Fatemeh Rakideh
trainee lawyer at the Iranian Central Bar Association
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Release of mortgage and return of the title document

Release of mortgage and return of the title document

Discharging a mortgage releases the secured property from the mortgage. In a property transaction, the seller may have undertaken to pay the bank debt or mortgagee’s claim and free the property for formal transfer, but then refuse to perform.

Before filing, identify the mortgagor and mortgagee, the amount and status of the debt, who undertook to discharge the mortgage and whether formal transfer of title should also be sought.

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What are release of mortgage and return of the title document?

A rahn (pledge or mortgage) is a contract under which a debtor gives an asset to a creditor as security for a debt. Under Articles 771 et seq. of the Iranian Civil Code, the mortgaged asset secures the debt and acts inconsistent with the mortgagee’s rights are restricted. After payment of the debt or another legal ground arises, release of the security and discharge of the mortgage may be sought.

Statutory basis: Article 793 of the Iranian Civil Code restricts dealings inconsistent with the mortgagee’s rights. Formal transfer of mortgaged property therefore often requires those rights to be addressed.

Who must arrange the release of mortgage?

The answer depends on the contract and debtor–creditor relationship. The seller may owe the bank debt, the buyer may pay part of the price directly to the mortgagee, or a third party may be the mortgagor. Identify the defendants in light of those relationships.

Release of mortgage and return of the title document

Usual stages of review and follow-up

Reviewing the instrument and contract

The mortgage, seller’s obligations and payment terms are reviewed.

Obtaining a statement of the outstanding debt

The status of the debt and the conditions of the mortgagee or bank are determined.

Claim for performance of an obligation

A formal legal notice or an action to require discharge of the mortgage and, if necessary, execution of the official deed may be pursued.

Removal of the encumbrance and transfer

After the settlement or execution of the judgment, the mortgage is removed and the document is released.

Connection with execution of an official title deed

If the ultimate objective is transfer of the property, merely discharging the mortgage may not be sufficient; it may also be necessary to seek an order compelling execution of an official deed. In some cases the mortgagee or bank must be joined for the judgment to be enforceable.

Related topics

Iranian property disputes

Return to the comprehensive property-law services page

action to compel execution of an official title deed

Official transfer of property and removal of registration obstacles

action to recover possession based on established ownership (khalʿ-e yad)

Ending unauthorized possession on the basis of established ownership

  • Iranian Civil Code («قانون مدنی»)

  • Iranian Registration of Deeds and Properties Act («قانون ثبت اسناد و املاک»)

  • Iranian Code of Civil Procedure («قانون آیین دادرسی دادگاه‌های عمومی و انقلاب در امور مدنی»)

This list identifies the principal legal provisions relevant to the page. The applicable law and amendments must be checked against the dates, subject matter and circumstances of each case.

The official texts and latest amendments are available in the National Database of Iranian Laws and Regulations.

Frequently asked questions

The claimant must prove ownership in an admissible manner. For registered property, the official title deed plays a central role.
An ownership-based recovery claim (khalʿ-e yad) is brought against a person possessing property without authority. Tenant eviction usually concerns possession initially authorised by a contract, such as a lease, which later continues without authority.
In an ownership-based action to recover property, proof of ownership is central. In a civil unlawful-dispossession claim, the claimant’s prior possession, the defendant’s later possession, and the unlawful nature of that later possession are material.
A co-owner’s possession of jointly owned property is subject to special rules. The possibility of bringing an action and the manner of enforcing the judgment must be examined in light of the undivided share, the other co-owners’ consent, and the nature of the possession.
Where the requirements are met, compensation for the period of occupation may be claimed with the possession claim or separately. Assessment of that compensation usually requires an expert opinion.
Because the dispute concerns immovable property, jurisdiction generally lies with the court where the property is located. The precise position depends on the circumstances and relief sought.
The financing agreement, outstanding debt, the responsible person’s obligation and the bank’s conditions must first be reviewed. Discharge of the mortgage may follow settlement, performance of an obligation or, if the obligor refuses, legal action.
If the seller undertook to transfer the property free of a mortgage, review the contract and the debt’s status. Where appropriate, an order compelling discharge of the mortgage may be sought alongside relief concerning formal transfer of title.

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