2023-06-13 00:50:16
Tuesday, June 13, 2023, 00:50
In the same way that we can inherit a house, we can inherit your mortgage. I mean, a debt. With the exception of territories where there is their own foral regime (as is the case in the Basque Country), the Civil Code establishes as a general rule the unlimited liability of the heir. This means that when someone is called to an inheritance and accepts it, he automatically takes the position of the deceased regarding both his assets and his debts or other possible obligations. And this is the case when the testament expressly names us as heirs, but also when the deceased has not formalized his last will and it is the law and the legal succession order that make us heirs.
If we limit ourselves to understanding what happens in the Basque Country when someone dies without having paid off their mortgage loan, it must be remembered that since 2015 Basque Civil Law limits the liability of the heirs. Here you always inherit for the benefit of inventory and, therefore, you never assume debts or put your own assets at risk by accepting an inheritance. If there is indeed a debt, such as a mortgage, the heirs pay it up to the value of the assets included in the inheritance.
Therefore, compared to the only two options that heirs from other regions have (accept the inheritance in its entirety or also renounce it in its entirety), article 21.2 of Law 5/2015 offers us a third possibility; inherit for the benefit of inventory without the need to make an express declaration before a notary. And it does so by also offering a certain guarantee of collection to the creditors of the deceased by allowing them to ask the judge for the formation of an inventory and the separation of assets to avoid that if the heir also had debtors they could collect before them.
An important nuance; In order for Civil Law to be applied, it is essential that the testator has a Basque civil residence, which implies residing for ten years in the autonomous community, a period that can be reduced to two if we go through the Civil Registry to record our desire to acquire it. It should not be confused, therefore, with the administrative neighborhood, which depends on the registration
In regions where common law applies, on the other hand, the inheritance must be assumed or refused in its entirety. If it is accepted, it is done assuming that there may be debts that will have to be paid in full, even if it is using one’s own assets. And if it is rejected, it is necessary to forget both the possible debts and the goods free of them. However, the law also assumes exceptions to which it is not applied in such a rigorous way and admits that the liability of the heir is limited. Thus, it is allowed to inherit for the benefit of inventory, for example, to protect minors or people with few resources or the disabled from onerous inheritances. If we are not in these cases, there is also the possibility of resorting to this formula, but to do so, an express declaration must be made before a notary within the established deadlines, so it is convenient to know in advance what is in the inheritance.
If we accept the inheritance and assume the payment of the part of the pending loan, we must know that the financial institution will have to incorporate all the heirs into the ownership of the mortgage loan and that, as the Bank of Spain clarifies, “the debt remains unchanged.” This means that “the same conditions that were established in the loan contract are maintained until the outstanding amount is paid. The interests, the expiration period, the associated expenses of the mortgage, etc., do not vary.
In addition, the entity must not require additional guarantees or the contracting of new products in cases in which all the existing heirs (whether one or more) take charge of the debt. You can only do so when they all agree that only one or more of them will be awarded the debt, releasing the others from their payment. Be careful, because to reach this type of agreement the entity must give its consent.
Finally, it must not be forgotten that the heirs must also assume the different taxes, such as inheritance tax or municipal capital gains, as well as all the expenses related to the inherited home (community of owners, supplies, etc.).
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