What is the nature of the assignment of credits?

Article by: Maria Carmen Zaragoza | Last update: April 10, 2022
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The assignment of credit is that legal transaction by which a creditor (assignor) transmits to another person (assignee creditor) the rights that the first holds against a third person, unrelated to the transmission, but who becomes a debtor of the new creditor without that the original relationship is extinguished.

What is the nature of credit?

The nature of credit titles can be analyzed in two aspects: as a document and as pre-established proof, which follows from the treatment given by the Law.

What is the transfer of credits?

The assignment of credits is defined as a legal transaction that is concluded between the creditor and another person, in order to transfer ownership of the debt.

Where is the transfer of credits regulated?

1112, Civil Code, the general rule is the assignability of credits, except when the law or the parties provide otherwise. The sale or assignment of a credit, as contemplated in Art. 1528, Civil Code includes that of all accessory rights, such as bail, mortgage, pledge or privilege.

How is the assignment of credits between companies taxed?

Taxation of the transfer of credits

If the transferor of the credit is a taxpayer of VAT (that is, he is not the final consumer) and the transfer occurs in the exercise of his activity, the transfer is subject to VAT, although exempt from VAT and not subject to TPO .

23 related questions found

How is a mortgage loan assignment taxed?

The assignment of mortgage credit is taxed on the effective mortgage guarantee, that is, on the capital pending amortization.

How is the tax on documented legal acts calculated?

For example, to calculate the AJD, if we take the Community of Madrid as a reference, the tax is 0.75%. It must be multiplied to the Mortgage Responsibility (principal + ordinary interest + default interest + costs and expenses) which, let’s say, is 350,000 euros. Thus, €350,000 x 0.75% = €2,625.

Who regulates the transfer of rights?

Article 2029. There will be a transfer of rights when the creditor transfers to another the rights he has against his debtor.

How is the transfer of credit notified?

In order for the assignment to take effect against the debtor and against third parties, said debtor must be notified or accepted by him (art. 1960 ib.) and the notification is made “with the display of the title, which will include the transfer of the right with the designation of the assignee and under the jimia of the assignor.” (art.

How is a credit assignment contract made?

The assignment of a credit consists of the creditor assigning the title or right to a third party called the assignee. Thus, a bank that has made a loan to a client for the purchase of an apartment, can assign said loan to another bank.

When is the transfer of credit given?

“the assignment of credit arises from a contract between the original creditor (assignor) and the new creditor (assignee), whereby the assignor undertakes to transfer and guarantee the assignee the credit or other right”35.

What is the origin of the credits?

The word “credit” has its origin in Latin. Specifically in creditum, which can be translated as “trusted thing”. Therefore, this word means to entrust something to another person, in this case money. Because it consists of that, entrusting money to someone who will return it later.

What is the executive nature of credit titles?

… the executive nature of a title of credit consists in the fact that it is a preconstituted proof of the action brought in the trial, which legally means that the executive document exhibited by the author is a demonstrative element that in itself makes full proof, and therefore this, if the defendant opposes a…

What is credit in the legal sense?

(Civil Law) Synonym of personal law; generally used to designate the right to demand the delivery of a sum of money. V. Debt, Obligation.

Who notifies the assigned debtor?

National Civil and Commercial Code. Article 1428. Notification to the assigned debtor. The transfer of the assigned credit rights must be notified to the assigned debtor by any means that reasonably evidences receipt by the latter.

What does notice of assignment mean?

This notification must contain enough data so that the debtor can recognize the credit that is being assigned. In addition, we must not forget the essential data: data of the assignor, assignee and the bank account where the credit must be paid when it is due.

How is a transfer of rights formalized?

According to the Federal Civil Code (CCF), the assignment of rights occurs when the creditor transfers to another the rights he has against his debtor, so that to formalize this act it is necessary to execute the corresponding contract.

Who is the assignor and assignee?

The RAE defines it as follows: “Said of a person or an entity: That gives, transfers a thing, action or right”. Two figures emerge from this process: the transferor, already defined, and the transferee, which refers to the person who benefits from the transfer.

What is the validity of a transfer of rights?

Effectiveness of the assignment of rights

It has a bilateral character: the acceptance of the assignor and the assignee is necessary for the contract of assignment of rights to be valid. Assignable right: there must be no legal impediment to the transfer of rights to a third party.

Who pays for the 2020 documented legal acts?

And one of the fundamental modifications affects the IAJD: since the implementation of the new regulations, the Tax on Documented Legal Acts related to the signing of the mortgage loan must be assumed in full by the bank (before it was the buyer who had to take care of the).

What is the ITP and AJD?

The Tax on Patrimonial Transfers and Documented Legal Activities (ITP and AJD) is a tax (percentage to be paid) that is applied to three types of acts: Transfers (purchases and sales) of goods or rights between individuals, provided they are for financial consideration ( in exchange for money).

What is a mortgage assignment?

The assignment of a credit is a legal act by which a creditor, who takes the name of assignor, voluntarily transfers the credit or personal right he has against his debtor to a third party, who accepts and who takes the name of assignee.

Who buys mortgage debt?

Banks buy credit card and personal loan debt, mortgage debt, and auto loans.

Why are credit titles executive?

A title of credit is a necessary document to exercise the literal right that is consigned in it, and is capable of bringing about execution against the obligor, being called an executive title.

What are the characteristics of credit titles?

Within what are credit titles and their characteristics we have: incorporation, legitimation, literalness, autonomy, abstraction and substantivity.

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