Why is the appraisal certificate necessary in the mortgage loan deeds?
As in any legal issue, it is convenient to delve a little into the history of the institution to find the foundation of the present legislation. We can differentiate three moments in the evolution of the mortgage:
a.- From 1861 to 1915.
It should be noted that originally, as the mortgage was configured by the Mortgage Law of 1861, the determination of a value of the mortgaged property was not a requirement for its constitution, nor therefore for the granting of the public deed or for registration in the Land Registry.
b.- From 1915 to 1981.
The determination of a value begins to be required when the so-called summary judicial procedure is introduced, which has its origin in a reform of the Mortgage Regulations of the year 1915. Thus, as additional requirements, to be able to execute the mortgage by a faster system, the called summary procedure, it is established that the deed of constitution of the mortgage must include an appraisal value of the property and a debtor's address for the practice of requirements and notifications. This was intended to avoid the process of appraisal of the property in the ordinary procedure of execution, with the delays that this could entail.
c.- From 1981 to 2013.
The previous situation remained unchanged until 1981, when Law 2/1981, of March 25, regulating the mortgage market, was promulgated. This law introduces the requirement for the appraisal of the mortgaged property, but not as a requirement for establishing the mortgage, but rather as a requirement for the mortgage loan to be used as coverage for an issue of mortgage securities, that is, for its mobilization. through the secondary mortgage market.
Thus, the appraisal imposed by the regulations governing the mortgage market is not a requirement established in general for all types of mortgages, but exclusively in relation to those that are constituted in accordance with the regulations of the mortgage market. In such cases, the appraisal makes it possible to guarantee compliance with the limits imposed on the amount of credits that can serve as collateral for the issuance of mortgage certificates or bonds (limits set at a percentage of the value of the properties mortgaged in their guarantee).
d.- The current situation.
The current situation derives from Law 1/2013, of May 14, on measures to strengthen the protection of mortgage debtors, debt restructuring and social rent, by now imposing for all mortgages, intended or not to serve as coverage for a issuance of mortgage titles, as a legal requirement to be able to exercise the real mortgage action through the direct foreclosure procedure or extrajudicial sale, the double condition that the property has been previously appraised in accordance with the Law regulating the mortgage market and that the appraisal value for the purposes of the auction is not less than seventy-five percent of that carried out in accordance with the aforementioned legislation.
The purpose of this regulation is to guarantee that property awards are not made for ridiculous amounts, although it is also true that the law could have been a little more generous, forcing the auction appraisal value to coincide with the resulting of the certificate provided.
However, it should be noted that the appraisal certificate is necessary for the real mortgage action through the direct foreclosure procedure or extrajudicial sale, but not as a requirement to be able to constitute the mortgage. In fact, if the appraisal certificate is not provided to the deed, what will happen is that the Registrar will not register the submission to the special procedures, with the consequence that in the event of execution it will be necessary to resort to the ordinary executive procedure, in which case The value for auction purposes of the property will be determined for this purpose by an expert appointed in accordance with the provisions of Articles 637 and related articles of the Civil Procedure Law.
Having made this brief exposition, we are going to make a small summary, adding some more question that the practice reveals:
When is the appraisal certificate necessary??
We can say that always, due to the fact that financial institutions do not originally waive the exercise of mortgage action through special procedures, despite the fact that theoretically it is only necessary when it is intended that the mortgage loan can be used as coverage for a issuance of mortgage certificates and/or when it is intended to be used to exercise the real mortgage action through the direct execution procedure or extrajudicial sale.
¿What should the appraisal certificate look like??
Issued by an approved appraiser and not expired (six months).
Is it necessary in mortgages between individuals?
Yes, when the foreclosure is agreed by real mortgage action through the direct foreclosure procedure or extrajudicial sale. No, otherwise.
¿It is necessary in mortgage renewals?
The General Directorate of Registries and Notaries, in view of the issues that are being raised in application of the law in force since May 2013, has indicated that only when the appraisal value is modified, it will be necessary to accompany the deed with a new certificate of appraisal. Otherwise, even if there is a mortgage extension, it is not necessary to accompany the novation deed with an appraisal certificate.