Today, not every citizen can afford to buy an apartment. Real estate prices are high, but nevertheless, you need to live somewhere. Children sooner or later grow up and fly out of their parents' nest, starting their own families and children. Many people wonder how to buy housing in Moscow and where to get money. Today, the issue of buying an apartment with a mortgage encumbrance is a very pressing issue. It is worth remembering that drawing up such an agreement requires care and the provision of an additional package of documentation. But what does real estate encumbered with a mortgage mean?

What is real estate encumbered with a mortgage?

There are several types of encumbrances, but let's consider mortgage encumbrances. This means that the apartment was previously purchased on credit. For some personal reasons, the owner was unable to pay his debt and the only way out of the situation was to sell the apartment with a mortgage encumbrance to another individual. The bank must provide all the conditions for such a transaction.

Without these conditions being met, the sale of the apartment simply cannot take place. Most often, the financial institution issuing the loan will ask for 50% of the loan from the original owner.

Buying an apartment with a mortgage encumbrance: risks

1. Mortgage. It means that the housing was previously taken out by the current seller on credit, but the debtor was unable to cope with his debt obligations for a number of reasons. Therefore, the only possible solution to the difficult financial situation was to sell the apartment with an encumbrance to another individual. At the same time, the bank retains the right to provide conditions for the transaction, without which the purchase of the apartment will not take place. Most often, the lending institution requests that 50% of the mortgage loan be paid immediately by the original owner.
2. Rent - implies the inability of the rent payer to dispose of the real estate where the rent recipient currently lives. For this to become real, it is necessary to obtain written consent from the latter.
3. Seized apartment. If an apartment is purchased, this does not mean that the owner does not need to fulfill obligations regarding payment of utility bills. If the debt has accumulated on a particularly large scale, in order to remove the property from seizure, you will have to pay the money or at least agree with the utility company on monthly payments that will help pay off the debt over time.
4. Housing for rent. The owner can sell square meters, and the tenants have no right to interfere with the transaction, however, if the lease agreement concluded between the 2 parties to the transaction specifies a specific period, for example, 2 years, it is impossible to evict the tenants earlier. The buyer needs to be vigilant, otherwise he will have to share the house with unexpected neighbors.
5. Buying an apartment is possible if a person who is not the seller is registered in it. To save the new owner from unnecessary hassle, a citizen only needs to appear at the territorial branch of the passport office, but if he refuses to do this, then the owner has the right to go to court. When buying an apartment with an encumbrance as a registered individual, you should first determine whether the person registered does not belong to a category of the population that has a benefit when it is impossible to register him by law.
6. An apartment is considered an encumbrance if the house is considered unsafe. Selling real estate in such a building is illegal.
7. An easement on land is the right of third parties to use a plot of land that is not owned by right of ownership.

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What does such a purchase look like?

When buying an apartment, you need to follow the procedure. How to buy an apartment with a mortgage encumbrance? The first thing a buyer needs to do before purchasing real estate is obtain permission from the bank for the subsequent sale of the apartment. The financial institution that entered into the loan agreement has certain rights, especially if the other party cannot fully cope with its responsibilities.

The first thing you need to find out is how much the future owner will have to pay the bank for the purchase of square meters. If the size of the fee suits the potential client, then all the details and terms of the transaction should be discussed in more detail. The conditions can be very different, for example, a 50% contribution by the primary owner. If the primary owner does not have such an amount, then you can talk with him and provide this amount towards the purchased apartments. Only this agreement concerns only two people. The bank has nothing to do with this. With such agreements, the legal aspect very often suffers. To avoid this, the transaction should be concluded only in documents.

After all the conditions have been met, the new buyer and the lender need to draw up a new contract for the purchase of real estate, which will spell out all the nuances of repaying the loan. As soon as this paper is certified by a notary, the document comes into effect and has legal force. It is also necessary to draw up a deed of purchase and sale of real estate. After this, the bank transfers all documents to the new owner of the property.

The cost must necessarily be more than the cost of the mortgage, and the entire difference will be paid to the buyer after all activities have been completed.

Sometimes the new owner simply negotiates with the bank to re-register all documents in a new name. Not all organizations can make such a concession, especially if the client does not have a very good credit history.

Buyer's risks

Buying an apartment with a mortgage has some risks that everyone should be aware of. Such an operation is quite labor-intensive and contains many stages, so the risks are as follows:

1. The buyer may quickly die, and in this case it is simply impossible to get rid of the encumbrance. Money paid as collateral by the bank will not be returned. If a person simply disappeared, then collecting funds from him is also problematic.
2. The seller can refuse to carry out the transaction and all this after the deposit has been received. If the transfer of funds is not documented, then it will be extremely difficult to prove it in court.

