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Registration Procedures for Mortgage of Pre-sold Commercial Housing for Foreigners
With the development and opening of China domestic real estate market, more and more foreigners look to further increase on it, and it has been a more and more common phenomenon that foreigners' purchasing of real estate in China.
In case of a mortgage purchase, although both the purchaser and the lending bank are foreign natural persons or foreign legal persons and the loan agreement and mortgage contract signed outside, since the purchased real estates are within the territory of China, it will be unavoidable to apply the laws and regulations of China for both the mortgagor and the mortgagee when they do the registration procedures of the purchased real estate. According to laws of China, the parties to the mortgage contract must go to relevant real estate registration department to register the mortgaged real estate, or the mortgage will be deemed as invalid.
Based on relevant Chinese laws and experience in this aspect of our office, the following of this article will give a introduction on how to go through the registration procedures of real estate mortgage for those foreigners who purchase pre-sold commercial housings in Beijing.
According to "Law of the People's Republic of China on the Administration of Urban Real Estate", "The Secured Interests Law of the People's Republic of China", "Administrative Measures on Urban Real Estate Mortgages" and relevant local laws and regulations of Beijing, the parties to the mortgage should go to the local real estate registration department in the vicinity of the property to register the mortgaged real estate within thirty (30) days of the singing of the mortgage contract.
Since the required documents for mortgage registration are rather complicated, and many departments will be involved in, therefore both parties to the mortgage usually entrust Chinese lawyers to do the mortgage registration for them. In that case, the mortgagor and the mortgagee could entrust two lawyers from one law office to act as their agents separately to go through the registration procedures. The main procedures of mortgage registration for real estate is as details as follows:
1. the mortgagee shall submit the original attorney agreement together with copy of the company registration certificate which should be notarized and attested in its locality;
2. the mortgagor shall (i) in case of a natural person, submit the original attorney agreement together with copy of his/her personal certificate which should be notarized and attested in its locality, (ii) in case of a company, submit the original attorney agreement together with copy of the company's registration certificate which should be notarized and attested in its locality, meanwhile, the mortgagor shall also provide decision on the mortgage passed through on the meeting of its board of directors.
3. the mortgagor shall fill the "summary of mortgaged real estate" and do relevant notary and attestation of it;
4. Submit the mortgage contract and the loan agreement singed by both parties to the mortgage to the registration department for examination and putting on record;
5. Go and get the "Beijing Urban and town real estate mortgage registration application form" from the real estate registration department, this form should be filled and signed by the mortgagor and mortgagee;
6. Submit the following documents to the registration department:
A. "Beijing Urban and town real estate mortgage registration
B. the "Contract of Beijing pre-sold commercial housing for
foreigners", two originals, one copy (three in total);
C. Mortgage contract, original and copy (three in total);
D. Loan agreement (copy);
E. "Summary of the mortgaged real estate";
F. lender's registration certificate, which should be notarized and
attested in its locality.
7. Pay the registration fee.
In addition, according to the requirement of real estate registration department, all the above mentioned documents should be written in Chinese, if they are written in foreign language, it shall be translated into Chinese and be notarized at a Chinese notary office.
After examination on qualified real estate mortgage contract as well as other documents and the object in pledge, real estate registration department will make record of mortgage registration on the mortgagor's "contract of pre-sold commercial housing for foreigners" with a real estate mortgage stamp on it, and issued a "Mortgage registration certificate of the pre-sold commercial housing" to the mortgagor.
It usually takes two months for the completion of the mortgage registration since the day on that both parties to the mortgage submit all the above mentioned documents to the real estate registration department. However, it should be noticed that when the mortgage has been totally implemented, the parties shall go to the real estate registration department to do the nullification procedures.