Giving in Payment of a Mortgaged Property (Dare în plată): Conditions, Effects and Practical Pitfalls

1. What is “dare în plată” and why was it introduced?

In civil law, “giving in payment” is a way of extinguishing obligations whereby the creditor accepts a different performance than originally agreed (for example, a property instead of cash payments of the loan). Romanian Law no. 77/2016 takes this general mechanism and turns it into a special consumer-protection scheme for mortgage loans: if the statutory conditions are met and a situation of imprevision exists, the consumer may request to extinguish the mortgage debt by transferring the mortgaged property to the creditor.

Article 1 of Law no. 77/2016 states that it applies to legal relationships between consumers and credit institutions, non-bank financial institutions or assignees of receivables against consumers. This means that the mechanism is only available to natural persons acting as consumers, not to professionals or companies, and only in relation to credit agreements secured with at least one residential property.

Shortly after its adoption in 2016, Law no. 77/2016 triggered intense litigation and several constitutional challenges. In its landmark Decision no. 623/2016, the Constitutional Court held that the law must be applied through the lens of imprevision, meaning that courts must verify, on a case-by-case basis, whether there has been a fundamental and unforeseeable change of circumstances that makes performance excessively burdensome for the debtor.

2. Legal framework and evolution of giving in payment

The core of the legal framework is Law no. 77/2016, which derogates from the general rules of the Civil Code and sets up a specific mechanism for extinguishing mortgage loans through transfer of the mortgaged property. The law has been amended and supplemented by Law no. 52/2020, which introduced more detailed provisions on imprevision and clarified procedural aspects such as the effects of the notification and the suspension of enforcement procedures.

The consolidated text of the law can be consulted on official and specialist platforms such as the Official Legislative Portal, LegeAZ or DreptOnline, which reproduce the updated wording of articles 1–13 together with references to Constitutional Court decisions.

The Constitutional Court has played a central role in shaping the mechanism:

• Decision no. 623/2016 confirmed the constitutionality of the law in principle but required courts to apply it through judicial imprevision, rejecting any automatic or purely legislative presumption of hardship.
• Later decisions, such as Decision no. 432/2021, examined the amendments introduced by Law no. 52/2020 (including the provisions on presumed imprevision) and emphasised again that the existence of imprevision must be assessed by the court in each concrete case, with the creditor having the possibility to rebut legal presumptions.

The High Court of Cassation and Justice (ICCJ) has also clarified the law’s application through preliminary rulings and decisions for the clarification of legal issues. A particularly important one is Decision no. 7/2019 of the ICCJ, which interpreted article 8(5) and confirmed that debtors who have already lost the mortgaged property through enforcement can still seek to extinguish the residual debt, subject to the conditions of the law and imprevision.

More recently, the ICCJ issued Decision no. 142/2025, which interprets article 8(5) first sentence and article 11 of Law no. 77/2016, clarifying in what circumstances courts may adapt a mortgage contract instead of ordering transfer of the property, in line with the Civil Code rules on imprevision.

3. Who can use giving in payment: eligibility conditions

Article 4 of Law no. 77/2016 sets out the cumulative conditions that must be met in order to extinguish the loan through giving in payment. These conditions concern both the person of the debtor and the characteristics of the loan and the mortgaged property.

3.1. Conditions regarding the debtor

First, the debtor must be a consumer. According to article 1 of Law no. 77/2016, read together with the definitions in Government Ordinance no. 21/1992 on consumer protection and Law no. 193/2000 on unfair terms in consumer contracts, a consumer is a natural person acting for purposes outside their trade, business or profession. Loans taken for investment or professional purposes (for example, to finance a development project) fall outside the scope of the law.

Article 4(1)(d) also requires that the debtor has not been convicted, by a final criminal judgment, for offences related to the loan in question (for example, fraudulently obtaining the loan), a condition reflected in the consolidated versions of Law no. 77/2016 on specialist portals. This is intended to protect only good-faith consumers and to prevent abuse of the mechanism by those who committed criminal acts linked to the credit.

3.2. Conditions regarding the loan and the mortgaged property

Article 4(1)(b) introduces a value cap: the amount borrowed at the time the credit was granted must not exceed the RON equivalent of EUR 250,000 at the exchange rate of the National Bank of Romania on the date of the contract. The cap is intended to target typical consumer mortgages rather than high-value loans. The condition is clearly set out in the text of article 4, as reproduced on the Official Legislative Portal and in consolidated versions of the law.

