What is a land and mortgage register, and why is it important when buying a house?

13.02.2025

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What is a land and mortgage register, and why is it important when buying a house?

You are browsing listings for houses for sale. You find the perfect offer: a ground-floor apartment with a garden, in a great location, and at a reasonable price. Everything seems perfect. But then you come across one sentence: "No possibility of financing." The reason? No land and mortgage register.

In this article, we cover the following topics:

1. What is a land and mortgage register?
2. Why do old apartments in Warsaw lack a land and mortgage register?
3. Unregulated land – what does it mean?
4. Is the primary market a guarantee of a land and mortgage register?
5. What does a land and mortgage register provide?

What is a land and mortgage register?

A land and mortgage register is an official register that confirms the legal status of a property. It contains information about the owner, any mortgage encumbrances, the rights of other individuals to the property, and restrictions on its use.

Thanks to the land and mortgage register, you can verify if the property you wish to buy truly belongs to the seller and whether there are any debts on it. It is a necessary document for obtaining a mortgage loan and crucial for the safe purchase of a house.

Why do old apartments in Warsaw lack a land and mortgage register?

In Warsaw, many apartments, especially in older cooperative housing blocks, do not have a land and mortgage register. The reason lies in the property management system during the communist era, when cooperatives built apartments but did not always formalize their legal status by establishing registers.

Owners of such apartments have cooperative ownership rights to the unit, which means the property is not formally registered. This is a significant inconvenience for buyers – the lack of a land and mortgage register can pose a challenge, especially when the buyer plans to finance the purchase with a mortgage. Banks usually require a mortgage entry in the land and mortgage register as a form of collateral. The absence of this document can complicate the entire process. However, this does not mean the buyer is unable to obtain a loan. It may require additional actions, such as providing alternative documentation. Additionally, in such cases, banks may require extra collateral (securing their claim on another property besides the one being purchased) or simply refuse to grant the loan.

For years, there has been a process of converting these apartments into full ownership, but the formalities are complicated and time-consuming. On the market, there are still apartments without a land and mortgage register, and purchasing them requires additional legal steps.

Unregulated land – what does it mean?

Another common reason for the lack of a land and mortgage register is unregulated land. This means that the building where the apartment is located stands on a plot of land with an unclear legal status. Often, these are municipal or state-owned lands, where ownership has not been officially confirmed or registered.

These issues date back to the communist era, when the state took over land for housing development without precise property records. In some cases, former owners or their heirs file claims, further complicating the situation.

The lack of regulated land prevents residents of buildings from establishing a land and mortgage register for their units. This excludes the possibility of obtaining a mortgage loan and limits the ability to freely manage the property. While the city is gradually addressing these issues, the entire process is complex and time-consuming.

Is the primary market a guarantee of a land and mortgage register?

When purchasing a new house or apartment in a developer's estate, you can be sure that the property will have a land and mortgage register – although not always immediately. During the construction phase, the developer holds a land and mortgage register for the entire plot on which the estate is being built. Only after the completion of the investment, the establishment of ownership of the residential unit, and the transfer of its ownership to the buyer, is an individual land and mortgage register created for the specific unit. The application for the establishment of a land and mortgage register for the new unit is usually submitted by the notary before whom the parties sign the contract transferring ownership of the property.

This is a standard process that does not hinder the obtaining of a mortgage loan – banks are well aware of it and finance the purchase at the stage of signing the notarial deed. After the ownership is transferred to the buyer, an application is made to the court to establish the land and mortgage register, and any encumbrances, such as a mortgage in favor of the bank, are then entered. In practice, this means that the absence of a land and mortgage register at the time of purchasing a new house is not an issue – it is simply a matter of formality, which is resolved after the transaction is finalized.

Construction - Osiedle Młodych

What does a land and mortgage register provide?

- The possibility of obtaining a mortgage loan – banks require a land and mortgage register to grant a loan.

- Transaction security – you can verify who the actual owner is and whether the property is encumbered with any debts.

- The possibility of selling in the future – most buyers finance their purchase with a loan, so the lack of a land and mortgage register can complicate the sale.

- The option to secure a loan – even if you buy with cash now, you can use the property as collateral for a loan in the future.

Summary

When buying a new house in a developer's state in Warsaw and its surroundings, you can be sure that it has a land and mortgage register, which provides you with full freedom and security. If you come across an offer for an apartment or house without the possibility of financing, think twice before making a decision. The lack of a land and mortgage register may lead to problems not only now but also in the future.

Are you planning to buy a property? Check out the new states of terraced houses in Lesznowola, houses with gardens in Białołęka or intimate estates in Wilanów and choose a safe solution.