Mortgage Purchase Contract for Germany

Mortgage Purchase Contract Template for Germany

A German Mortgage Purchase Contract (Hypothekenkaufvertrag) is a legally binding agreement governed by German law that facilitates the transfer of mortgage rights from one party to another. The document must comply with the German Civil Code (BGB), the Pfandbrief Act, and relevant banking regulations. It details the terms of the mortgage transfer, including the purchase price, representations and warranties, and transfer mechanics. The agreement requires notarization under German law and must be registered with the land registry (Grundbuch) to effect the transfer of mortgage rights.

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What is a Mortgage Purchase Contract?

The Mortgage Purchase Contract is a specialized agreement used in German financial markets to transfer mortgage rights between financial institutions or qualified investors. This document is essential when banks want to sell their mortgage portfolios, refinance their lending operations, or when investors seek to acquire mortgage assets. The contract must comply with strict German legal requirements, including mandatory notarization and registration in the land registry (Grundbuch). It contains detailed provisions about the mortgage being transferred, purchase price calculations, representations about the validity of the mortgage, and the mechanics of transfer. The document is particularly relevant in the context of portfolio transactions, securitizations, or individual mortgage sales, and must adhere to German banking regulations and the German Civil Code (BGB).

What sections should be included in a Mortgage Purchase Contract?

1. Parties: Identification of the seller and purchaser of the mortgage, including full legal names, registration details, and addresses

2. Background: Context of the transaction, including details about the existing mortgage, the underlying property, and the purpose of the transfer

3. Definitions: Key terms used throughout the contract, including technical banking and legal terminology

4. Subject Matter of Sale: Detailed description of the mortgage being sold, including principal amount, interest rate, and maturity date

5. Purchase Price and Payment: Specification of the purchase price, payment terms, and payment mechanics

6. Transfer of Mortgage: Legal mechanics for transferring the mortgage rights, including land registry requirements

7. Representations and Warranties: Seller's confirmations regarding the validity and status of the mortgage

8. Closing Conditions: Prerequisites that must be satisfied before the transfer can be completed

9. Costs and Taxes: Allocation of transaction costs, including notary fees and registration costs

10. Notices: Communication procedures between parties

11. Governing Law and Jurisdiction: Confirmation of German law application and jurisdiction for disputes

What sections are optional to include in a Mortgage Purchase Contract?

1. Seller Financing: Terms for any deferred payment of the purchase price, used when the purchase price is paid in installments

2. Security Arrangements: Additional security provisions, needed when collateral beyond the mortgage itself is provided

3. Borrower Notification: Procedures for informing the underlying mortgage borrower, required when immediate notification is part of the agreement

4. Servicing Arrangements: Terms for ongoing mortgage servicing, included when servicing responsibilities are being transferred or retained

5. Further Assurances: Obligations to execute additional documents, included for complex transactions

6. Confidentiality: Provisions for maintaining transaction confidentiality, needed for sensitive commercial transactions

7. Force Majeure: Provisions for unforeseen circumstances, included for longer-term payment arrangements

What schedules should be included in a Mortgage Purchase Contract?

1. Mortgage Details: Complete details of the mortgage including registration number, principal amount, interest rate, payment schedule

2. Property Description: Legal description and details of the underlying property securing the mortgage

3. Land Register Extract: Current extract from the land register (Grundbuch) showing the mortgage registration

4. Payment Mechanics: Detailed procedures for executing the purchase price payment

5. Required Notices: Forms of notices required for various communications under the contract

6. Transfer Documents: Forms of documents required to effect the transfer of the mortgage

7. Due Diligence Documents: List of documents provided during due diligence that form basis of representations

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Germany

Publisher

Genie AI

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Banking and Financial Services

Real Estate

Investment Management

Mortgage Banking

Financial Technology

Legal Services

Property Development

Asset Management

Relevant Teams

Legal

Real Estate Finance

Investment Management

Risk Management

Compliance

Banking Operations

Treasury

Credit Risk

Portfolio Management

Transaction Management

Relevant Roles

Legal Counsel

Mortgage Banking Officer

Real Estate Finance Manager

Investment Manager

Portfolio Manager

Risk Manager

Compliance Officer

Banking Operations Manager

Real Estate Attorney

Transaction Manager

Treasury Manager

Credit Risk Officer

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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