Between the Assignor and the Assignee
The assignment transfers the loan and all its accessory rights, according to Article 1258 of the Spanish Civil Code, which includes guarantees such as surety, mortgage, pledge, or privilege, unless excluded in the assignment agreement. If the assignment is partial, the extinguishment of the assignor’s ownership will also be partial.
Effects of the Assignment Regarding the Debtor
The debtor’s position should not be affected; the debt does not increase or decrease, nor does the guarantee change, unless the debtor participates in the assignment with their consent. The debtor’s relations with the assignor or assignee depend on whether they have been notified of the assignment.
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Without Notification to the Debtor: If the debtor has not been notified, payment to the original creditor is liberatory. If the debtor pays and the assignment is registered before the mortgage cancellation, the Resolution of the DGRN of February 19, 2018 establishes that Article 144 of the Mortgage Law does not affect the successive assignee if the debtor was not notified of the assignment. The extinguished credit does not revive for the party who made a valid payment.
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With Notification to the Debtor: If the debtor has been notified, they must fulfill their obligation to the assignee. Securitization of loans does not alter the relationship between the issuing bank and the mortgage debtor. The lending bank has active standing to claim the loan and initiate foreclosure, even in the event of loan securitization. It also has passive standing against claims from the debtor.
Effects of the Assignment Regarding Third Parties
Effects against third parties require registration of the assignment.
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Acquirers in Case of Double Assignment: In the event of a double assignment, registration determines priority, protecting the first to register according to Article 34 of the Mortgage Law.
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Acquirers of Rights: Those who rely on what is published in the Registry, such as creditors who improve their rank or are subrogated into the loan and mortgage.
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Creditors of the Assignor: Creditors who attach the assignor’s credit without the assignment being recorded in the Registry and who are unaware of it.
Non-third parties include a mortgagor who is not a debtor, a third-party possessor, or those with rights registered after the mortgage.
