrying it out?
Mortgage Cancellation at the Notary's Office
For the mortgage payment process to be successfully completed and for the mortgage to be satisfactorily discharged, it must be confirmed through the mortgage cancellation deed, a legal document that becomes a fundamental step within the mortgage cancellation registration process.
What is the purpose of the mortgage cancellation deed before a Notary?
The mortgage cancellation deed includes the identification details of the parties involved, the description of the property, the mortgage details, it declares the full payment of the mortgage loan debt and records the release of any claim on the property by the lender.
The signatures of the parties involved, along with that of the Notary and, finally, the registration of the property in the Land Registry officially declares the property free of mortgage charges.
Why cancel a mortgage
It is advisable to resolve the cancellation of the mortgage lien after paying the last instalment to prevent future procedures from being blocked. For example in:
- Subsequent sale of property. The registration cancellation is part of the essential documentation for these transactions.
- Donation procedures or inheritances. The recipients or heirs will have to undertake procedures, resolve the cancellation formalities and bear the expenses incurred.
- Requesting a loan with a mortgage on the property that had a mortgage already paid off. For legal purposes, there will still be a mortgage on the property. Therefore, no financial institution will provide any credit until this is resolved.
- Difficulties in obtaining the zero balance certificate later, especially after bank mergers or acquisitions, loss of computer records or other internal issues within financial institutions.
The role of the Notary for mortgage cancellation
The Notary will verify all relevant documentation to ensure that legal requirements are met, supervise the signatures, and certify the authenticity of the information. They will also provide copies to the parties involved in the process and maintain the notarial records.
At our notary office in Barcelona, we offer a comprehensive service including:
- Advice on the procedures and steps to follow to cancel your mortgage.
- Drafting and granting of the deed.
- Tax settlement (it is an exempt operation, that is, it will not incur taxes, but it must be settled and submitted to the tax authorities).
- Submission of the cancellation at the Land Registry.
Steps to follow to cancel the mortgage
There are 3 cases that lead to mortgage cancellation after paying off the debt to the bank, and each is processed differently. They are:
- Paying the last instalment or after early repayment of the mortgage loan.
- Due to the sale of the mortgaged property.
- Due to expiry, after the passage of time.
Below, we will explain how to cancel a mortgage in each of these situations.
1. Cancel a mortgage for having paid all the instalments or repay the loan early
In this case, follow these steps:
- Request a zero balance certificate from the bank, where the bank certifies that there is no debt, as well as the identification of the property on which the mortgage is secured. In case of repayments, you must first request the outstanding balance from the bank, to pay the exact amount (take into account early cancellation fees).
- Go to your trusted Notary so that they can proceed to draft the cancellation deed.
- Once the deed is done, a bank representative must visit the notary’s office (without the client needing to attend). Likewise, the financial institution to which you have paid your mortgage cannot charge for the processing of the signature nor for the representative’s travel to the notary.
- Settle the AJD tax (Documented Legal Acts). No tax is paid for cancelling a mortgage, but we must settle and submit it to the Tax Office, except in some Autonomous Communities, such as Andalucía, where it is no longer necessary.
- Submit the deed along with the settlement at the competent Property Registry so that the mortgage can be “erased”.
What documents do I need?
- Zero balance certificate: This document issued by the financial institution certifies that the loan in question has been fully paid off. Only the interested party can request it and it is completely free of charge. In the event that you intend to repay the mortgage early, you must make a request to your financial institution regarding the outstanding balance. Please take into account the early mortgage cancellation fees.
From the notary's office, once it has been verified that the zero balance certificate is correct, we will obtain the following documents:
- Updated simple registry note with the registry data of the property, issued by the Land Registry. You can request it yourself or leave it in the hands of the notary.
- Authorisation and provision of funds. Do you want to entrust the task to your Notary? You must sign the authorisation document and the provision of funds, in accordance with the agreed fees.
Stamp Duty model 600 and the Mortgage Registry Cancellation
Subsequently, you must:
- Manage the settlement of the Tax on Documented Legal Acts (AJD), mandatory but exempt from payment. Submit the form known as model 600 according to the regulations of the autonomous community in which you are located.
- Submit the deed along with the zero balance certificate and the AJD tax settlement to the Property Registry for the registration cancellation. Additionally, you must pay the registration costs for the inscription of your mortgage cancellation in the Property Registry, by paying the Registrar's invoice. After some time, it is recommended to request a simple note to verify that the cancellation has indeed taken place.
