toxicmolotof
2013-10-30 20:37:41
- #1
A land charge is usually registered in the amount of the loan. If this amount is not yet known, there is the possibility of "shooting in the dark" with three consequences:
1) Land charge registered too high. => Everything is fine with the bank, but possibly too much paid at the notary and court, since the fees are based on the amount of the land charge.
2) Land charge registered appropriately. => Probably needs no further explanation.
3) Land charge registered too low. => A good start for the bank, but probably a problem. Either add a second land charge later or apply for the exceeding amount as a personal loan.
The latter option in variant 3 can work for small amounts, but usually leads to an interest rate surcharge due to higher risk.
Why is "too much" a disadvantage? Apart from the unnecessary costs at the notary/court, it is not a disadvantage, but rather an advantage if one wants to finance a car later and the value of the land charge allows for it. A bank cannot enforce more than it has legitimate claims against someone.
1) Land charge registered too high. => Everything is fine with the bank, but possibly too much paid at the notary and court, since the fees are based on the amount of the land charge.
2) Land charge registered appropriately. => Probably needs no further explanation.
3) Land charge registered too low. => A good start for the bank, but probably a problem. Either add a second land charge later or apply for the exceeding amount as a personal loan.
The latter option in variant 3 can work for small amounts, but usually leads to an interest rate surcharge due to higher risk.
Why is "too much" a disadvantage? Apart from the unnecessary costs at the notary/court, it is not a disadvantage, but rather an advantage if one wants to finance a car later and the value of the land charge allows for it. A bank cannot enforce more than it has legitimate claims against someone.