Mortgage foreclosure proceedings in Turkey are initiated by an application to the related Execution Office. An application with the physical file prepared by Lawyer is made to the Execution Office. This file includes Request for Initiation of Enforcement Proceeding (Claim), Execution Writ, Envelope to serve documents, supporting documents of the Debt, stamp for the service of documents, power of attorney and stamp of Bar Union.
Execution Office sends the Writ of Execution / Payment Order together with the supporting documents of the debt, to the debtor.
Also Execution Office sends a notice to the Land Registry informing that the mortgage foreclosure proceedings has been initiated and requests the up to date land registry records of the immovable.
Again Execution Office requests the cadastral extract of the immovable from Cadastre Directorate and zoning status information of the immovable from the Municipality the immovable property is related to.
Lawyer may identify whether the immovable is rented or not. Where it has been established by Lawyer that the immovable is rented, a writ is sent by the Execution Office stating that they should deposit the following rent amounts to Execution Office instead of landlord.
An enquiry for the address of the debtor recorded in an official entity and service of the documents to that address is requested if the documents cannot be served to the debtor.
Writ of Execution and supporting documents attached are sent to the address found to be served to the debtor.
Upon acquiring the cadastral extract from the Cadastrate Directorate and zoning status information from the Municipality, these documents are added to the file of Execution Office and sent by Execution Office to an expert to do the appraisal of immovable.
Expert together with the file sends the appraisal report stating the up to date value of the immovable to the Execution Office.
Appraisal Report is sent to debtor, creditor and 3rd parties that are recorded in the land registry as owners of rights on the immovable property.
Parties may object to the appraisal report, for reasons such as the value of the immovable is high or low, by lodging an application to the Court within 7 days upon the service of the report.
Where an objection is lodged, file is sent to the Court and a new expert is appointed to do a new appraisal.
The decision of the Court is final.
The preparations are initiated for the sale of the immovable by the Execution Office over the new value assessed.
Upon request, Execution Office sets the 1st and 2nd auction date and prepares the announcement of auction.
The date of auction is formed of two dates, 1st and 2nd Auction dates. There is a 10 day period between two dates.
The announcement of auction prepared is served to the debtor, creditor and 3rd parties that are recorded in the land registry as owners of rights on the immovable property. (in practice, the new appraisal report is also attached to prevent problems that may arise during the auction) .
The announcement of auction is sent to the Municipality and appointment of an auctioneer and tax debt information of the immovable is requested. Also announcement of auction is published in one of 5 biggest newspapers throughout Turkey.
Auction takes place on the 1st date set previously. But in any event the auction date has to be served to the parties and has to be held at least 1 month after the announcement of auction is published in newspaper. Otherwise auction cannot be done on the date set previously. Also, auction will not be done, where the information given within the announcement of auction is wrong and related parties object to the auction based on such reason. In such circumstances, a new auction date is set by the Execution Office.
Where the immovable cannot be sold for a total amount over 50% of appraised value and receivables having priorities such as auction expenses and tax debts in the 1st auction date, another auction is held on the 2nd auction date for 50% of appraised value. If the amount collected from the 2nd auction is not over 50% of appraised value and receivables having priorities such as auction expenses and tax debts in total, recommencement of auction proceedings are requested.
Parties attending to the auction have to deposit securities equivalent to 20% of the appraised value. Securities to be deposited shall be deposited in cash or by security letter of a bank on auction day. Parties who do not deposit securities cannot attend to the auction.
Party winning bidding has to deposit immediately purchase price together with expenses, taxes, VAT, land registry fees and expenses in advance. But where a request is made for extra time, a period not exceeding 10 days, may be given by the Execution Office Chief Clerk to the winning bidder for depositing the purchase price.
A lawsuit with a claim such as the auction is held in breach of the legal procedure may be initiated within 7 days after the date immovable is sold. With the initiation of such a lawsuit, auction does not become final and land transactions are not completed until this lawsuit is decided. The amount paid by the winning bidder is held by the Execution Office until the lawsuit is decided.
Auction becomes final if a lawsuit for the termination of auction is not initiated within 7 days. But in practice Execution Office Chief Clerks wait for 21 days.
Land transactions are carried out upon the finalisation of the auction.
In practice, lawsuits for termination of auction are initiated by 3rd parties and especially by the debtors.
Where the immovable property subject to the auction is occupied, Execution Office sends an order for the evacuation of the immovable and requests the evacuation of immovable within 15 days after the order is served.
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