Mortgage in Bulgaria — Types, Creation & Cancellation (2026)

Q: How much does it cost to create a mortgage?

Total costs include notarial fee (0.1–1.5%), state registration fee (0.1%), fees for certificates. For EUR 100,000, estimated total costs are EUR 300–500.

Q: What is the difference between a mortgage and a pledge?

A mortgage is over immovable property and requires a notarial deed. A pledge is over movable property or receivables and may be created without notarial form.

Q: What does renewal of a mortgage mean?

Renewal extends the registration for a new 10-year period. If not carried out in time, the mortgage loses its rank.

Q: How can I check whether a property is mortgaged?

Through an inquiry at the Registration Service. An encumbrance certificate will show all registered mortgages, seizures and other encumbrances.

What Is a Mortgage

A mortgage is a security interest (real right) over immovable property in favour of a creditor (Art. 149 of the Obligations and Contracts Act — ZZD). It provides the creditor with two fundamental rights:

Right of preferential satisfaction — the mortgage creditor is satisfied before unsecured (chirographic) creditors from the proceeds of the property upon forced execution (Art. 136(1)(3) ZZD).
Right of pursuit (droit de suite) — the mortgage “follows the property,” i.e. it remains in force even if the property is sold to a third party (Art. 173(1) ZZD).

A mortgage is an accessory right — it exists only so long as the secured claim exists. Extinction of the principal claim entails extinction of the mortgage.

Types of Mortgage — Comparison Table

Criterion	Contractual Mortgage	Statutory Mortgage
Legal basis	Arts. 166–167 ZZD	Art. 168 ZZD, Art. 60(4) CIA
Form	Notarial deed	Unilateral declaration
Owner’s consent	Required	Not required
Typical cases	Bank loans, commercial security	Unpaid purchase price; credit for property acquisition
Registration	Mandatory	Mandatory

Statutory Mortgage (Art. 168 ZZD)

A statutory mortgage may be registered in favour of: the seller of immovable property (unpaid purchase price), a co-partitioner (supplementation of share), and a bank (property acquired with a bank loan under Art. 60(4) CIA).

Contractual Mortgage (Arts. 166–167 ZZD)

The contractual mortgage is more common in practice. It is created by a notarial deed concluded between the creditor and the property owner.

Creating a Contractual Mortgage — Step by Step

Step 1: Preparing the Documents

Title deed for the property
Current cadastral sketch from AGKK (if applicable)
Tax assessment of the property (from the municipality)
Marital status certificate (if the grantor is a natural person)
Encumbrance certificate for the property
The loan agreement or other document evidencing the secured claim

Step 2: Execution Before a Notary

The notary verifies the identity of the parties, the right of ownership and the existence of encumbrances. The notarial deed must mandatorily contain (Art. 167 ZZD): full names and domicile of the creditor and debtor; a precise description of the mortgaged property; the secured claim, its maturity and interest rate; the amount for which the mortgage is created.

Important: If the property is part of a matrimonial community of property, the consent of both spouses is required (Art. 24(3) of the Family Code).

Step 3: Registration in the Property Register

Registration is a constitutive element — without it, the mortgage has no effect. The notary submits the application on the day the deed is executed. From the moment of registration, the mortgage acquires its rank (Art. 169 ZZD).

Renewal — The 10-Year Deadline

Registration of a mortgage is valid for only 10 years from the date of registration (Art. 172(1) ZZD). If the creditor does not renew the registration within this period, the mortgage loses its rank.

How to Renew

Renewal is effected by a unilateral declaration of the creditor — an application is submitted to the registration judge before the expiry of the 10-year period. No new consent from the debtor or new notarial execution is required.

What Happens If It Is Not Renewed

The mortgage is not extinguished as a right, but loses its rank
It cannot be asserted against registrations made prior to the renewal
The creditor loses their preferential position

Practical tip: If you have a mortgage loan with a 20- or 25-year term, do not forget to renew the mortgage registration before the 10th year expires.

