Two German real estate terms

One of my students has the terms "Grundschuld" and "Hypothek" and has them translated as "Land charge" and "Mortgage" respectively. He's not really happy with the term land charge, as no one seems to know it. Do people know it and are aware of what it means? Or is he better off using mortgage and explaining the difference to his English speaking clients?

Are you sure he doesn't mean Grundsteuer, which translates to Stamp Duty in Britain.

edit: actually I think Grundschuld is Stamp duty, Grundsteuer is more rates.
Just checked this again and I'm wrong, So ignore this!

the way i understand it the Hypotheke is the mortgage itself whereas the "Grundschuld" is the right of the mortgage lender to demand payment of the monthly rates of the mortgage. basically it is something along the lines of a "security" ie the property itself is the security for the mortgage. or summit like that.

The forums on Leo seemed happy with 'land charge' for Grundschuld, and there's plenty of hits on Google for it, but I don't actually have a clue myself. My brother's in the property business so I could ask him, but that won't be until tomorrow.

The Grundschuld is entered in the Grundbuch and details the amount you owe on the day the property is transferred into your name - but to be honest I don't really know what it means or what relevance it has.

Land charge doesn't really mean anything to me. I'd be tempted to go for something using property rather than land - but I think he'll have to explain the difference anyway.

I wouldn't know what "land charge" is supposed to mean (if anything, I'd think it was a tax of some sort, like council tax in England, for example).

If Grundschuld denotes a financial claim on the property, I think "encumbrance" or "lien" could be used (both concepts are broader than mortgage, if I'm not mistaken).

STB, if you can ask your bro, that would be cool. There's no immediate rush.

But it would be good to have something to tell him by Friday morning...

Grundschuld is the outstanding balance of what you owe. Basically it is the principle of the mortgage. Hypothek is a little more complicated. It isn't really the mortgage at all and has more to do with the rights of the purchaser or the holder of the loan. A Hypotheken Bank (like a mortgage bank) doesn't really own the Grundschuld (mortgage), but owns the rights until it is paid. The grundschuld is the responsibility of the buyer and the rights are basically the collateral that the mortgage bank takes in order for you to secure the loan. Complicated isn't it.

I'm afraid I disagree. I also believe it is essentially the charge on the land or property. In essence the value of the security (usually owned by the bank) on the total asset. The Hypothek is the mortgage, and therefore the agreement with the bank to loan you money to pay off the charge. Thae value of the Hypothek will decrease (assuming it's a repayment mortgage), whereas the Grundschuld remains static (which is why it can't be the "outstanding balance of what you owe" as this will slowly reduce, unless you apply to re-evaluate to comply with the capital outstanding or re-mortgage). If anyone buys your property, then the company registered with the Grundschuld has first grabs on any payment potentially upto the Grundschuld value (but usually less as part of the mortgage is paid off) before you get any money.

@Allershausen - Grundsteuer is NOT Stamp Duty, that's Grunderwerbsteuer (currently 3.5% of the purchase price payable on purchase), Grundsteuer is a recurring (quarterly or annual) tax payable by a property owner to the local council. Nearest UK equivalent would be "rates" or even "Poll Tax"!