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Should all foreclosures on a property be erased when purchased from bailiffs?

By decision dating from a few days ago Sofia City Court agreed to give an interpretative decision on the question “After conducting a public sale of a real estate, are foreclosures recorded on the property before the public sale subject to deletion?”. The intervention of the judges is needed because currently there are two binding solutions to this issue for the courts, which are in total contradiction with each other. According to one of the opinions, after the successful completion of the public sale all mortgages, foreclosures and real burdens should be erased from the property lot. Another panel of the Sofia City Court is yet of the opinion that a foreclosure seeks to preserve the property of the debtor in his patrimony and is a real burden on the property, but it is not a right in rem. Because of its broad scope, the judges agree that it does not fall within the scope of the provision of art. 175 of Obligations and Contracts Act, respectively its erasure at a public sale is not obligatory.

 

author: Vesela Velinova, attorney-at-law

Member of “Velinov and partners” Consulting House 

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