At JLA Notarios, we offer a comprehensive service for your convenience, and we can declare the cancellation of your mortgage to the Tax Authorities on your behalf and also manage the registration of the deed in the Property Registry.
2. Cancel the mortgage due to the sale of a property
If you wish to sell the property that you have mortgaged and the buyer does not wish to subrogate the mortgage, you must deliver the property being sold free of encumbrances by paying off the mortgage debt with part of the sale money.
In this case, a certificate must be requested from the bank showing the outstanding mortgage balance as of the date on which the deed of sale is to be signed.
The buyer must make two payments: one to the bank for the outstanding balance and the remainder to pay the seller. Once this payment has been made, the bank will issue a zero balance certificate and the cancellation will proceed following the same steps previously indicated.
Who pays for the mortgage cancellation deed in this case?
When a property with a mortgage is sold, the buyer's bank management, if they purchase with a mortgage, will be responsible for managing the cancellation of their mortgage and will have to pay the amount they establish.
If the buyer does not purchase with a mortgage, they will have the freedom to manage the cancellation of the mortgage with whoever they wish. In this case, we advise that the buyer themselves manage the cancellation, keeping part of the purchase price (between €800 and €1,500, depending on the case) to pay the cancellation costs, as these correspond to the seller, unless otherwise agreed.
3. Cancel mortgage due to expiration
To cancel a mortgage due to expiry, twenty-one years must pass from the date of the last mortgage payment. If you have a lot of patience, you can do it this way, although it is not the most advisable, as it may cause problems for your heirs.
Cancel Mortgage Online
With the approval of Law 11/2023, of 8 May, from 9 November 2023 it is possible to cancel a mortgage online in a 100% electronic way. With our online notary service, you will also have permanent access to the electronic copies authorised by the Notary.
Notary fees for mortgage cancellation and Notary price for mortgage cancellation deed
The Notary's price for a mortgage cancellation deed is established based on the Notarial Fee Schedule (RD 1426/1989), the registration fee, the legal acts tax, and the management or processing expenses condition the final cost.
Factors such as the number of copies, pages, additions or changes intervene in the price… therefore, the final amount cannot be calculated until its specific content is known. In the case of mortgage cancellations, the amount increases if more than one loan is cancelled or if there is more than one property in the mortgage being released.
And, although we invite you to contact us directly for a quote (whether through our contact form, Whatsapp, email at bcn@jlanotarios.com or by calling us at 93 159 17 62), we can tell you in advance that the price of a mortgage cancellation deed ranges between €140 AND €280, including VAT.
This indicative price is calculated for a cancellation once the entire mortgage has been paid, with a document of usual content (30 pages) and with the issuance of one authorised copy and one simple copy.
Remember that you will have to pay the fees of the Property Registry and the services of the professional who declares the cancellation of your mortgage to the Tax Office by filling in tax form 600.
More questions related to mortgage cancellation
When the payment of a mortgage is completed, we must manage the registration cancellation of the mortgage at the Land Registry because otherwise, the mortgage guarantee would remain registered and it would not appear that our property is free of encumbrances.
Therefore, cancelling the mortgage on a property allows the removal of references to the loan in the registry and will facilitate better management of a future sale of the property. Indeed, if you want to sell a property, the buyer will require that the house be delivered free of encumbrances, and, therefore, that the mortgage release and registration cancellation have been processed.
It will also be beneficial to have the registration cancellation of a mortgage in case of processing lifetime donations of that property, handling an inheritance in which that property is inherited, or when carrying out new financing operations with a mortgage.
Managing the registration cancellation of a mortgage would also demonstrate that we are solvent and, in the case of needing another loan, its granting would be faster.
The process usually takes about 15 days to complete all the notarial work and approximately one more month to have the deed registered in the Registry. Therefore, the usual total timeframe for the cancellation of a mortgage registration is between one and a half and two months.
These timeframes depend on the bank and its internal process, as the issuance of the corresponding certificate and the availability of the bank's authorised representatives to sign the cancellation will depend on them.
In addition to the notary fees for mortgage cancellation, there are other costs to obtain the registration cancellation of a mortgage. They are as follows:
- Mortgage registration cancellation fees: in a mortgage cancellation, you must pay the mortgage cancellation fees to the Property Registry. The price for cancelling a mortgage in the Registry is set by law and the Registry will always provide you with an invoice for the mortgage cancellation costs.
