Why the land register extract can become a burden

When inexperienced owners sell their property, they often underestimate the importance of the land register. If, for example, it turns out during the notary appointment that Grandma Inge has registered a lifelong right of residence in the land register, this can have far-reaching consequences. On the one hand, such an entry often reduces the sale price; on the other hand, the prospective buyer could even withdraw from the purchase altogether. However, there are even more reasons why you should be familiar with the land register.

The land register extract not only records the ownership of your property, but also any rights and restrictions attached to it, such as rights of residence and use, mortgages, and any insolvency notices. All of this makes the land register extract one of the most important documents when selling your property. Professional real estate agents are thoroughly familiar with the land register extract and know what to look for in the entries.

Real estate liens

Land charges, also known as mortgages, are documented in Section III of the land register extract. They secure the rights of creditors and allow them to foreclose on the property if the debtor defaults on their obligations. Mortgages are the most common type of land charge. Therefore, this section of the land register is particularly relevant for banks.

Residential and pre-emption rights

Section II documents the rights of residence or usufruct. These remain firmly documented even with frequent changes of ownership. Occasionally, heirs discover that the deceased was not actually the owner of the property, but merely held a lifelong right of residence. This case is particularly troublesome, as the property can neither be inherited nor sold.

However, Section II doesn't just document lifelong residential rights. It also includes rights of first refusal, easements for rights of way and utilities, and notices of conveyance. These rights are also considered encumbrances on the property and can not only restrict the owner's options when selling, but also reduce the sale price.

No sale without a land registry extract

Since the land register extract not only shows the encumbrances on a property but also provides information about ownership in Section I, it is indispensable when selling real estate. It is the actual proof of ownership of the property to be sold.

Are you unsure which documents you really need to sell your property? Contact us! We'd be happy to advise you.

You can find more information here:

https://www.t-online.de/finanzen/immobilien-wohnen/eigentuemer/id_76675914/grundbucheintrag-was-kostet-er-mich-und-wie-laeuft-das-ab-.html

http://www.grundbuch-portal.de/

https://de.wikipedia.org/wiki/Grundbuch

Legal notice: This article does not constitute tax or legal advice for any specific case. Please consult a lawyer and/or tax advisor to clarify the facts of your individual situation.

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