Another key condition, in article 4(1)(c), is that the loan was granted either for acquiring, building, extending, refurbishing or improving a residential property, or at least that it is secured by a mortgage over a property with residential use. The emphasis is on the use of the mortgaged property as a dwelling, not necessarily on the original contractual purpose, which has been confirmed in commentaries and case law dealing with investment-type loans later secured with residential properties.

3.3. The requirement of imprevision

After the 2016 Constitutional Court decision, imprevision became the central legal filter for applying Law no. 77/2016. In Decision no. 623/2016, the Court held that giving in payment is compatible with the Constitution only if courts verify whether the contractual balance has been fundamentally disrupted by extraordinary and unforeseeable events, making performance excessively burdensome for the consumer. The Civil Code’s general rules on imprevision (article 1,271) therefore apply, and the law cannot be used as an automatic escape from any unfavourable loan.

Law no. 52/2020 inserted new paragraphs in article 4 (in particular article 4(1¹)–(1³)), detailing situations in which imprevision is presumed – for example, substantial increases in the foreign-currency exchange rate or in the overall burden of the loan, or significant decreases in the debtor’s income. Legal analysis on these amendments, such as the article on “cases of imprevision in the giving in payment procedure” published by law firms, underline that these are rebuttable presumptions: creditors can prove that, in the concrete case, circumstances do not amount to true imprevision.

In Decision no. 432/2021, the Constitutional Court examined these new provisions and confirmed that they do not, in themselves, breach the Constitution, provided that courts continue to assess the existence of imprevision on a case-by-case basis and that legal presumptions do not become absolute. In practical terms, judges look at the debtor’s overall financial situation, the evolution of the exchange rate, the value of the property and the behaviour of both parties.

3.4. Loans excluded from giving in payment (e.g. “Prima casă / Noua casă”)

Article 1(4) of Law no. 77/2016 expressly excludes loans granted under the former governmental programme “Prima casă” (now “Noua casă”). This exclusion is clearly indicated in the official and consolidated texts of the law and has been repeatedly confirmed in legal commentaries. Debtors under these state-supported schemes must therefore use alternative tools (for example, renegotiations, hardship claims or actions based on unfair terms) and cannot rely on Law no. 77/2016 to extinguish the loan by giving the property in payment.

Moreover, loans without any immovable security, revolving credit facilities and credit card debts fall outside the mechanism, because Law no. 77/2016 is built around the transfer of a mortgaged immovable property. The requirement that at least one property be encumbered by a mortgage and used as a dwelling is a structural condition of the law, as emphasised in doctrine and case law.

4. When can giving in payment be invoked: before, during and after enforcement

One of the particularities of Law no. 77/2016 is that it may be used at different stages of the debtor–creditor relationship:

• Before any enforcement: when the debtor foresees that they can no longer honour the loan or is already in arrears but no enforcement has began;
• During enforcement: when enforcement has been initiated, whether by seizure of income, sale of the mortgaged property or other means;
• After enforcement: in situations where the mortgaged property has already been sold at auction, but the debtor continues to be pursued for the residual debt.

Article 8 of Law no. 77/2016 specifically regulates the latter scenario. The High Court’s Decision no. 7/2019 confirms that debtors who have already lost the mortgaged property through enforcement but are still subject to garnishments or other enforcement measures for the remaining debt can request the court to declare their obligations extinguished, as long as all conditions of Law no. 77/2016 and imprevision are met.

In addition, article 4(1³) of the law (introduced in 2020) presumes the existence of imprevision where the debtor has been subjected to enforcement of the mortgaged property and continues to be enforced for the residual debt. The High Court’s Decision no. 69/2021 discusses this presumption and the way in which it should be applied, highlighting that courts must still verify the overall circumstances and that the presumption is not absolute.

5. Procedure: from preliminary analysis to notarial deed or court judgment

5.1. Preliminary analysis and documents

Before starting the formal procedure, the debtor should carefully analyse whether the statutory conditions are realistically met. In practice, this involves gathering at least the following documents:

• the credit agreement and all addenda;
• the mortgage contract and any other security agreements;
• repayment schedules and bank statements showing the evolution of the loan;
• documents regarding income and its variation over time (salary certificates, tax returns, termination of employment, etc.);
• documents showing the evolution of the foreign-currency exchange rate (for foreign-currency loans) and, where relevant, valuations of the property.