- Costs for managing the taxes related to the mortgage cancellation and verifying the proper registration in the Registry: since mortgage cancellations are subject to but exempt from the Tax on Documented Legal Acts (AJD), no taxes need to be paid but the AJD form 600 must be declared to the Tax Office. After making the declaration at the Tax Office, the cancellation deed must be submitted to the Property Registry along with the tax form to complete the cancellation process in the Registry. You can carry out these procedures yourself or hire the services of a professional. If you hire a professional for these procedures, you will have to pay their fees.
To cancel your mortgage at the notary, you need to have fully paid off your mortgage and have a zero balance certificate issued by your bank stating that the mortgage is fully paid. From the notaries, we can take care of all the procedures to cancel your mortgage if you provide us with the zero balance certificate that proves you have paid off your entire mortgage, without the need for you to attend the notary in person if you do not wish to.
Cancelling a mortgage serves to ensure that the property which had the mortgage becomes free of encumbrances in the Land Registry. Therefore, cancelling the mortgage allows the property to be sold free of encumbrances and prevents future problems for the heirs when they inherit the properties.
The zero balance certificate is the only document you need to provide to your notary to cancel your mortgage, as it certifies that the mortgage is fully paid off. It must be signed with a physical or digital signature by the bank.
You can obtain this zero balance certificate once you have fully paid your mortgage and request the issuance of this certificate from your bank. The request can be made by visiting your bank's branch in person or through online banking. Currently, most financial institutions allow you to obtain the zero balance certificate entirely online.
At this point the law is clear and prohibits banks from charging anything for issuing the zero balance certificate. The bank cannot charge anything for any procedure related to mortgage cancellations. Therefore, according to the law, the client must attend the notary of their choice anywhere in Spain free of charge.
The mortgage cancellation deed is only signed by the representative of the bank to which the mortgage has been fully paid. Therefore, it is not necessary for the client cancelling their mortgage to go to the notary to sign, as they can communicate conveniently with the notary of their choice by phone or email.
As we have explained previously, there is no need to pay taxes when cancelling a mortgage. However, it is necessary to notify the Regional Tax Office of the mortgage cancellation. In most Autonomous Communities, this involves filling out form 600 and submitting it to the Tax Office.
You should know that meeting all tax requirements is an essential condition for your mortgage cancellation deed to be successfully registered in the Property Registry. If compliance with the tax requirements is not proven in the Registry, the Registrar will suspend the registration of your cancellation.
Notary for Mortgage Cancellation in Barcelona
At JLA Notarios, Notary in Barcelona and online Notary, we offer you the best mortgage notarial services and general services. Contact us to be able to obtain a debt-free property and improve your financial and personal life. We guarantee you the best assistance and the protection of your interests in the mortgage cancellation process from a legal perspective and in compliance with the legislation.
By your side in the moments that matter
Inheritance and wills
The moment of granting a will, making a declaration of heirs or formalising an inheritance are very important moments in people's lives.
At JLA Notarios we offer services related to succession law, both to arrange your succession and to distribute an inheritance, guaranteeing the best advice tailored to your particular needs and the study of the tax implications of each case. At no time do we neglect the human factor, even offering home notary services if necessary.
Contracts and property law
Over the course of our lives, we carry out important actions, such as buying a home, declaring a new-build, lifetime gifting to our children or ending partnerships, among many others.
At JLA Notarios we are experts in property and contract law and buying and selling property. We guide our clients, analysing each particular issue and always considering the tax burden of each transaction.
In addition, some of our notarial services can be performed online, so we can assist you from anywhere in Spain. Contact us to declare a new-build or a commonhold ownership structure online.
Mortgage
Taking out a mortgage is one of the biggest moments for anyone. Just think of the fees and interest you may have to pay for much of your life. So it is essential to have a trusted notary to help you understand what you are signing, explaining the tricky legal terms and their future consequences in simple words, to provide transparency and protect our clients.
At JLA Notarios we are aware of the importance of giving complete and understandable information to people about to sign a mortgage, novation or subrogation. We also advise and guide you on your future mortgage cancellation.
Loan agreements and credit facilities
Individuals and companies often need money to fulfil their dreams or projects. This can be obtained by taking out a loan or credit facility with your bank. When you sign, it is essential to understand the details properly to avoid future surprises.
