Antichresis o Contrarium Mutuum (breve ensayo de una solución jurídica para un problema económico)

Abstract: 

From article 1.881 and following of the 1889 Spanish Civil Code, we take the institution known as the “antichresis” from a historical, doctrinal and legislative point of view. Indeed, against what the great majority believes, the current regulation of antichresis rules makes it possible to hold a contract that isn’t designed to ensure the fulfillment of a principal obligation with the possibility of promoting judicial or extrajudicial execution against the property, given to that effect by the debtor, in case of default by the debtor of the secured obligation which usually consists on the repayment of a sum of money. Rather, the contract offers to the creditor, any creditor, not a guarantee but a mean of payment. So, a creditor, who may be entitled to any benefit, would settle the outstanding debt through the collection of the civil fruits produced by either urban or rural property. The management of the real property would be under the creditor control (the property would remain in debtor’s hands) as long as needed to settle the outstanding debt. Therefore, the aforementioned management would require a permanent and necessary accountability in order to apply, if that’s the case, the sums collected to the interests of the principal debt and then to the capital, specifying so the amount of the debit balance.
Leaving, out of simplicity, the hypothesis of a very old meaning of the term “antichresis” in so far as “contrarium mutuum” aside, for this would imply the 10 use of someone else’s capital in exchange of the use of someone else’s property so, in due time, the two parties would make restitution of capital and property. The fact is that, in critical times, the previously indicated right of anthichresis
could be used as a mean of payment in order to avoid a hard and “settled” foreclosure in those cases in which a mortgagor is being evicted for its incapability of meeting its outstanding repayments.
In short, what is suggested, is to “convert” a mortgage credit or a mortgage loan, every time “the justice” requires so in “an antichresis contract / means of payment”. Thus, on one hand, the debtor would keep the ownership of the property and, on the other, the creditor, in terms agreed by the parties or “suggested” by the law itself, would continue collecting receivables as long as necessary in
order to settle the debt. In addition to this, there would be no need for banks and financial institutions to become holders of real estate properties whose management should, in principle, be alien to their social object and their interests For this purpose, it is essential judicial intervention, applying current legislation and resources that the law requires and justice demands, as well as the intervention of the legislative authority that, in short, will provide regulatory clarity that the world demands.

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