These documents are important both for preparing the notification and for defending the debtor’s position in court in case the creditor challenges the giving in payment. Court decisions published on portals such as portal.just.ro or summarised on jurisprudenta.com show that courts place considerable weight on the concrete evidentiary picture when deciding whether imprevision exists.

5.2. The notification of giving in payment

The procedure formally begins with a notification of giving in payment sent to the creditor. Under article 5 of Law no. 77/2016, the notification must be transmitted through a bailiff, lawyer or notary public and must include, among other things:

• identification of the parties and of the credit agreement;
• identification of the mortgaged property that will be transferred;
• a clear statement that the consumer intends to extinguish the debt by giving the property in payment;
• the name of the notary public before whom the transfer deed will be concluded and two possible dates for the appointment.

Law no. 52/2020 amended article 5 so that the first date indicated for the notarial appointment cannot be less than 30 days and no more than 90 days from the date of the notification’s communication. During this interval, the law sets out important suspension effects, as explained below. Sample notifications, while not official, are publicly available on legal portals and are often used as starting points, although they must be adapted to each specific situation.

5.3. Effects of the notification: suspension of payments and enforcement

Articles 6 and 7 of Law no. 77/2016 regulate the immediate effects of the notification. In essence:

• Payments are suspended: from the moment the creditor receives the notification, any payments due under the credit agreement are suspended. The debtor no longer has to pay instalments during the procedure.
• Enforcement is suspended: any judicial or extrajudicial proceedings initiated by the creditor against the debtor are also suspended, including ongoing enforcement and garnishments.
• Protection extends to co-debtors and guarantors: article 6 stipulates that the creditor’s right to pursue co-debtors, co-payers or personal or mortgage guarantors is also suspended from the date of notification.

The combined reading of these provisions, as reflected in doctrinal commentaries and analysed in articles such as those published by Legal Land, confirms that the suspension is automatic and comprehensive, covering both the main debtor and associated persons, until the dispute triggered by the creditor’s challenge is finally resolved or the giving in payment is completed.

However, article 7(5) provides that if the court finally concludes that the conditions of the law are not met and dismisses the debtor’s request (or upholds the creditor’s challenge), and if the debtor acted in bad faith (for instance, by clearly abusing the mechanism without any real hardship), the creditor may claim damages and penalties. This risk underlines the importance of a realistic preliminary assessment.

5.4. The creditor’s challenge and the role of the court

Under article 7 of Law no. 77/2016, the creditor can file a challenge against the notification within the statutory time-limit. In that case, the court must examine:

• whether the formal and substantive conditions of article 4 are satisfied (consumer status, value cap, residential use of the property, absence of relevant criminal convictions, etc.);
• whether a situation of imprevision exists, in the sense developed by the Civil Code and by the Constitutional Court (notably Decision no. 623/2016).

In many cases, creditors argue that the debtor does not qualify as a consumer, that the value cap has been exceeded, that the property is not a dwelling or that no exceptional and unforeseeable change of circumstances has occurred. Debtors, on the other hand, typically invoke dramatic increases in foreign-currency exchange rates (especially in Swiss-franc loans), long-term income reductions, health problems or other events that substantially changed the economic balance of the contract.

The High Court’s case law, including Decision no. 7/2019 and Decision no. 69/2021, stresses that courts must apply the Constitutional Court’s guidance and verify whether the legal presumptions of imprevision correspond, in the particular case, to a genuine and serious imbalance of the contract, not just to general market fluctuations.

5.5. The notarial deed or court judgment of giving in payment

If the creditor does not challenge the notification within the time-limit, or if the court ultimately dismisses the challenge and confirms that the conditions of the law and imprevision are met, the procedure leads to the actual transfer of the property. This can occur in two main ways:

• Notarial deed of giving in payment: as envisaged by article 8(1), the parties sign an authentic deed before the notary indicated in the notification, by which ownership of the mortgaged property is transferred to the creditor in exchange for the extinguishment of the loan;
• Court judgment: if the creditor does not cooperate or refuses to sign, article 8 allows the debtor to ask the court to issue a judgment that both transfers the property and declares the obligations extinguished.

Article 10(1) of Law no. 77/2016 states that, once the deed or judgment is final, all obligations arising from the credit agreement are deemed extinguished, including accessories (interest, penalties, fees), and the mortgages are deleted from the land register. Specialist resources and case-law summaries emphasise that the giving in payment operates as a full discharge of the debtor with respect to that particular loan.