JLA Notarios can be your trusted notary office, giving you accurate advice on loan contracts, providing a very agile and specialised service for processing loan contracts.
Bear in mind that from 9 November 2023, you will be able to sign your loan contracts from anywhere in Spain electronically by videoconference with JLA Notarios, saving you time and money. Do not hesitate to contact us to find out more about the notary office’s services in order to sign a loan contract online or sign a credit facility online.
Companies
Without entrepreneurship there is no future, so it is of vital importance to support our businesspeople and entrepreneurs.
At JLA Notaries we are familiar with companies’ life cycle, which enables us to provide legal assistance for companies in their different stages, whether incorporation, modifications of their articles of association, changes of director, share sales and purchases, capital increases and reductions, dissolution and closure, and everything related to commercial matters.
Powers of attorney
There are moments in life when a person needs to delegate. The law provides a tool for this: powers of attorney. Though a power of attorney, one person allows another person to act on their behalf.
At JLA Notarios we make sure that you understand the significance and risks of delegating or revoking powers of attorney, from a special power of attorney or power of attorney for lawsuits, to general powers of attorney or preventive powers of attorney for cases of incapacity.
We provide an agile service to sign powers of attorney. You can take your copy away immediately, saving you unnecessary trips, and from 9 November 2023 our clients will be able to sign all powers of attorney that are not general or preventive by videoconference through our digital notary office.
Family affairs
A prosperous society is based on the family and its protection. Family Law provides you with the tools to protect your family and its members, so its foundations are solid and its purposes can be achieved.
At JLA Notarios we provide legal advice on marriage or civil partnerships; property aspects of the family through marriage contracts or civil partnership contracts; the moments when the family relationship is ended, in cases such as divorce or separation; and protection of vulnerable people, such as minors or people with modified capacity, through deeds of appointment of guardians or executors or creation of protected assets. We do all of this in a way that makes everyone involved feel equally supported and secure.
Certifications and authentications
It is common knowledge that notaries attest. That important and simple action can guarantee things of vital importance, such as ensuring that the signature on a document is authentic or certifying that a copy of a document matches the original.
At JLA Notarios we will help you to certify a document or notarise a signature in accordance with the law and tailored to your specific needs.
In addition, these notarial procedures can be carried out conveniently through electronic means from 9 November 2023.
Minutes
How many times have you wanted to leave a record of an event, of a statement, of the condition in which an object is found, or notify someone of any matter. To provide a solution to these issues, the Law provides us with notarial records.
At JLA Notarios we adapt to you, reflecting in the record what you require and carrying out the notifications and requests that you demand.
Oath of Nationality
Behind every nationality oath there is a story of overcoming, sacrifice and waiting.
At JLA Notarios we understand what this moment means and offer an empathetic, agile and quick service, advising beyond the oath itself, anticipating the future requirements that the new Spanish citizen will need.
We are your reference Notary to carry out the nationality oath before a Notary in Barcelona.
Apostille of the hague convention
Globalisation enables the free movement of people and documents of all kinds. How can you guarantee that a document has been officially issued? With an apostille of the Hague Convention.
JLA Notarios can obtain an apostille for all documents executed before us so they are valid and recognised abroad. We do this transparently and save you all the bureaucratic procedures involved.
Tax and registry procedures
Tax bureaucracy can cause a lot of headaches.
So JLA Notarios offers its clients the possibility of assessing and paying the many different taxes by the executing deeds and carrying out other procedures before the notary. We can also file them with the Land or Companies Registry so you do not have to concern yourself with it and can spend your time on the things that matter. We support you from start to finish.
Inheritance and wills
The moment of granting a will, making a declaration of heirs or formalising an inheritance are very important moments in people's lives.
At JLA Notarios we offer services related to succession law, both to arrange your succession and to distribute an inheritance, guaranteeing the best advice tailored to your particular needs and the study of the tax implications of each case. At no time do we neglect the human factor, even offering home notary services if necessary.
Contracts and property law
Over the course of our lives, we carry out important actions, such as buying a home, declaring a new-build, lifetime gifting to our children or ending partnerships, among many others.
At JLA Notarios we are experts in property and contract law and buying and selling property. We guide our clients, analysing each particular issue and always considering the tax burden of each transaction.
