30 Jan 2009 11:26 PM:

      Hi JJ,  Best to  read and understand my first post below to help with understanding this one :-) .

For the paragraph below, :-

   ***,*** Euros, the remainder, will be effective when the dwelling is completed and the corresponding Sale/Purchase deed made a public instrument, by means of the subrogation of the mortgage loan that the vendor has arranged with the banking entity BANESTO for the sum of ***,*** Euros, which must take place 20 days from the application for the licence of first occupation. The vendor will guarantee electricity and water of the works until said document is granted, after which time the interest of the Mortgage Loan will be paid by the buyer. The difference between the remainder and the amount of the mortgage, **,*** Euros, will be paid by the buyer via bank cheque made out to PROMAGA S.A.U at the time the public deed is granted.

This is explaining that if you are taking over the developers mortgage, the mortgage that the developer had is NOT be for the total amount that you owe (by the sum of ***.***Euros, there is a ***,*** remainder (this is the difference between the purchase cost - value of the developers mortgage -your deposit ). This difference must be paid by you by check at the same time you take over the mortgage, which must happen within 20 days of the licence of first occupation. Once this happens you the buyer then have the mortgage, have to pay the interest on the mortgage (and repay the capital). The developer during this process is responsible for ensuring electricity and water is paid for and remains connected, until the the mortgage is taken over. the electricity & water twill also become your responsibility at this point and you need to contact the suppliers to arrange to pay for the services.

Hope this helps,

Best regards,

Geoff.

Community thread: I'm Looking for a 3 bed detached Property with access to a pool in the Quesada area for long term rent.

--------------------------------------

30 Jan 2009 11:02 PM:

Hi JJ,

To answer your question, as to what the paragraph below means:-

The buyer can choose whether to subrogate the mortgage. If the choice is to not subrogate the mortgage, the buyer must inform the vendor at least three months prior to the completion of the dwelling. In this case, cancellation costs for the mortgage are to the account of the vendor. It is agreed that, if the buyer does not inform the non subrogation of the loan to the vendor within this deadline, all cancellation costs  will be to the account of the buyer.

The developer takes out a mortgage to get the money to build the property. You have the option as the buyer to take over the developers mortgage (subrogate).(Doing this can work out cheaper as there are less costs to pay for you than arranging your own mortgage from scratch, but it's potentially more restrictive as you take on the conditions of the mortgage as was agreed with the developer, instead of choosing a mortgage that suites your needs). What this paragraph is saying is if you don't want to take over the developers mortgage, as you want to find your own mortgage, you need to tell them at least 3 months before completion, or else you the buyer will have to pay the costs that the developers bank (or whoever the mortgage is with) will charge the developer for cancelling the mortgage.

Hope this helps,

Best regards,

Geoff.

Community thread: I'm Looking for a 3 bed detached Property with access to a pool in the Quesada area for long term rent.

--------------------------------------