Short answer. Yes. Article 2127 extends the mortgage to the natural accessions and to the improvements, and it does so whether the estate remains with the mortgagor or passes into the hands of a third person. Growing fruits, unreceived rents and certain indemnities are covered as well.

What the law says

The mortgage extends to the natural accessions, to the improvements, growing fruits, and the rents or income not yet received when the obligation becomes due, and to the amount of the indemnity granted or owing to the proprietor from the insurers of the property mortgaged, or in virtue of expropriation for public use

Civil Code, Article 2127 — Extent of the Mortgage. Read the full provision →

The security follows the land upward

Article 2127 provides that The mortgage extends to the natural accessions, to the improvements, growing fruits, and the rents or income not yet received when the obligation becomes due, and to the amount of the indemnity granted or owing to the proprietor from the insurers of the property mortgaged, or in virtue of expropriation for public use. A house built on mortgaged land after the deed was signed is an improvement, and it is covered. Owners are often surprised by this, having assumed that the bank's security was fixed at what stood on the lot the day they signed.

More than buildings

The article sweeps in several things that are not structures at all. Growing fruits and rents or income not yet received when the obligation becomes due are within it, so a mortgaged property that is generating money is generating it against a security interest. So are indemnities: proceeds owing from the insurers of the mortgaged property, and compensation for expropriation for public use. That last pair matters after a fire or a road-widening, because the money that replaces the property stands in its place rather than falling free of the mortgage into the owner's hands.

And it follows the land into other hands

The extension applies whether the estate remains in the possession of the mortgagor or passes into the hands of a third person. Article 2126 states the same principle directly: the mortgage subjects the property upon which it is imposed, whoever the possessor may be, to the fulfilment of the obligation for whose security it was constituted. So selling the property does not shake off the encumbrance, and a buyer takes it subject to the registered mortgage. Article 2130 confirms the other side of that arrangement, voiding a stipulation that forbids the owner from alienating the mortgaged immovable.

What this means before you build

If you are putting up a structure on land already mortgaged, understand that you are enlarging the creditor's security rather than creating something separate. Check the mortgage deed for what it says about improvements and insurance, since the article's terms are subject to the declarations, amplifications and limitations established by law and the deed may add its own requirements. Note as well that Article 2088 prohibits the creditor from appropriating the property or disposing of it, and voids any stipulation to the contrary, so a wider security is not a shortcut to ownership.

Cases citing this provision

These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.

Related provisions

Note. Statute text quoted on this page is reproduced from the official enactment and is linked to the full provision. The explanation around it is general legal information from Vivas & Nobles Law Office, not legal advice. Whether it applies to your situation depends on facts only a lawyer reviewing them can assess.