Did you know what a Deed of Granting Mortgage Rights is? This document is issued by the creditor to the borrower when applying for a loan secured by mortgage rights, such as land or property.
When taking out this type of loan, it is important to first understand this deed, including its requirements, procedures, and costs. Read this article to the end for complete information about the Deed of Granting Mortgage Rights (APHT).
What Is a Deed of Granting Mortgage Rights?
The Deed of Granting Mortgage Rights, abbreviated as APHT, is a legal document that regulates the granting of mortgage rights by the creditor to the borrower.
Through this mortgage right, the borrower (debtor) is legally bound to guarantee repayment of the loan to the creditor according to the agreed amount.
Based on Law Number 4 of 1996, the object of this right may be land or property. If the property is jointly owned, all owners must sign the document.
Difference Between APHT and SKMHT
As explained earlier, APHT is a deed of mortgage tied to the borrower in the name of the owner. Meanwhile, SKMHT (Power of Attorney to Grant Mortgage Rights) is a document authorizing the granting of mortgage rights.
With SKMHT, the creditor may impose mortgage rights even though ownership of the property is not yet under the borrower’s name.
However, SKMHT is only temporary and must be followed up with an APHT for the mortgage right to be valid.
Scope of APHT
The subjects and objects of law in this process are outlined in the APHT.
APHT is a formal legal instrument that establishes the mortgage right, and therefore its essential elements must be stated according to the law.
Generally, the legal subjects of APHT are divided into two:
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The grantor of mortgage rights (the debtor).
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The holder of mortgage rights (the creditor).
Both may be individuals or legal entities. Without the involvement of these two parties, the deed is not legally valid.
Meanwhile, the legal objects of APHT are land or property. These must be described in detail in the deed. According to Article 4 of the Mortgage Rights Law, the objects may include:
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Right of ownership.
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Right to cultivate.
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Right to build.
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Right to use, either on privately owned land or state-owned land, provided it is registered, transferable, and can be encumbered with mortgage rights.
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Land rights along with buildings, plants, and works that already exist or will exist as one unit with the land, and belong to the land title holder named in the APHT.
Legal Force of APHT
APHT must be made before a Land Deed Official (PPAT). At this stage, it does not yet have full binding legal force on third parties, only on the involved parties.
Therefore, APHT cannot yet serve as a basis for execution if the debtor defaults. To gain legal enforceability, the APHT must be registered at the Land Office.
Once registered, you will receive a Mortgage Rights Certificate (SHT), which is recorded in the land book. In addition, an endorsement will be attached to the Land Title Certificate.
The legal basis for APHT includes:
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Article 13 paragraphs (1) and (5) of the Mortgage Law (UUHT), stating that mortgage rights arise upon registration in the land book by the Land Office.
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Law Number 4 of 1996 on Mortgage Rights over Land and Related Objects.
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Law Number 5 of 1960 on Basic Agrarian Principles.
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The Civil Code.
Requirements for a Deed of Granting Mortgage Rights
According to the mortgage law, several requirements must be met to obtain APHT:
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The mortgage right must be promised as loan repayment security.
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Identity of the owner and the grantor of the mortgage right, including address, loan details, mortgage value, and the object, must be stated in the deed.
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Registration at the local Land Office.
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The APHT must include the executorial phrase: “For the sake of justice based on the belief in Almighty God.”
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If the debt is not repaid, the creditor gains rights to the object through auction.
How to Apply for a Deed of Granting Mortgage Rights
The application process involves the following steps:
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The bank issues a credit agreement as a loan condition, containing the borrower’s statement of repayment commitment.
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A Debt Acknowledgment Letter is made before a notary, stating that the debtor has applied for credit and the creditor has approved it.
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Once both are completed, the APHT is made and signed by the creditor and the property owner.
Process of a Deed of Granting Mortgage Rights
The APHT process includes:
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The mortgage right is imposed by the landowner in favor of the creditor before a PPAT.
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The mortgage right is then registered at the Land Office.
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Both parties (debtor and creditor) must be present and sign the deed during its execution before a PPAT.
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The APHT is made by the PPAT for the creditor’s benefit, followed by the issuance of a Mortgage Rights Certificate (SHT) by the Land Office.
The drafting of APHT must comply with the following regulations:
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Article 2 paragraph (2) regarding Partial Royal Promises.
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Article 11 paragraph (2) regarding Creditor and Debtor Agreements.
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Article 20 concerning the execution of mortgage rights if the debtor defaults.
Costs of a Deed of Granting Mortgage Rights
Debtors are required to pay APHT costs once all requirements are met. The estimated costs include:
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Certificate Check Fee: Rp100,000.
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Tax Validation Fee: Rp200,000.
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BBN (Transfer of Title Fee): Rp750,000.
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SK (Decision Letter) Fee: Rp1,000,000.
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AJB (Sale and Purchase Deed) Fee: Rp2,400,000.
Disclaimer: APHT fees may vary depending on the notary and the location of the property. Typically, the fee ranges between 0.25%–1.25% of the loan value. However, this percentage is not a fixed legal standard.
That is the complete explanation of the Deed of Granting Mortgage Rights. Before making one, ensure you fully understand the requirements, process, and costs.
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