Can mortgaged property be sold?

Art. 373
Civil Code
Art. 375
Civil Code
No consent if f
Condition
Mortgage surviv
Effect
The Short Answer

Yes, mortgaged property in Japan can be sold, but the mortgagee’s consent is generally required unless the sale proceeds fully repay the secured debt.

What the Law Says

Japanese law permits the sale of mortgaged property, but the mortgage right remains attached to the property unless extinguished by full repayment or agreement.

Under the Japanese Civil Code, a mortgage is a security interest that follows the property (‘real’ or ‘in rem’ right), not the debtor personally. This means the mortgage continues to exist even if ownership changes.

Article 373 states that 'a mortgagee has the right to be paid out of the proceeds of the sale of the mortgaged property before other creditors.' This confirms the mortgagee’s priority claim on sale proceeds.

Article 375 provides that 'the mortgage right continues to exist even if the ownership of the mortgaged property is transferred to a third party,' unless the mortgagee consents to its release or the debt is fully discharged.

Statutory Text

A mortgagee has the right to be paid out of the proceeds of the sale of the mortgaged property before other creditors.

— Civil Code, Art. 373 — Priority of Mortgagee
Statutory Text

The mortgage right continues to exist even if the ownership of the mortgaged property is transferred to a third party.

— Civil Code, Art. 375 — Continuation of Mortgage Right

What to Do

1

Confirm whether the mortgage agreement requires the mortgagee’s prior written consent for sale.

2

Ensure the sale proceeds are sufficient to fully repay the secured debt — otherwise, the mortgage remains enforceable against the buyer.

3

Obtain a formal release (‘kaijo shomeisho’) from the mortgagee if seeking to extinguish the mortgage upon sale.

4

Register the transfer of ownership and any mortgage release at the Legal Affairs Bureau.

Sources

statuteCivil Code, Art. 373 — Priority of MortgageestatuteCivil Code, Art. 375 — Continuation of Mortgage Right

Not legal advice. This article is general information based on publicly available sources, written for educational purposes. Laws change and individual situations vary. Consult a licensed attorney in your jurisdiction before acting on anything you read here. Last reviewed: 2026-06-09.