Second Trust Deed Template for Germany

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Key Requirements PROMPT example:

Second Trust Deed

"I need a Second Trust Deed for a commercial property in Berlin valued at €5 million, where the first trust deed is for €3 million, and we need to secure an additional €1 million loan that will be used for property renovations, with the transaction closing planned for March 2025."

Document background
The Second Trust Deed is utilized in German real estate financing transactions where a property owner seeks additional financing while maintaining an existing first trust deed. This document is crucial when property owners need to leverage their equity position for additional funding, common in both commercial and residential real estate scenarios. The Second Trust Deed must comply with German property law requirements, particularly the Bürgerliches Gesetzbuch (BGB) and land registry regulations. It includes specific provisions addressing priority and subordination to the first trust deed, detailed property descriptions, secured obligations, and enforcement mechanisms. The document is typically registered in the German land register (Grundbuch) to perfect the security interest and establish priority rights.
Suggested Sections

1. Parties: Identification of the Trustor (property owner), Trustee, and Beneficiary (lender)

2. Background: Context of the transaction, including reference to the first trust deed and the underlying loan or obligation being secured

3. Definitions: Key terms used throughout the deed, including property description, secured obligations, and relevant German law concepts

4. Creation of Security Interest: Express creation of the trust deed and acknowledgment of its second-priority status

5. Property Description: Detailed legal description of the encumbered property as registered in the German land register

6. Secured Obligations: Description of the debt or obligations secured by the trust deed

7. Covenants of the Trustor: Trustor's obligations regarding property maintenance, insurance, taxes, and compliance with laws

8. Priority and Subordination: Provisions regarding the relationship with the first trust deed and other potential encumbrances

9. Default and Remedies: Events of default and available remedies under German law

10. Enforcement Provisions: Procedures for enforcement in accordance with German forced sale regulations

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

Optional Sections

1. Insurance Requirements: Detailed insurance obligations when specific insurance requirements are needed beyond standard coverage

2. Environmental Provisions: Specific environmental warranties and covenants when the property has environmental risks or concerns

3. Cross-Default Provisions: Provisions linking defaults under other loans or the first trust deed when required by the lender

4. Property Management: Specific requirements for property management when the property is commercial or requires professional management

5. Assignment and Transfer: Detailed provisions regarding the ability to assign or transfer rights when not covered by standard terms

Suggested Schedules

1. Property Description Schedule: Detailed technical description of the property including cadastral information and land register details

2. Secured Obligations Schedule: Detailed description of the secured loan or obligations, including payment terms and conditions

3. Prior Encumbrances Schedule: Details of the first trust deed and any other prior registered encumbrances

4. Insurance Schedule: Specific insurance requirements and minimum coverage amounts

5. Form of Land Register Application: Template for the German land register application (Grundbuchantrag) for registration of the security interest

6. Powers of Attorney: Required powers of attorney for land register registration and enforcement actions

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

Relevant Industries

Real Estate

Banking & Financial Services

Commercial Property Development

Residential Property Development

Property Investment

Construction

Real Estate Investment Trusts (REITs)

Property Management

Relevant Teams

Legal

Real Estate

Finance

Risk Management

Compliance

Property Management

Investment

Credit Administration

Corporate Banking

Real Estate Development

Relevant Roles

Real Estate Lawyer

Property Finance Manager

Mortgage Specialist

Real Estate Investment Manager

Property Portfolio Manager

Legal Counsel

Banking Relationship Manager

Real Estate Transaction Manager

Risk Manager

Compliance Officer

Property Development Director

Real Estate Fund Manager

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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