Mortgage (Hypothek)
Mortgage (Hypothek) in German real estate: definition, difference from a land charge (Grundschuld), and current practical significance.
Financial
§ 1113 ff. BGB
Also known as: property mortgage, real estate mortgage
The Hypothek (mortgage) under German law is a real property lien that is tied to a specific claim (accessory). It is automatically extinguished when the secured claim is repaid. In modern financing practice, the mortgage has largely lost its significance - banks prefer the more flexible land charge (Grundschuld). (§ 1113 ff. BGB)