I just found out that the bank stopped the procedure and will not be dealt with my application for a mortgage. Although I have a credit score – said Timothy Hossa from.
He wants to build a house outside the city. A year ago, he bought agricultural land, acquired the building conditions, and then the building permit. In the next step, she applied for a loan. Before it was, came into force a government law restricting rotation of the earth. In accordance with applicable from 30 April 2016. Mortgage regulations on agricultural property can not exceed the market value of the property of a mortgage.
It’s a big problem for banks and investors. So far, the borrower lend out more than the current value of the plot, and instead established the right of a sufficiently high mortgage securing the loan. The Bank took into account that the value of real estate as the investment will grow. In other words, even if a plot was worth eg. 100 thousand. zł, it was possible to build a house to get 200 thousand. zł, a mortgage set up on 400 thousand. zł (including secured to the payment of interest).
– When you change the rules in the case of agricultural property is not possible – confirms legal adviser, Dr. Arthur Muranowicz of office Gardocki and Partners Advocates and Legal Advisers.
– Banks have been surprised by the change of the law and actually inhibit credit procedures. Part of the demands other than agricultural land protection. Not everyone, however, has the possibility of finding security, covering a few hundred thousand – says Roman Budnik, credit counselor from Szczecin.
As we agreed, PKO BP sends to people applying for a loan letter explaining the reasons for which halted their investigation applications. And in this context, recalls the new law on trade underground. It provides at that applied to the Ministry of Agriculture and Rural Development for clarification.
What is important – and as is apparent from the letters sent by the PKO BP – the problem with the credit facility may also be the owners of the parcels not covered by the restrictions laid down in the new law, and thus, among others with an area less than 0.3 hectares. The reason?
– The legislature on the one hand agreed to restrictions on trading not related to these properties, the other did not took care of it, not to refer to them, the new rules governing the amount of mortgage collateral. In short, on those parcels can not be a mortgage in excess of their value – explains lawyer Maciej Gorski from the Institute for the Study of Law, Real Estate.
According to the lawyers, the problem does not apply to agricultural land, which in the local spatial development plans provided it is under development. In most local governments such plans, however, does not cover or only a small portion of land.
backfire in the building
– New regulations are in addition to the restrictions on the acquisition of agricultural property also quite new rules for securing debt in the form of mortgages on such properties – said Dr. Arthur Muranowicz, legal counsel with the law firm Gardocki and Partners Advocates and legal Advisers.
explains, new solutions so limited ability to protect the interests of creditors – financing institutions, namely banks – that practice, this may prevent the financing of investments to such plots.
– Not fast, full and effective satisfaction by creditor discourages him certainly to finance such projects – he added.
the problem is the content of art. 68 of the Law on Land and Mortgage Registers, to which paragraph. 2a (Journal of Laws of 2013. Pos. 707, as amended. – Further u.k.w.h.). Under it the sum of mortgage on agricultural property (within the meaning of the Act on shaping the agricultural system) does not exceed the market value of the property at the date of the hedge. The application for entry into the mortgage must be accompanied drawn up by the appraiser an appraisal.
– Before changing the laws could receive credit for 100 thousand. zł the collateral mortgage on a plot of 50 thousand. zł. It knew that the value of the property of the building will exceed 100 thousand. zł, so I will be with you to satisfy the claim, if discontinuation of loan repayments – describes the situation of Marta Nowak attorney with the law firm Kawczyński Korytkowska. – Today I get credit only for 50 thousand. zł, and the value of the property must confirm before the appraiser, which will increase the cost of taking out a loan – explains the effects of the amendment.
Reasonable proceedings
Hence – as he says – it is not surprising that the banks do not want to risk. – Their conduct is the most reasonable – says the lawyer.
While the legislature did not provide for sanctions for the establishment of a mortgage worth more than the value of the property. But doubtful that such a court, higher than permitted by law, mortgages entered. – But if it happened debtor would cease repayments and to defend himself before the investigation, the bank liens – notes lawyer Nowak.
In such situations, the court to which trafiłby dispute could solve it two ways.
– Accept that mortgage security has power only up to the value of the land at the time of its establishment, or – on the basis of art. 58 par. 1 of the Civil Code – stated that mortgage activity as contrary to the Act is entirely invalid. And then it turns out that the bank has no collateral at all – indicates lawyer Marta Nowak.
It turns out that the problem with mortgage guarantees will also apply to parcels of less than 0.3 ha, so those that after 30 April 2016. they can be freely sold. How convincing advocate Maciej Gorski, the error of the legislator, because the objective of the amendments to the Law on Land and Mortgage was to prevent blocking emption ANR through the establishment of mortgages exceeding the value of the land.
– But if the agricultural land with an area less than 0.3 hectares from the provisions of which the right of first refusal, then there is no basis for this, that in relation to these properties apply to limit the sum of mortgage – says lawyer Mountain.
I – he says – is hoping that the legislature giftbox reflection and agricultural property to 0.3 ha are consistently excluded from the application of Article. 68 paragraph. 2a u.k.w.h.
Guidelines bank
Until then, wishing to build a loan on farmland may have trouble getting money. As we read, eg. In the development of PKO BP bank does not protect the property:
● that in the local spatial development plan or theories of urban planning are intended for agricultural (regardless surface property)
● which these documents are designed at least partly use of agricultural (not applicable when the function of agriculture is the only supplement)
● which do not have adopted local development plan, the feasibility study does not indicate the purpose of the land and the real estate issued zoning and land use,
● which have been granted building permit and land register property listed as agricultural property (unless the zoning plan or feasibility study is not due to be other than agricultural)
● designed for farm and Habitats.
According to the lawyers, to finance investments – and hedge mortgages – on agricultural parcels also discourages spectrum of enforcement proceedings, if the borrower does not wywiązałby of the loan agreement.
– If you meet by a creditor with a mortgage repossessions agricultural property (an area of at least 0.3 hectares – ed.) may be sold only to a natural person having the status of an individual farmer with the relevant qualifications, residing in the municipality of the location property. This is a very limited circle of buyers, and thus quickly and effectively satisfy the creditor – notes Artur Muranowicz.
Mr. Mountain added that it is difficult today to estimate what the value will be parcels of land for a year or two years.
– Therefore, banks are afraid to lend under their protection. Unfortunately, the natural consequence of the restrictions in the agricultural land will be a significant drop in its value. As long as the price of agricultural land is not stabilized, banks will be secured venture – accents.
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