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Antichresis

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There are many legal resources that exist to ensure the payment of a loan or the economic protection of a property. One of them is called antichresis , and it is a kind of agreement or contract that is applied to a good, in order to settle a credit that has not been paid. Basically it allows the creditor to get hold of the profits produced by said thing or property, until the debt has been canceled. At first, the antichresis will be in effect until the debtor pays off the commitment, but if you want to know more details, you should read below.

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What is antichresis?

According to the Civil and Criminal Code, antichresis is nothing more than a contract by which a debtor must grant the deserving authority and rights to a good , so that he can receive the benefits produced by said good. They can be charged annually or monthly until an acquired debt is settled. Once the commitment is settled, the asset could return to the debtor’s hands. In essence, it is a kind of pact that is made between two parties, in which one gives the other the right to its property, until it can pay the debt.

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  • Characteristics of antichresis
  • Rights and obligations of each involved
  • Resolution of the antichresis agreement
  • Contract models
  • Difference between mortgage, usufruct and antichresis

Characteristics of antichresis

  • This contractual document is constituted on real estate, for example: houses, farms, etc.
  • It is a concrete agreement: it is refined with the delivery of the property, however it does not give the deserving authority any power over it, it will only have power over the fruits that the property generates.
  • It is Unilateral: the obligations only fall on the deserving person, who has the duty to allocate the profits, initially to interest, then to the amount owed. Likewise, you must pay the taxes and contributions that fall on the property.
  • It is secondary: It is derived from a main contract and its purpose is to guarantee a duty acquired in said agreement.
  • It is consensual: at the time of the ordinance, both parties must agree and be fully aware of the duties to which they are committing themselves.
  • It is of a successive period: it requires an extremely long period of time for the economic purpose proposed by the parties to be successfully achieved.
  • It is a protection treaty: since it does not give the plaintiff a true right to possession.
  • Only one antichresis can be consummated on that single property , that is, it is not possible to carry out several antichresis treaties on the same object, since it would be impossible for the antichresis to award the same home or premises, for example, simultaneously to several deservers.

Antichresis, due to its nature as a contract, requires for its validity the fundamental components common to the other agreements. Likewise, by its nature, it requires the delivery of the thing, and since it is a secondary contract, it presupposes the existence of an obligation that precedes it.

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It contains the following components common to all contracts:

  • Intention
  • Basis
  • Approval
  •  Competence

It also includes components of antichresis:

  • Tradition
  • Validity according to the valid initial obligation.

Rights and obligations of each involved

In each country the formalities for the execution of this type of contract vary. In some places, they suggest registering it at the office corresponding to the location of the property. However, certain rights or obligations have been established that each of the parties must comply with to guarantee the legality of the procedure.

Rights of the deserving

  • It has the power to seize the profits of the property , since this is the essence of this transaction. In fact, the law protects him and allows him to use the property, as well as to enjoy the fruits that accrue, whether natural (those that come from the entity, with or without the intervention of man) or civil (when they are obtained circumstantially. )
  • The agreement grants the plaintiff the power to keep the property until his debt is fully paid . It does not give you any other privileges.
  • Only if the contrary is agreed, the deserving person has the obligation to cancel the rent and established tax rates of the property and also the necessary arrangements. Likewise, you have the right to receive a reimbursement of said expenses, with a royalty of the profits.
  • In the event that you do not agree to what is stated in the previous article, the creditor has the freedom of action to return the entity at the time it deems it prudent and establish another legal way to obtain the payment of your credit without detriment to the opposite of what had been stipulated.

Obligations of the deserving antichresist

There are several obligations that can be separated into 4 groups:

  • Obligation to administer: within this, there are several other obligations that the creditor must complete during a certain period of time. They are listed below:
    • Obligation to attribute : in the first instance, the profits are attributed to the interest owed and in the second place they are attributed to the capital. This obligation involves a series of activities and commitments to fulfill:
      • Operating expenses.
      • Income and Taxes.
      • Utility .
      • Profits.
    • Sanction: It will be sanctioned through the laws that regulate the function of administering the tax. If neglect is shown in the exploitation of the property or that it fails to pay the contributions, rents or repairs, the sanction will also apply if the building presents any damage.
  • Obligation to justify: administering entities or properties of others results in the commitment to render accounts at the end of their administrative management. In this way, it is tested whether or not there was a decrease in debt.
  • Obligation to protect the property, as well as to notify any new damage: being empowered to benefit from someone else’s property, it will be necessary to have the obligation to protect the building and notify any damage generated to the property.
  • Obligation to return the thing: according to what is established in the contract, at the end of the contract, the deserving anticresista is obliged to return the thing.

Owner responsibilities

  • It must provide the corresponding endowment for the health, by defect or defect, of the property as well as to keep the anti-stress plaintiff in a quiet possession of the thing.
  • You must return the expenses incurred to the deserving person.
  • You must have legal approval from the lender to establish easement.

Resolution of the antichresis agreement

There are two forms of termination, as well as all secondary contracts:

  • By result:
    • It occurs when the original cargo is extinguished for various reasons.
    • When the insolvent contracts a new commitment after having established the antichresis and the object is demanded, the first deal is not extinguished until the second debt is canceled.
    • During the time that the antichresis is in force, the primary obligation cannot prescribe, if the claimant retains power over the property, it is presumed that it is because the debt still exists.
  • By main road:
    • Due to expiration of the contractual or legal objective.
    • By compliance with a resolution clause.
    • For loss of the property or the thing referred to in the antichresis.
    • When the creditor has exceeded exercising its power.
    • When the deserving person resigns the antichresis contractual document.

Contract models

There are several models of antichresis contract:

  • Anticresis of an exploitation: When the part that owes gives the antichresist the rights to exploit the land in order to obtain a profit with the profits generated from it.
  • Anticresis of a boat or commercial premises: The right to use a ship or premises that produces profits for its rental or industrial exploitation is granted.
  • Anticresis of a house or room: this particular does not generate profits. It is allowed in some countries. It is assumed that the savings obtained instead of renting a room or a house represents a profit that can be deducted from the total amount of the debt.

Difference between mortgage, usufruct and antichresis

The main difference between these contracts occurs because in the antichresis the deserving person has the power to appropriate the profits generated by the entity to attribute them to the interest or capital of the debt, both inclusive. This particularity is not present in the usufruct .

In stipulations of the Usufruct, the creditors are empowered to enjoy a foreign property without having any profit , that is, for their own benefit, but not to obtain any income.

Mortgage : it is a right that the deserving person possesses in which the return of a loan built on a property is involved. This agreement considers the good without taking into account the amount or value that has been delivered for it.

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