How can you remove a mortgage encumbrance by force of law in 2020?

What is a mortgage by law?

The word “mortgage” itself means the purchase of real estate as collateral for real estate - either the one that was purchased as a result of receiving a loan, or the one that the borrower owned before contacting the bank.

Buying real estate is, first of all, a transfer of ownership rights, registered in Rosreestr. When a new right arises (the owner of the property changes), then the transaction is considered completed. But the order in which property rights are transferred and what is pledged is the answer to the question of what a mortgage means by force of law.

In simple terms, a mortgage, by virtue of the law according to the Civil Code of the Russian Federation, is a transfer of ownership rights to real estate as a result of receiving a loan from a bank . That is, the bank issued a loan and the money was used to buy housing.

Legally, this means that registration of a new home owner is carried out in accordance with Article 77 of the Federal Law of July 16, 1998 No. 102-FZ “On Mortgage (Pledge of Real Estate" or Article 488, paragraph 5, Article 587, paragraph 1 of the Civil Code Russian Federation.

A transaction by force of law is not only the most common scheme of action among all banking organizations in Russia, but also the safest and legally verified.

As a rule, by default, a transaction for the purchase and sale of housing through a bank is carried out precisely according to the “by force of law” format.

Mortgage by force of law and by force of contract: differences

A negotiated mortgage is a transaction with more flexible conditions; the lender and the borrower can deviate from the framework of the law and draw up individual terms of cooperation. But this type of lending is rarely used, since it carries risks for the lender himself. In fact, in the market, a mortgage loan by virtue of an agreement is issued almost only when applying for a non-targeted loan secured by property or when applying for a mortgage secured by property that is already owned by the borrower.

What is the difference between a mortgage and a mortgage by force of law:

1. Under a mortgage, by force of law, a transaction is concluded only with the use of collateral of the acquired property.
2. Registration of a legal mortgage and settlement with the seller occur at the moment when the purchase and sale agreement is registered, that is, everything is done at the same time. In the case of a negotiated housing loan, the bank first issues money to the seller, then a purchase and sale transaction is drawn up, and only after that an encumbrance can be imposed: precisely because the transaction is unprotected for some time, banks take risks, and this may affect the rates.
3. Registration of a mortgage is free of charge by law. Upon contractual registration, payment of a fee will be required; for individual borrowers this is 1000 rubles. If the borrower is a legal entity, it will pay 4,000 rubles.

In both cases, anyone can act as a lender and borrower: citizens, organizations (not necessarily financial). A mortgage between individuals is not excluded by force of law.

When does such a mortgage arise?

A mortgage, by operation of law, occurs when an individual obtains title to any real property as a result of the signing and execution of a contract of sale, rent, exchange, or any other agreement where borrowed money is used. It follows from this that the transaction becomes completed after registration with Rosreestr, but not before this stage.

In general, the term “mortgage by force of law” is rarely used, because its main purpose is to secure encumbrances on certain real estate. This concept is mainly used by Rosreestr employees, and less often by bank employees.

Depending on which method of obtaining a mortgage was chosen, a specific piece of real estate is established, on which an encumbrance (collateral obligation) is then placed.

We understand the differences between a mortgage by force of law and an encumbrance by force of contract

Re: Pledge by force of law A pledge by force of law arises if the apartment is transferred and the money has not yet been paid. If the contract states that the parties have agreed that a pledge does not arise, then it is not registered. Shmack Local Messages: 470 Re: Pledge by force of law Quote: Message from Non-Residential Fund - will not register Quote: Message from Shmack Pledge by force of law arises if the apartment is transferred and the money has not yet been paid. great, almost calmed down! I thought so too, but something was confusing... thank you) that is, we calmly write all of the above, we sign the deed of payment, but we don’t give it to Rosreestr, and in the contract we write that the deed of payment is signed after registering the transfer of rights and then there will be no collateral , I understand everything so well?) Exacerbation Local Messages: 577 Re: Pledge by force of law Quote: Message from Exacerbation we sign the deed of payment Sign the deed when you actually transfer the apartment. Mortgage Law); – when transferring a plot of land or other real estate for payment of rent, the recipient of the rent, as security for the obligation of the rent payer, acquires the right of pledge over this property (clause 1 of Article 587 of the Civil Code of the Russian Federation); – a mortgage by force of law arises if a property is purchased on credit or in installments (Articles 488 and 489 of the Civil Code of the Russian Federation); – a land plot owned by the developer (right of lease or sublease), and an apartment building and (or) other real estate object being built (created) on this land plot to ensure the fulfillment of the obligations of the developer (mortgagor) under the agreement from the moment of state registration of the agreement are considered pledged by participants in shared construction (mortgagors).

What properties does it apply to?

Such a mortgage can be issued for:

• A residential property in exploitable condition - a house or apartment - purchased partially or fully with loan funds from the bank;
• Any product, including commercial and residential real estate (it does not matter what operating status the product has), for which an installment plan or loan was issued. Such goods remain pledged to the seller until the last payment for the property is made;
• Any piece of real property obtained as a result of the execution of a rental agreement.

But it is no longer possible to obtain a mortgage for the following types of real estate by virtue of the law :

• If housing or real estate cannot be privatized - or, conversely, are subject to mandatory privatization by law;
• If the objects were withdrawn from circulation (excluded from the list of operating buildings due to emergency conditions or other reasons);
• If an object of real estate cannot be recovered in any way due to the restrictions in force in relation to it.

