Mortgage holder's duties and application forms
During land reform, a mortgage is established when acquiring land if the option to pay for the land in installments, i.e., on credit, is used during privatization.
If there were several eligible persons for the return of land and some of them chose compensation instead of land, the other eligible persons had the option to purchase the compensated part of the land. In this case, it was also possible to use deferred payment to pay for the land, and a mortgage could be placed on the returned property in favor of the state.
Applications should be submitted by e-mail to [email protected] or by post to Mustamäe tee 51, 10621 Tallinn.
- If the land is encumbered with a mortgage in favor of the state, consent must be sought from Land and Spatial Development board for logging.
- Logging can significantly affect the value of the land, and it is in the mortgagee's interest to ensure that logging does not reduce the value of the collateral to such an extent that it could prejudice the rights of the mortgagee, i.e. the state.
- The application must be submitted to Land and Spatial Development board together with a valid forest management plan, forest notification, and a power of attorney from the representative of the legal entity.
- A mortgage can be deleted from the land register after the land purchase debt and associated obligations have been paid in full.
- The deletion of a mortgage does not take place automatically; the landowner must submit an application to Land and Spatial Development board for the deletion of the mortgage.
- After the payments secured by the real encumbrance have been paid in full, the real encumbrance shall be deleted.
- To do so, the owner of the immovable property must submit an application to Land and Spatial Development board for the deletion of the real encumbrance in order to obtain consent.
- Upon receipt of the application, Land and Spatial Development board will verify that the payments secured by the real encumbrance have been made. If the payments have been made, consent will be granted.
- The consent of Land and Spatial Development board must be sought in order to divide a property encumbered with a mortgage.
- Before the division, an assessment must be made as to whether the land remaining after the division is still of sufficient value to cover the obligations associated with the mortgage.
- This may require an appraisal report prepared by a licensed appraiser. In exceptional cases, consent may also be obtained without an appraisal if the division is in the public interest or if it can be reliably determined on the basis of available data that the division does not jeopardize the rights of the mortgage.
If a property with a mortgage established in favor of the state is sold, the consent of Land and Spatial Development board is required to transfer the debt to the new owner. The assumption of the debt obligation must be formalized by a notarized agreement.
Before submitting an application for the transfer of the debt obligation, please ensure that the land parcel is not subject to any restrictions under the Restrictions on the Acquisition of Immovable Property Act (KAOKS).
KAOKS imposes the following restrictions on the acquisition of immovable property:
- A legal entity of a contracting state* has the right to acquire immovable property comprising ten hectares or more of agricultural land if they have been engaged in the production of agricultural products listed in Annex I to the Treaty on the Functioning of the European Union, except for fish products and cotton, for the three years immediately preceding the year of the real estate acquisition transaction.
- A legal person of a contracting state has the right to acquire immovable property comprising ten hectares or more of forest land if it has been engaged in forest management within the meaning of the Forest Act or in the production of agricultural products for the three years immediately preceding the year of the transaction for the acquisition of the immovable property.
- A natural person who is not a citizen of a contracting state of the European Economic Area or a legal entity whose place of residence is not in a contracting state of the European Economic Area are prohibited from acquiring immovable property in the following areas or, in the event of a change in the size or name of the areas, within the boundaries existing as of December 31, 1999:
- sea islands, except for Saare and Hiiumaa, Muhu, and Vormsi;
- Ida-Virumaa: the cities of Narva, Narva-Jõesuu and Sillamäe, and the municipalities of Alajõe, Iisaku, Illuka, Toila and Vaivara;
- Tartumaa: the municipalities of Meeksi and Piirissaare;
- Põlvamaa: Mikitamäe, Orava, Räpina and Värska municipalities;
- Võrumaa: Meremäe, Misso and Vastseliina municipalities.
*Contracting State = Republic of Estonia or another contracting state of the European Economic Area or a member state of the Organisation for Economic Co-operation and Development
The mortgagee has the right to give consent to the transfer of the purchase debt to the acquirer of the immovable property upon the transfer of the immovable property if the immovable property encumbered with a mortgage is transferred directly to a relative, sister, brother, spouse, registered partner, or a person who takes over the debt obligations of the owner of the immovable property as a result of enforcement or insolvency proceedings. When reviewing the application, an assessment is made as to whether the new owner has sufficient funds to pay the debts.
If immovable property encumbered with a mortgage in favor of the state is sold to a person to whom the purchase debt cannot be transferred, the entire amount owed to the state must be paid and the mortgage deleted before the immovable property can be transferred.
A person whose child was born after June 7, 1996, has the right to apply for the cancellation of the land purchase debt or a reduction in the sale price of up to €1,600 for each child born after June 7, 1996, when privatizing land with a preemptive right or in a restricted auction. (for example, in the case of twins, the parent is entitled to receive the benefit for two children).
The amount of the purchase debt cancellation (€1,600 per child) may be used to cancel the purchase debt incurred in the privatization of several plots of land with preemptive rights or to reduce the sale price.
To receive the benefits, you must fill out an application. When filling out the application, please note the following:
- indicate the place where the person permanently or mainly resides as their place of residence;
- the cancellation of the purchase debt must be indicated if the land sale contract has already been concluded;
- a note should be made in the box for the refund of the overpaid amount if the unpaid portion of the sale price is less than €1,600 or the sale price has been paid in full (including as an advance payment), regardless of when the land purchase agreement was concluded;
- if the applicant or the other parent has previously used part of the benefit arising from the birth of the child, the privatization of which registered immovable property and to what extent the benefit has been used shall be indicated. The application must be accompanied by a decision to cancel the previous purchase debt or a corresponding signed agreement;
- if the land purchase debt or sale price is less than EUR 1,600, the person has the right to use the unused portion in the future when privatizing land.
- A private landowner who has at least four children under the age of 18 to raise and support is entitled to apply for the cancellation of land purchase debt in the amount of €1,600.
- Only one person raising children is entitled to this benefit.
- If the outstanding portion of the debt is less than €1,600 or the debt has been paid in full (including advance payments), the private landowner has the right to apply for a refund of the overpaid amount.
- In the case of land purchase agreements concluded before November 30, 1997, the sale price may be reduced or the purchase debt written off if the private individual was raising and supporting at least four children under the age of 18 on that date.
- After November 30, 1997, the purchase debt may be written off or the sale price reduced if the children were being raised and supported by the privatizer at the time of conclusion of the land purchase and sale agreement or if a child born after the conclusion of the purchase and sale agreement is also the fourth of the children under the age of 18 being raised and supported by the privatizer.
Additional information
Valgamaa, Võrumaa, Viljandimaa, Põlvamaa, Tartumaa, Jõgevamaa, Ida-Virumaa
| Name | Phone | Email address |
|---|---|---|
| Tiiu Tõugjas |
508 7389 |
[email protected] |
Harjumaa, Pärnumaa, Läänemaa, Raplamaa, Saaremaa, Hiiumaa, Järvamaa, Lääne-Virumaa
| Name | Phone | Email address |
|---|---|---|
| Birgit Vinter |
529 4572 |
[email protected] |
| Name | Phone | Email address |
|---|
Last updated: 31.10.2025