Cancellation of a Mortgage — Procedure and Documents

Grounds for Cancellation

Written consent of the creditor (Art. 179(1) ZZD) — the most common scenario
Final court judgment — where the court establishes that the secured claim does not exist
Expiry of the 10-year period — without renewal
Public sale — following sale of the property at public auction

Cancellation Procedure (with Creditor’s Consent)

The creditor (bank) issues a consent letter for cancellation with notarised signature
The property owner submits an application for cancellation to the Registration Service
The consent letter is attached to the application
The registration judge effects the cancellation

Required Documents

Application for cancellation
Consent letter from the creditor with notarised signature
Certificate of current status of the bank (for legal entity creditors)
Receipt for paid state fee

Fees

Action	Fee (EUR)
Notarial fee for mortgage deed	0.1–1.5 % of the secured claim
State fee for registration	0.1 % of the secured claim
Renewal of registration	0.1 % of the secured claim
Notarisation of consent for cancellation	Approx. EUR 15–30
State fee for cancellation	EUR 5

Special Cases

Mortgage Over a Future Building

A mortgage may cover future structures to be built on the mortgaged land if there is an approved investment project and the parties have expressly agreed (Art. 166(2) ZZD).

Mortgage Over an Undivided Share

A co-owner may freely mortgage their undivided share without the consent of the other co-owners. However, if the entire property is mortgaged by one co-owner, the mortgage is valid only for their undivided share (Art. 167(3) ZZD).

Mortgage and Unseizability

The debtor’s sole dwelling is unseizable under Art. 444(1)(7) GPC. This protection, however, does not apply where the property is mortgaged and the enforcing creditor is the mortgage creditor (Art. 445(1) GPC).

Multiple Mortgages

Several mortgages may be created over the same property. Creditors are satisfied in the order of registration (Art. 169(2) ZZD) — “first to register, first to be satisfied.”

Frequently Asked Questions

Can I sell a mortgaged property?

Yes. The owner may freely sell the property, but the mortgage remains in force — the new owner acquires the property encumbered. In practice, banks require prior repayment and cancellation before or simultaneously with the sale.

What happens if I cannot repay the loan?

The bank may declare the loan immediately due and proceed with forced execution — inventory, valuation and public sale of the mortgaged property. The bank is satisfied preferentially from the proceeds.

Can I mortgage a property in favour of a private individual?

Yes. A mortgage may be created in favour of any creditor — natural or legal person. The form is a notarial deed.

How much does it cost to create a mortgage?

Total costs include: notarial fee (0.1–1.5 % of the secured debt), state registration fee (0.1 %), fees for certificates and sketches. For a mortgage loan of EUR 100,000, estimated total costs are EUR 300–500.

What is the difference between a mortgage and a pledge?

A mortgage is created over immovable property, while a pledge is over movable property or receivables. A mortgage requires a notarial deed and registration, while a pledge may be created without notarial form.

Can a third party mortgage their property for someone else’s debt?

Yes. A third party — mortgage guarantor — creates a mortgage over their own property to secure someone else’s obligation. If the debtor defaults, the creditor may seek satisfaction from the third party’s property.

What does “renewal” of a mortgage mean?

Renewal is the procedure by which the creditor extends the effect of the registration for a new 10-year period. If not carried out in time, the mortgage loses its rank.

How can I check whether a property is mortgaged?

Through an inquiry at the Registration Service at the location of the property. You can request an encumbrance certificate, which will show all registered mortgages, seizures and other encumbrances.

Conclusion

Mortgages are one of the most important security instruments in Bulgarian law. Whether you are purchasing property with a bank loan, providing security for a commercial obligation, or seeking to cancel an existing mortgage, understanding the rules for creation, renewal and cancellation is essential.

This article is for informational purposes only and does not constitute legal advice. For specific questions relating to mortgages, please seek the assistance of a lawyer.