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The bare property is a legal figure of old date and that some years ago have become valid given the economic circumstances that we live in. Some investors have found this market niche attractive where it is generally accepted to deliver an income - temporary or for life - in exchange for obtaining this property conditional on usufruct.
When, by taking this new asset into account –after complying with the requirements of the law and signing the respective deeds–, it may be subject to seizure like any other element of the heritage.
Should a court enter an order to compensate damages or simply to replace a loan not canceled on time, it is perfectly possible to repossess the bare property.
Nuda ownership and asset balance
Let us remember that the peculiarity of being the undisputed owner of a property is that its value can be accounted for in your personal balance sheet, despite not having the rights of use and enjoyment.
Precisely and for this same reason, in a property subject to embargo where there is previously one or more usufruct holders, the new owner is obliged to respect this condition and can only take full ownership after the usufruct has expired.
The bare property is fully negotiable and can even be mortgaged for liquidity; however, its value will always be limited to the conditions imposed in the agreed usufruct contract.
Depending on the term of validity –temporary or life- and taking into account the age of the usufructuary, the amount is determined for any negotiation related to the property.
The usufructuary does not lose prerogatives
Although the usufructuary does not have decision-making power over the negotiations that can be made with his old property, if an income mediates between him and the bare owner, the fact that the property is disposed of may be cause for concern if it is not explicitly indicated in the contract who will be responsible for subsequent payments and under what conditions.
And it is that by losing the incentive to have the possibility of acquiring full ownership of the property, the one who pays the rent could begin to default without now having consequences, since the bare ownership of the property does not belong to him.
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Legally, it is not possible to transfer the responsibility and commitments of a contract to another person without the consent of the parties expressed in a new document, so the usufructuary has to be very clear in this situation.
Rental contract drawn up by specialists
Hence the importance of consulting with specialists in the field when establishing the terms of the signing of an assignment of bare property in exchange for rent , either temporary or for life.
Ideally, the bare owner maintains fluid communication with the usufructuary and informs him in a timely manner if he has plans to negotiate the property, in order to reach agreements and avoid undesirable situations.
The seizure of the bare property can not only occur as a result of having pledged the real estate to obtain capital through a loan, but because it is part of the equity of the bare owner, it is subject to offsetting debts or resolving disputes of other origins.
The courts will determine in such situations the actions and penalties that a person must assume after failing to comply with the financial commitments to which they have subscribed.
In any case, the usufructuary will be protected by law by the contract that he entered into at the time with the person to whom he transferred the bare property and that must rest in the corresponding real estate records.