Art. 2703.Rights of Third Possessor

A third possessor is someone who bought mortgaged property without taking on personal responsibility for the debt the mortgage secures -- the buyer took the property subject to the mortgage rather than assuming it. Because this buyer never promised to pay the debt personally, the mortgaged property itself, not the buyer's personal assets, is what stands behind the creditor's claim, and Article 2703 gives the buyer a broader set of tools than Article 2702 gives a buyer who did assume the debt.

Once the property is seized and sale is imminent, the third possessor can pay the balance due -- principal, interest, attorney's fees, and costs -- to end the matter outright. The third possessor can also arrest the seizure and sale by injunction on any ground Article 2751 recognizes, plus two grounds unique to this position: that the mortgage or privilege was never recorded, or that the recorded inscription had perempted. Louisiana mortgage recordings lose their effect against third parties after a set period unless the creditor renews, or reinscribes, them in time; a lapsed inscription means the creditor's recorded security no longer reaches the property in the third possessor's hands.

Article 2703 also lets the third possessor intervene in the executory proceeding itself to claim credit for the enhanced value that improvements added to the property -- improvements the third possessor made, or that an earlier third possessor made before conveying the property onward. That intervention proceeds as a summary proceeding, started by a petition meeting Article 891's requirements, rather than through the injunction process used to arrest the sale outright.