How much Does it Cost to Cancel a Mortgage?

When you reach the end of your mortgage payment or decide to sell your home ahead of time, a very common question may arise: how much does it cost to cancel a mortgage? Canceling it does not always mean that it automatically disappears from the Land Registry, and this procedure may have a cost that you should know in advance. In this post we explain how to cancel a mortgage, whether it is mandatory to do so, and what expenses it involves.

Is it Mandatory to Cancel the Mortgage?

The answer is that it is not mandatory to cancel the mortgage in the registry, but it is highly recommended. When you finish paying your loan, the mortgage is no longer economically active, but it is still registered in the Land Registry. This can cause problems if, for example, you want to sell the property or apply for a new loan.

Therefore, although it is not mandatory to cancel the mortgage immediately, doing so guarantees that your property is free of registry charges.

How to Cancel a Mortgage Step by Step?

If you are wondering how to cancel a mortgage, these are the steps you should follow:

1. Request a zero debt certificate from your bank, a document that proves that you have already paid the entire loan.
2. With this certificate, you will have to go to a notary to prepare the cancellation deed.
3. Finally, the deed must be taken to the Land Registry to remove the registry charge.

Mortgage Cancellation Costs: who Pays Them?

The mortgage cancellation costs may vary, but usually include:

• The notary fees.
• The registry fees.
• If you use a manager, they will also charge for the service.

In total, canceling a mortgage can cost between 300 and 1,000 euros, depending on the initial amount of the loan and the professional fees. In all cases, the loan holder assumes the mortgage cancellation costs, unless otherwise agreed.

Mortgage Cancellation Due to Expiration: when Does it Apply?

There is the possibility of a mortgage cancellation due to expiration, that is, the Registry eliminates the charge after 20 years from the last loan maturity. However, this procedure may take time and is not useful if you need to carry out immediate procedures, such as selling the apartment or house. In addition, it requires an application and documentation.

Although you can wait for the mortgage cancellation due to expiration, the most practical thing is usually to cancel it voluntarily at the end of the payment.

Can the Mortgage be Canceled at the Time of Sale?

Many times it is decided to cancel the mortgage at the time of sale of a home. This is totally normal and can be done on the same day that the deed is signed before a notary. In that case, the outstanding amount is usually withheld from the sale price and paid directly to the bank.

If you are planning to sell, make sure that the property is free of charges or that you can cancel the mortgage at the time of sale, to avoid delays or inconveniences.

Cancel your Mortgage without Complications with Espígul

At Espígul we accompany you throughout the mortgage cancellation process. Whether it is because you have just paid it off or because you need to do it to sell, we take care of the management with the notary and the registry so that you do not have to worry about anything.

We guarantee you an agile, close and totally transparent service, so that you understand from the first moment how much it costs to cancel a mortgage and what steps you must follow. If you want to make it easy, count on us. Contact us for more information!