Features of selling an apartment with an encumbrance in 2020

• Due to frequent changes in legislation, information sometimes becomes outdated faster than we can update it on the website.
• All cases are very individual and depend on many factors. Basic information does not guarantee a solution to your specific problems.

Purchasing an apartment with registered tenants for the buyer is fraught with problems with their registration. Registered residents who are not owners cannot apply for an apartment, but they have every right to live at their place of registration.

Problems you may encounter

Purchasing such real estate has a number of features. Such features can completely mislead the buyer. For example:

1. Paying the deposit twice. There are dishonest sellers who carry out various frauds to obtain collateral several times. Negotiations are ongoing with several apartment owners. It is also possible that the housing is already secured by another credit institution. In this case, you cannot get rid of the burden.
2. If the seller cannot pay his debt, then the property will most likely be foreclosed on. Therefore, before transferring money, you must obtain papers confirming the fact that the apartment is not under collateral.
3. You will have to pay not only the remaining debt, but also fines against the new buyer. A person learns about these fines already at the moment of concluding the transaction itself. This is done on purpose, because refusing to purchase at this moment is completely unprofitable, despite the fines imposed. Sometimes the funds will simply be withdrawn from the buyer's account. If the debt is too large, that is, the debt has not been repaid for a long period of time, then in this case the penalty will be fabulous.
4. In any case, if the seller goes to court or refuses the deal at the very last moment, then all costs and damages will be paid by the buyer of the property.

Double encumbrance on an apartment with a mortgage

The buyer often does not have enough funds to buy the entire apartment, but a mortgage is quite suitable for him. If the seller agrees with the bank, he can re-register the collateral. The credit institution does not always agree to this due to the buyer’s low income or bad credit history.

There is one interesting point that few people pay attention to: when property is transferred to another person, all encumbrances remain, that is, the debts must be paid by the current owner. It is for this simple reason that when making a transaction you should know whether everything is in order in this regard. If there is an encumbrance on the apartment, then this is a reason to think about it. Let's take a closer look.

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Checking the presence of an encumbrance

If a person is not very strong in law and does not have all the legal knowledge, then there is a risk that problematic housing may be purchased. Before purchasing, be sure to check the apartment for encumbrances, and this can be done quite simply. Absolutely all restrictions are included in the Unified State Register of Rights to Real Estate. You can contact the Rosreestr branch, but you can get the necessary information without leaving your home. To do this, you need to submit a request on the website rosreestr.ru. To obtain the required detailed statement, you will need to fill out the form provided and pay the state fee. All information is in paragraph 4 of the Unified State Register. If there are no encumbrances on the apartment, then the statement will simply say “not registered.” In any case, anyone can get the information they need.

Encumbrance - what is it? Removal of mortgage encumbrance

Also included in the section of control is arrest - this is a ban on concluding any contracts or transactions. In this case, as noted above, everything is decided by the court. Moreover, the owner of, for example, a seized house must keep it safe until a court decision is made.

I would also like to say that there are situations when citizens who are registered there live in an apartment, but are not its owners. It is not recommended to purchase such property, because, as practice shows, tenants are not evicted immediately, and then they have to achieve this through the courts. If incapacitated or minor citizens live in the apartment, then you need to contact the guardianship authorities, since it will be impossible to carry out the transaction without their consent. It is very risky to purchase property using rent, since such agreements are sometimes ambiguous and contain a lot of small nuances. It is recommended to first find out how to remove the encumbrance, and only then buy or sell housing.

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Is encumbrance bad or good?

Having checked the apartment for encumbrances before purchasing, you should not immediately abandon it if this fact exists. Typically, purchasing such an apartment costs the buyer much less, and good money can be saved. In order to avoid all possible risks, it is recommended to ask for help from a professional realtor.

The transactions of purchasing real estate with an encumbrance are quite complex, so you only need to contact an experienced realtor. Undoubtedly, you will need to pay, but this way everyone can protect themselves. It is not recommended to carry out such transactions on your own. The only exception is if the buyer is well versed in this area. Purchasing such apartments can bring significant benefits. The presence of problems with the apartment forces the seller to reduce the price. Anyone can buy such apartments for 40% of the market value.

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Apartments with encumbrances: to buy or not

Transactions with encumbered real estate are quite complex, so it is better to use the services of an experienced realtor with extensive knowledge in this area. Of course, this will affect the size of his fee, but everyone knows the proverb: “the miser pays twice.”

Therefore, the buyer of an apartment must carefully check all documents for the apartment and its history. It is especially necessary to check the presence of encumbrances on the apartment, that is, any obligations of the apartment seller to organizations or individuals who, as a result, can claim their rights to the apartment you are purchasing.