As we have commented in previous articles, our legislation contemplates several types of mortgages (common, legal and mortgage bonds). In this article we will refer to the legal mortgages derived from condominium obligations, since it seems fundamental that you are aware of the importance of keeping up with the payment of installments and their consequences.

The legal mortgage is a type of mortgage which arises not from a contract between a debtor and its creditor, but from the Law. The legal mortgage arises from the urgency or the need to legally protect some vital obligations and rights.

Currently, legal mortgages are recognized, such as those generated from debts for municipal taxes, property taxes, water services and from condominium fees. These mortgages are also called hidden mortgages, since they normally do not show up in the public records, however, once constituted and registered, they have the same effects as common mortgages, without the need for the direct and express intervention of the debtor.

The characteristics of the legal mortgage are the following:
· Legal origin since they have been foreseen and authorized by the legislator.
· Exceptionality, since they imply a derogation of the common law based on reasons of public utility.
· Accessory nature. The privilege is accessory to the respective credit.
· Indivisibility, since the privilege subsists independently of the division of the credit or of the thing.
· Privilege. In case of prior encumbrances, the legal mortgage will substitute a first-degree mortgage for auction purposes.
Article 20 of the Condominium Property Law specifically regulates this figure:

“Article 20.-The subsidiary property will be affected, as a guarantee, in a preferential manner and from its origin, for the non-compliance of the pecuniary obligations that the owner may have with the condominium.

The installments corresponding to the common expenses owed by the owners, as well as the fines and the interest they generate, shall constitute a mortgage lien on the subsidiary property, only preceded by the lien referring to the real estate tax. A certified public accountant shall issue the certification of the sums owed by the owners for these concepts; this certification shall constitute an enforceable mortgage lien. (Thus amended by Article 1 of Law No. 8278 of May 2, 2002)”. What is underlined and in bold is not part of the original.

As indicated in the transcribed article, the debts arising from delinquent condominium fees, imposed fines, and the interest generated will constitute a legal mortgage at the moment that a Certified Public Accountant issues a certification stating the existence of such debts. This CPA will constitute an enforceable title, so that the Manager will be duly authorized to file the foreclosure process against the debtor condominium owner.

The items left unpaid must have been previously approved by the Condominium Owners Assembly; therefore, at the moment of acquiring a Condominium it is essential to review: a) That it does not maintain debts; b) The current Condominium Regulations in order to know the monthly obligations.

In ERP Lawyers we have extensive experience in Real Estate Law and condominium issues, and will gladly assist you with all your needs, do not hesitate to contact us at info@erplawyers.com.