Mortgage debt | Inversión inmobiliaria
A credit supported by a mortgage collateral is acquired under this modality. The purchase of credit does not amount to an automatic purchase of property.
What does NPL mean?
NPL is the usual name of a non-productive or non-performing loan. Not every mortgage debt is an NPL: every opportunity should indicate the credit status and its documentation.
What is being acquired?
The crediting position with respect to the terms of the assignment. The transmission of credit includes its attached rights under applicable rules. The scope of the assignment and the guarantees and their formalities should be checked.
What does the result depend on?
Any collection, price paid, time and expenditure. The value of the property that acts as a guarantee isn't an insured amount of recovery.
Building a Recovery Scene
The economic survey should separate the balance claimed, the divestiture price, intended expenses and an estimated collection. It's useful to compare a negotiated solution with other scenarios, with time, potential incidents and legal costs. A high discount on the nominal does not by itself prove that there is good investment.
Specific documentation and risks
Requests the contract, modifications, balance and security documentation. Legal review should address legitimization, limitation, potential dispute and status of proceedings. It is also necessary to evaluate liquidity: an exit may require an uncertain time and there is no guaranteed recovery.
To identify the credit, its holder and the guarantee.
Check balance, file and range of loads.
Compare recovery scenarios and costs.
To formalise the assignment and plan credit management.
Do I get the keys to the property while buying the debt?
No. The crediting position is acquired under the terms agreed and legally applicable. Any acquisition of the property requires its own means and formalities.
Do all unpaid credits have the same treatment?
No. The contract, debtor, security, dispute and procedural status matter. The potential application of dispute claims rules should be analysed on a case-by-case basis.