Real estate law, land registration and mortgages
Real estate law, land registration and mortgages
The exam tests how immovable property is transferred, made opposable to third parties, and encumbered. Luxembourg runs a transcription system, not a Torrens register, so ownership and publicity must be kept distinct.
Transfer and transcription
- A sale of immovable property must be recorded in a notarial deed.
- Ownership passes solo consensu under article 1583, but the sale is opposable to third parties only after transcription at the mortgage bureau of the Administration de l'enregistrement, des domaines et de la TVA.
- The notary must apply for transcription within the statutory period; late transcription weakens the buyer's position against later creditors.
Mortgages
- The hypothèque conventionnelle is created by notarial deed and takes effect against third parties by inscription.
- Rank follows the date of inscription, not the date of the deed.
- Before completion the notary obtains an état hypothécaire and secures mainlevée or uses the price to discharge existing creditors.
Worked example
A seller's property carries a bank mortgage. The notary obtains the mortgage state, sees the inscription, and inserts a clause that the price is paid directly to the bank, which grants mainlevée. The buyer's deed is then transcribed and the mortgage cancelled. Had the notary ignored the inscription, the buyer would take subject to the bank's charge and could sue for professional liability.
Traps
Transcription does not create ownership; it makes the deed public. Do not forget the 1% transcription duty, servitudes, or the urban-planning constraints examined in domain 8.