Mortgage

A mortgage (ipotek) is a security right established over immovable property to secure an existing or future claim. If the debt is not paid, the creditor may have the property sold through enforcement proceedings and be satisfied from the proceeds; ownership does not pass to the creditor.

Creation requires an official deed at the land registry office and registration. Mortgages in favour of banks securing housing loans are the most familiar example. The property may still be sold and used despite the mortgage; the encumbrance follows the property into the hands of new owners, and several mortgages may coexist within a system of ranks.

Full payment of the debt does not automatically delete the mortgage from the register; a release letter from the creditor is needed for removal. Mortgages left on the record after the claim has ended are a typical complication surfacing at the time of sale.