In addition, some of our notarial services can be performed online, so we can assist you from anywhere in Spain. Contact us to declare a new-build or a commonhold ownership structure online.
Mortgage
Taking out a mortgage is one of the biggest moments for anyone. Just think of the fees and interest you may have to pay for much of your life. So it is essential to have a trusted notary to help you understand what you are signing, explaining the tricky legal terms and their future consequences in simple words, to provide transparency and protect our clients.
At JLA Notarios we are aware of the importance of giving complete and understandable information to people about to sign a mortgage, novation or subrogation. We also advise and guide you on your future mortgage cancellation.
Loan agreements and credit facilities
Individuals and companies often need money to fulfil their dreams or projects. This can be obtained by taking out a loan or credit facility with your bank. When you sign, it is essential to understand the details properly to avoid future surprises.
JLA Notarios can be your trusted notary office, giving you accurate advice on loan contracts, providing a very agile and specialised service for processing loan contracts.
Bear in mind that from 9 November 2023, you will be able to sign your loan contracts from anywhere in Spain electronically by videoconference with JLA Notarios, saving you time and money. Do not hesitate to contact us to find out more about the notary office’s services in order to sign a loan contract online or sign a credit facility online.
Companies
Without entrepreneurship there is no future, so it is of vital importance to support our businesspeople and entrepreneurs.
At JLA Notaries we are familiar with companies’ life cycle, which enables us to provide legal assistance for companies in their different stages, whether incorporation, modifications of their articles of association, changes of director, share sales and purchases, capital increases and reductions, dissolution and closure, and everything related to commercial matters.
Powers of attorney
There are moments in life when a person needs to delegate. The law provides a tool for this: powers of attorney. Though a power of attorney, one person allows another person to act on their behalf.
At JLA Notarios we make sure that you understand the significance and risks of delegating or revoking powers of attorney, from a special power of attorney or power of attorney for lawsuits, to general powers of attorney or preventive powers of attorney for cases of incapacity.
We provide an agile service to sign powers of attorney. You can take your copy away immediately, saving you unnecessary trips, and from 9 November 2023 our clients will be able to sign all powers of attorney that are not general or preventive by videoconference through our digital notary office.
Family affairs
A prosperous society is based on the family and its protection. Family Law provides you with the tools to protect your family and its members, so its foundations are solid and its purposes can be achieved.
At JLA Notarios we provide legal advice on marriage or civil partnerships; property aspects of the family through marriage contracts or civil partnership contracts; the moments when the family relationship is ended, in cases such as divorce or separation; and protection of vulnerable people, such as minors or people with modified capacity, through deeds of appointment of guardians or executors or creation of protected assets. We do all of this in a way that makes everyone involved feel equally supported and secure.
Certifications and authentications
It is common knowledge that notaries attest. That important and simple action can guarantee things of vital importance, such as ensuring that the signature on a document is authentic or certifying that a copy of a document matches the original.
At JLA Notarios we will help you to certify a document or notarise a signature in accordance with the law and tailored to your specific needs.
In addition, these notarial procedures can be carried out conveniently through electronic means from 9 November 2023.
Minutes
How many times have you wanted to leave a record of an event, of a statement, of the condition in which an object is found, or notify someone of any matter. To provide a solution to these issues, the Law provides us with notarial records.
At JLA Notarios we adapt to you, reflecting in the record what you require and carrying out the notifications and requests that you demand.
Oath of Nationality
Behind every nationality oath there is a story of overcoming, sacrifice and waiting.
At JLA Notarios we understand what this moment means and offer an empathetic, agile and quick service, advising beyond the oath itself, anticipating the future requirements that the new Spanish citizen will need.
We are your reference Notary to carry out the nationality oath before a Notary in Barcelona.
Apostille of the hague convention
Globalisation enables the free movement of people and documents of all kinds. How can you guarantee that a document has been officially issued? With an apostille of the Hague Convention.
JLA Notarios can obtain an apostille for all documents executed before us so they are valid and recognised abroad. We do this transparently and save you all the bureaucratic procedures involved.
Tax and registry procedures
Tax bureaucracy can cause a lot of headaches.
So JLA Notarios offers its clients the possibility of assessing and paying the many different taxes by the executing deeds and carrying out other procedures before the notary. We can also file them with the Land or Companies Registry so you do not have to concern yourself with it and can spend your time on the things that matter. We support you from start to finish.
