Regulations on handling secured assets such as houses and land

(Baonghean) - On February 22, 2012, the Government issued Decree No. 11/2012/ND-CP amending and supplementing a number of articles of Decree No. 163/2006/ND-CP dated December 29, 2006 of the Government, which added two cases of handling secured assets such as land use rights and assets attached to land when there is no agreement on the method of handling.

Firstly, in the case of mortgaging only the land use right without mortgaging the property attached to the land and the land user is also the owner of the property attached to the land, the property attached to the land shall be disposed of at the same time as the land use right, unless otherwise agreed. The parties have the right to negotiate themselves or through an organization with the function of appraising property prices to have a basis for determining the value of the land use right and property attached to the land. The amount of money collected from the disposal of the secured property shall be paid in advance to the owner of the property attached to the land, unless otherwise agreed.

Second, in the case of mortgaging only the land use right without mortgaging the property attached to the land and the land user is not at the same time the owner of the property attached to the land, when handling the land use right, the owner of the property attached to the land is allowed to continue using the land according to the agreement between the land user and the owner of the property attached to the land, unless otherwise agreed. The rights and obligations between the mortgagor and the owner of the property attached to the land are transferred to the buyer, the recipient of the land use right.

Also according to this decree, future assets are accepted as collateral, but do not include land use rights, but only include the following types of assets: Assets formed from loan capital; assets in the process of formation or being legally established at the time of entering into the collateral transaction; assets formed and subject to ownership registration, but only after the time of entering into the collateral transaction can such assets be registered in accordance with the provisions of law.

These amendments and supplements take effect from April 10, 2012.

NT (Synthesis)