Endorsing a mortgaged person is a really important commitment. Do not forget that, in the event of non-payment of the loan, respond with your present and future assets. Under normal conditions, the guarantor cannot lose anything to fear, but the crisis of a few years ago showed us that a person may be responding to his debt one day and losing his job and staying in the street the next day, having lost his home and that of the guarantor, in addition to having this to continue paying. In this post, we detail issues such as when the endorsement would disappear and when they might have no doubts.
The guarantor will only breathe easy when the mortgaged party has completely settled the outstanding debt. In this regard, it should be noted that the limitations are required financial cancellation, no registration. This means that it is not necessary to issue a zero debt certificate or go to the notary to grant the deeds of the payment letter, and also not go to the Property Registry. The guarantor will be free when he has paid all the mortgage payments to the creditor.
Sometimes, the guarantee is extinguished before because its wording includes abusive clauses that introduce an obvious imbalance between creditor and debtor. Most commonly, the guarantor is renounced to the rights of excuse, division and order without his being aware of it. Sometimes it happens that, when claiming the restoration of these benefits, the bank agrees and the guarantee remains and its nullity is not declared.
If the bank does not explain in detail the conditions of the guarantee or gives erroneous information about its duration or limits, it would be incurring a total lack of transparency. This type of opaque negotiations may result in the nullity of the guarantee before the courts. The truth is that each case is a world and that a judge considers a guarantee a disproportionate guarantee in relation to the risk assumed depends on the circumstances in which it was signed and the details of the process.
Limiting the guarantee is one of the methods that reduce the burden of liability of the guarantor. An endorsement can be limited to a specific amount, that is, it could cease to be active when the mortgaged party has paid 20% or 30% of the outstanding debt, for example. It can also be limited in time, for example, to the first ten years. In both cases, you have to negotiate and leave everything in writing to avoid future problems.
It is one of the most common alternatives to avoid a comprehensive guarantee. The non-debtor mortgagee only guarantees a property. Thus, in the case of a foreclosure, you would only respond with this good. However, it should be known that while the loan is in effect, such housing cannot be sold or mortgaged. In the past, guarantor and non-debtor mortgagee went hand in hand in the scriptures, which was clearly disproportionate and abusive.