BRAZIL Trends and Developments Contributed by: Ivandro Ristum Trevelim, Rafael Jordão Bussière and Fabio Perrone Campos Mello, Campos Mello Advogados
sumed that the debtor and, if applicable, the third-party grantor, are in an unknown place when they are not found at the property loca - tion given as collateral or at the last address they provided, and it is considered inaccessible if the employee refuses to accept the notification or if there is no employee available for this purpose. Also, in the second auction referring to the col - lection procedure, default remedy, consolidation of fiduciary ownership, and auction resulting from financing for the acquisition or construc - tion of residential property, the minimum bid to purchase the property is composed of the debt guaranteed by the oldest fiduciary sale, plus expenses and charges; and if there is no bid meeting the minimum requirement for purchase, the debt will be considered extinguished, with reciprocal discharge, in which case the creditor will have the free availability. As for the collection, default remedy, consolida - tion of fiduciary ownership, and auction resulting from financing for the acquisition or construction of non-residential property, the minimum bid in the second auction will be the debt plus expens - es and charges. However, if no bid reaches that value, the fiduciary creditor may choose one that corresponds to at least half of the property’s appraisal value, and the creditor may judicially enforce the remaining amount. Therefore, unlike fiduciary sale of residential property, the debt guaranteed by fiduciary sale of non-residential property is not extinguished with the foreclosure of the guarantee. Once the property is consolidated in the name of the fiduciary creditor, the auction of the property will be promoted within 60 days. The existence of real rights of guarantee, or any encumbrances and unavailability of any kind on the real acqui - sition rights of the grantor, do not prevent the
consolidation of the real property and the sale of the real property. In this case, the holders of real rights are subrogated to the grantor’s right to receive the balance that may remain from the proceeds of the sale. The deadline for holding the public auction for the sale of the real property has doubled: it is now 60 days from the consolidation of owner - ship. The mortgage, in turn, also included changes in the aforementioned law. It can now be execut - ed out-of-court through two auctions, with the debtor or the mortgage guarantor being granted the right to redeem the execution by paying the entire debt, plus the expenses of the collection and auction procedures, within three days. Default on the obligation guaranteed by the mortgage allows the creditor to declare due the other obligations they hold guaranteed by the same property. Finally, it is worth noting that the mortgage and fiduciary sale may be extended to guarantee new obligations in favour of the same creditor – in the case of fiduciary sale, provided that there is no obligation contracted with a different credi - tor guaranteed by the same property – so that if the creditor pays the debts guaranteed by the mortgages or fiduciary sales earlier, they will be subrogated to their rights.
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