Notarial costs and professional fees (lawyers, bailiffs) are generally borne by the debtor, according to article 5(5). The specific amount depends on the property’s value and the notarial tariff, and should be discussed in advance with the notary.

6. Effects of giving in payment: debt, co-debtors, guarantors and tax treatment

6.1. Extinguishing the debt and cancelling the mortgage

The main legal effect of giving in payment is that the entire debt under the mortgage loan is extinguished. According to article 10(1) of Law no. 77/2016, the consumer’s obligations under the credit agreement, together with all related accessories, are considered fully discharged. This includes any residual debt that may have remained after an enforcement sale of the property.

In practice, once the notarial deed or court judgment becomes final, the creditor must take the necessary steps to delete the mortgage from the land register and update its internal records. Court decisions accessible through public databases show that, where creditors failed to comply, courts ordered them to request deletion of the mortgage and to recognise the extinguishment of the debt.

6.2. Effects on co-debtors and guarantors

Law no. 77/2016 explicitly protects not only the consumer–debtor but also co-debtors, co-payers and personal or mortgage guarantors. Under article 6, the creditor’s right to pursue them is suspended from the moment of the notification. Article 10(2) then provides that, upon completion of the giving in payment, all obligations of such persons arising from the loan are also extinguished.

This means that family members or friends who have guaranteed the loan, or co-debtors who signed the credit agreement, are released together with the main debtor, and the creditor can no longer pursue their income or assets for that particular debt. Court practice reported on portals such as jurisprudenta.com and legal blogs confirms that courts apply this extension of effects consistently.

6.3. Tax treatment: exemption for the first giving in payment

From a tax perspective, giving in payment is essentially a transfer of ownership of an immovable property and, in principle, would be subject to the real estate transfer tax owed by individuals, as regulated by the Fiscal Code. However, the legislator decided to avoid burdening over-indebted consumers with additional tax obligations when they are already in financial distress.

To this end, Government Emergency Ordinance no. 32/2016, which amended the Fiscal Code, introduced a specific rule: under article 111(2)(e) of the Fiscal Code (as amended), no tax is due on the first giving in payment performed in accordance with Law no. 77/2016, whether the transfer is made by notarial deed or by court judgment. Specialist tax commentaries explain that the exemption applies to one operation per person, and covers debtors, co-debtors and guarantors when their property is transferred in the context of giving in payment.

Articles available on tax-law portals and consumer-protection websites (for example, analyses on Fiscalitatea.ro or InfoCons) provide practical guidance: the exemption is recorded in a dedicated register, taxpayers can request reimbursement of tax already paid in certain cases, and the exemption does not apply to subsequent giving-in-payment operations by the same person.

Because tax rules are technical and may change, it is advisable for debtors considering giving in payment to check the latest version of the Fiscal Code and, if necessary, consult a notary or tax specialist regarding the exact impact in their situation.

7. Practical pitfalls and risks in using giving in payment

7.1. Failing to meet statutory conditions

A common reason why courts refuse to apply giving in payment is the failure to meet one or more of the cumulative conditions in article 4. Typical problems include:

• the loan amount, at the time of granting, exceeded the EUR 250,000 equivalent;
• the loan was taken for investment or professional purposes and the debtor does not qualify as a consumer;
• the mortgaged property is not a dwelling within the meaning of the law;
• there is a final criminal conviction related to the loan.

Case-law available on public portals shows that, in such situations, courts uphold creditors’ challenges and dismiss the consumer’s request. In addition, because the notification triggers automatic suspension of payments and enforcement, a failed attempt may lead to the resumption of enforcement with added delay, costs and potentially damages if bad faith is proven.

7.2. Confusing giving in payment with simple renegotiation

Another practical trap lies in treating giving in payment as a mere negotiation tactic with no real intention to give up the property. While the law does not prohibit parties from negotiating during the procedure, the Constitutional Court has stressed that Law no. 77/2016 must be applied within the framework of good-faith imprevision. Using the notification solely to gain leverage in negotiations, without a genuine situation of hardship, may be considered an abuse.

If courts find that the debtor clearly misused the procedure, article 7(5) allows the creditor to seek damages and penalties. Furthermore, even when imprevision is proven, article 1,271 of the Civil Code gives courts a range of tools: they may adapt the contract, distribute losses differently between the parties, or terminate the contract, not necessarily order a giving in payment. The High Court’s Decision no. 142/2025 clarifies how adaptation measures can be used in the context of article 8 and 11 of Law no. 77/2016.

