Mortgage in Poland


Establishment of real estate mortgage is one of many ways of securing a debt.

First of all, it should be indicated that a declaration on establishment of a mortgage must be submitted by the owner of a very immovable property in a form of notarial deed. The advantage of such a solution is that the notary must make sure that the prepared by him notarial deed complies with all required legal norms and includes the proper content. Moreover, the notary will assure that the mortgage is entered into a land and mortgage register because an agreement made between a creditor and a immovable property owner is by itself insufficient.

Mortgage shall become effective upon its entry into a land and mortgage register

Procedure of satisfaction of mortgage

Secondly, mortgage debt shall be satisfied, in the first place, towards other receivable debts. The exceptions are:

  • enfocement costs;
  • due payments for work for up to three months (up to minimum wage);
  • disability insurance due to incapacity for work caused, disease, disability or death;
  • alimony payments (art. 1025

In a situation when a real estate owner has more debts and the moneys from the sale of the real estate by a debt collector would not cover them in full, the mortgage creditor has a priority in dividing the moneys from a said sale, what is perhaps the greatest advantage of securing the mortgage debt.

Encumbrance of immovable property with mortgage

Thirdly, it shall be mentioned that mortgage "follows immovable property", that is it encumbers immovable property regardless of who is its owner. Therefore, each time prior to acquiring immovable property, it is necessary to thoroughly examine the land and mortgage register into which the mortgage is entered for any encumbrances of immovable property disclosed. In case you decide to acquire immovable property encumbered by mortgage, you shall take into account a possibility of a creditor to demand the payment of the receivable secured mortgage debt. If he is unable to recover the payment voluntarily, he may cause a compulsory mortgage sale by the creditor to pay off the debt.

Occasionally it happens that the immovable property you are interested in is encumbered by mortgage debt. In this case you should be cautious but not necessarily refrain from closing a transaction. Sometimes a situation occurs where a debtor selling an encumbered immovable property shall put forward a creditor's certificate concerning the amount of debt. If the debt is lower than the sale price offered, you could  simply direct that part of the price sufficient to cover the debt to the creditor's account and he, after booking the payment, shall issue documents necessary for removing the mortgage from the land and mortgage register.


Marcin Kręglewski


Marcin Kręglewski

Barrister, Partner

Marcin Kręglewski