Client Story: How Metzfund Saved a Forest Owner from Tax Debt
Selling forest is not always just an investment decision — sometimes it is the only way to resolve a serious financial situation. This client story is about Margus (name changed), who fell into serious difficulties due to business-related tax debt and found a solution through the sale of his mortgaged forest property. This is a true story that shows how a fast, professional approach helps in a crisis situation.
Key facts from the story
- Situation: entrepreneur with 48,000 EUR tax debt to the Tax and Customs Board
- Property: 35 ha forest land in Järvamaa, encumbered with a bank mortgage
- Solution: sale of the forest property to Metzfund
- Time taken: 3 weeks from first contact to receipt of funds
- Outcome: tax debt settled, remainder to the owner, mortgage discharged
Starting situation: how the problem arose
Margus was a small business owner working in construction. Several failed projects and unpaid invoices from clients led the company into payment difficulties. The accumulated tax debt to the Tax and Customs Board grew to 48,000 euros. The tax authority initiated enforcement proceedings and Margus faced a choice — either lose all assets through forced sale at a lower price, or quickly find a solution.
Margus had inherited a 35-hectare forest property in Järvamaa years earlier. The property was encumbered with a 25,000 EUR bank mortgage that Margus had taken out to finance his business. The forest was mature — predominantly 60-year-old spruce forest with good growing stock.
Timeline overview
| Day | Event | Outcome |
|---|---|---|
| Day 1 | Margus contacted Metzfund through the website | Valuation specialist responded within 2 hours |
| Day 2 | Metzfund specialist visited the property | On-site valuation and forest inspection |
| Day 3 | Metzfund submitted an official price offer | Offer: 92,000 EUR for the whole property |
| Days 4-5 | Margus considered the offer and compared with other buyers | Metzfund's offer was the best — other buyers needed more time |
| Day 6 | Margus accepted the offer | Metzfund's lawyer began preparing documents |
| Days 7-14 | Document preparation and communication with the bank | Mortgage discharge agreement with the bank, notary appointment booked |
| Day 15 | Notarised sale contract | Contract signed, Metzfund transferred funds to notary's escrow account |
| Days 16-18 | Land Register entry and settlements | 25,000 EUR to bank (mortgage), 48,000 EUR to Tax Authority (tax debt) |
| Day 19 | Remaining amount received by Margus | Margus received 19,000 EUR to his account (92,000 - 25,000 - 48,000) |
Challenges and solutions
The mortgage problem
The greatest challenge was the bank mortgage. Metzfund has experience in purchasing mortgaged properties. Our lawyer communicated directly with the bank and agreed that the mortgage would be discharged during the sale transaction — the bank's portion was paid directly from the notary's escrow account.
Time pressure
The tax authority's enforcement deadline was approaching rapidly. Metzfund's fast response time — a price offer within 24 hours and completing the transaction in 3 weeks — was the decisive factor. A typical forest transaction can take 1-3 months, but Metzfund's experienced team was able to accelerate the process.
Practical tip for those in a similar situation
If you have tax debt and forest land, do not wait for forced sale — the price obtained at forced sale is typically 30-50% below market value. Contact a buyer early. Metzfund responds quickly and is able to complete a transaction considerably faster than the standard process. The sooner you act, the better the outcome.
Margus's feedback
“I was in a very difficult situation and did not know where to turn. Working with Metzfund was fast and professional. They explained the whole process from start to finish, helped with communication with the bank and the Tax Authority, and did everything to ensure the transaction proceeded quickly. Without them I would have lost the property at forced sale for half the price.”
— Margus, Metzfund client
What to learn from this story?
- Do not wait until the last moment — the sooner you act, the more options you have
- A mortgage is not an obstacle — an experienced buyer can organise the purchase of a mortgaged property smoothly
- Forced sale is the worst option — proactive sale always gives a better price
- Seek professional help — Metzfund helps even in complex cases involving a bank, the Tax Authority, and a bailiff
- Forest land is a valuable asset — even in difficult situations, forest land can provide financial support
Metzfund services in complex situations
Metzfund also specialises in more complex transactions:
- Purchase of mortgaged properties
- Purchase of properties with tax debt
- Fast sale before enforcement proceedings
- Inherited properties and jointly-owned properties
- Organising communication with the bailiff and bank
Frequently asked questions
Does Metzfund buy mortgaged properties?
Yes, Metzfund has extensive experience in purchasing mortgaged properties. Our lawyers organise communication with the bank and mortgage discharge during the sale transaction. The owner does not need to negotiate with the bank themselves.
How quickly can Metzfund complete a transaction?
On an accelerated basis, we can complete a transaction in 2-3 weeks from first contact. A standard forest transaction takes 4-8 weeks. If you are under time pressure (enforcement, tax deadline), inform us immediately and we will prioritise your transaction.
Is the forced sale price really that much lower?
Yes, at forced sale (bailiff's auction), the asset price typically falls 30-50% below market value. The reason is simple — the pool of buyers at forced sale is more limited, time pressure is high, and buyers know they can negotiate. Voluntary sale always gives a better price.
Does Metzfund help with communication with the Tax Authority?
Metzfund is not a tax adviser, but our lawyers can help with structuring the transaction so that the tax debt is settled directly from the sale proceeds. We always recommend also consulting your accountant or tax adviser.