7.3. Underestimating the impact of losing the home

Giving in payment almost always means losing ownership of the home. Even if, financially, this may appear rational when the outstanding debt far exceeds the property’s value or when income has permanently fallen, the social and psychological impact should not be underestimated. For many families, the home is more than a financial asset: it is a place of stability and emotional security.

Before choosing giving in payment, debtors should also consider alternatives such as:

• renegotiation or restructuring of the loan (for example, extending the term, temporarily reducing instalments);
• conversion of the loan into another currency and rebalancing the contract;
• voluntary sale of the property on the market, which may sometimes yield a better price than enforcement or giving in payment;
• actions based on unfair contract terms, where relevant, under Law no. 193/2000 and Directive 93/13/EEC.

7.4. Costs, duration and procedural uncertainty

The giving in payment procedure can be lengthy and costly, especially when contested by the creditor. Even though the law sets certain time-limits (for example, 30–90 days for the notarial appointment), litigation triggered by the challenge may take months or even years, depending on the complexity of the case, the number of appeals and the workload of the courts.

Costs may include professional fees (lawyers, bailiffs, notaries), court fees and expenses related to obtaining expert valuations or translations. While some of these costs are foreseeable, others may increase as the case becomes more complex. This is why many practitioners recommend a cost–benefit assessment before initiating the procedure, ideally with advice from a lawyer familiar with the case-law in the relevant court region.

7.5. Impact on credit history and future access to finance

Law no. 77/2016 does not regulate reporting to the Credit Bureau or to other credit registers. However, long periods of non-payment and enforcement, which often precede giving in payment, are usually reported and remain visible for several years. Publicly available information from the Credit Bureau and banks indicates that a negative repayment history can affect a consumer’s ability to obtain new loans, even if the previous debt has been extinguished through giving in payment.

In other words, while giving in payment may solve the immediate problem of an unsustainable mortgage, it may also have medium-term consequences for the debtor’s creditworthiness in the eyes of financial institutions.

8. Practical recommendations before opting for giving in payment

Given the complexity of the mechanism and its long-term impact, several practical recommendations can be drawn from the legal framework and case-law:

• Verify eligibility in detail: check the value of the initial loan in EUR, the nature of the property (residential or not), your consumer status and the absence of criminal convictions relating to the loan.
• Document the situation of imprevision: gather evidence of income reduction, job loss, health problems, exchange-rate evolution and any other factors that show a radical and unforeseeable change of circumstances.
• Analyse alternatives: talk to the bank about restructuring, consider selling the property yourself or exploring claims based on unfair terms, especially in foreign-currency loans with complex interest and fee structures.
• Seek professional advice: a lawyer with experience in giving in payment cases can help you evaluate whether the courts in your region have a restrictive or more open approach to imprevision and what your realistic chances are.
• Consider the broader impact: think about the consequences for co-debtors and guarantors, the impact on your family’s housing situation and the effect on your future access to credit.

Ultimately, giving in payment should usually be seen as a last resort tool, used when other reasonable options are no longer viable and when keeping the property is no longer realistic given the debtor’s sustainable income and family circumstances.

Frequently asked questions (FAQ) on giving in payment of a mortgaged property

Legal and reference sources

• Law no. 77/2016 on giving in payment (Official Legislative Portal)
• Law no. 52/2020 amending Law no. 77/2016
• Constitutional Court Decision no. 623/2016 (imprevision and Law no. 77/2016)
• Constitutional Court Decision no. 432/2021 (amendments introduced by Law no. 52/2020)
• High Court of Cassation and Justice, Decision no. 7/2019 (interpretation of article 8(5) of Law no. 77/2016)
• High Court of Cassation and Justice, Decision no. 69/2021 (imprevision in post-enforcement scenarios)
• High Court of Cassation and Justice, Decision no. 142/2025 (interpretation of article 8(5) first sentence and article 11 of Law no. 77/2016)
• Government Emergency Ordinance no. 32/2016 on fiscal measures (including tax exemption for giving in payment)
• Fiscal commentary on OUG no. 32/2016 and the first giving-in-payment tax exemption
• Doctrinal analysis of imprevision and the amendments introduced by Law no. 52/2020