Pledge by force of law in Rosreestr, what does it mean?

I want to buy an apartment, I took an extract from the registry, and it says that there is a restriction on the deposit by force of law. What does this mean? Sincerely, Zhemkov Andrey Alexandrovich. E-Mail: zhemkovandrey mail. N Federal Law from

This means that at any time the mortgagee can come and foreclose on the specified apartment. And please note that in the event of a transfer of ownership of the pledged property as a result of paid or gratuitous alienation of this property or in the manner of universal legal succession, the right of pledge remains in force under Art. Good afternoon Alexander! This wording in the statement indicates that the apartment is pledged to a third party, most likely a bank. Probably the seller once bought an apartment with a mortgage or has a loan secured by real estate.

How is it different from a contractual mortgage?

Let us now understand where the line lies and what the main differences between a mortgage by force of law and by force of contract are expressed.

A mortgage loan by virtue of an agreement means a type of encumbrance that is not fully regulated by legislative acts. This most often happens in atypical situations when it is necessary to introduce many conditions, reservations, mutual requirements, etc. into the rights registration procedure.

Relatively speaking, a mortgage by force of law is when everything is extremely simple and all parties to the transaction act according to a scheme pre-established by law, but the same by force of contract is when the classical scheme is not suitable for a very unique case.

The basis for such a mortgage is a certain document establishing all the rights and obligations of the parties. Most often this is a purchase and sale agreement, but there may be variations. For example, a mortgage loan by virtue of an agreement is almost always concluded in the following cases :

• When the borrower places an encumbrance not on the property purchased on loan, but on housing that was owned by the citizen even before contacting the bank;
• When the transaction involves several parties that are not typical for lending - for example, the state partially subsidizes the purchase of housing (maternity capital, etc.);
• If the transfer of property rights must occur upon fulfillment of a certain condition - for example, the privatization of housing;
• The same thing, only with regard to the transfer of funds (down payment, first payment, full payment, etc., depending on the chosen loan/installment plan format).

Mortgage by agreement

If the lender uses this type of transaction execution, it means that the relationship between the borrower and the lender will be regulated by a separate agreement, and not by Federal Laws. In essence, a contractual mortgage involves the issuance of a loan on any terms; the parties to the transaction can indicate in the agreement any points that are not regulated by law, which are impossible in the case of a mortgage loan by virtue of the law.

Features of this type of mortgage:

1. The transaction is not necessarily secured by collateral of the purchased property. If you plan to take out a mortgage secured by the property you already own, in this case it will be a mortgage that will be issued by virtue of an agreement. When registering the transaction, you will immediately receive full ownership rights to the purchased property, which is impossible with a loan by force of law.
2. This is not necessarily a targeted loan. If you plan to get a cash loan secured by a real estate property you own, the agreement will also govern the transaction. Such transactions also apply to mortgage transactions.

What is best for the borrower?

It cannot be summed up unequivocally that one format brings more benefits to the borrower, and another less. It all depends on the situation.

A mortgage loan is legally convenient and beneficial to all parties to the transaction if everything goes “on the beaten path,” i.e. there are no conditions and requirements, only upon the occurrence of which registration or transfer of funds must occur, there are no additional parties to the transaction, or any other difficulties.

When everything is standard - a loan is received, a down payment is made and property rights are immediately registered - there is nothing better than a mortgage by force of law, because it gives the greatest legal protection to both the bank, the seller, and the buyer.

But these advantages become irrelevant as soon as nuances appear in the transaction that are not regulated by the standard package of legal documents. Then, on the contrary, it is the mortgage loan that, by virtue of the contract, can provide the greatest protection to both the borrower and the other parties, because the agreement will further clarify and legitimize those very nuances not regulated by law.

What does a pledge mean by force of law on the Rosreestr website?

Today we’ll talk about what a mortgage is by force of law. Many people associate the term mortgage exclusively with the procedure for obtaining housing on credit, but it is a common misconception. A mortgage is a pledge of real estate, which will be encumbered under a loan agreement, installment plan or other obligations provided for by law. There are two concepts - mortgage by force of law and mortgage by force of contract; the features and differences of these types of transactions will be discussed further.

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The procedure for registering a mortgage by force of law

This happens in several stages:

• Registration of a loan and purchase and sale agreement;
• A package of documents is being prepared for submission to Rosreestr. The papers must include a receipt for payment of the state duty;
• After contacting Rosreestr to submit documents and an application, no more than five days will pass - during this period you will either be asked to supplement or adjust the package of documents, or registration and encumbrance will already be issued;
• Finally, the apartment will become yours along with the removal of the encumbrance, and this will happen only after full payment of the debt.

What is the difference between a mortgage by law and a mortgage by contract?

Photo: https://pixabay.com/photos/contract-consultation-office-408216/
A legal mortgage is always a targeted loan issued exclusively for the purchase of housing. But there are also consumer loans, when you can get a large amount and use it as you wish - buy an apartment, transport, go on vacation, spend it on treatment or education, or distribute it to the poor. In this case, the money is issued against the property the person already owns.

Such a transaction is called a mortgage by contract, which arises as a result of a contractual agreement between the borrower and the lender.

The main differences are presented in the table.

Termination of mortgage by operation of law

In essence, termination of a mortgage is the cancellation of an encumbrance. From this moment on, the bank will no longer have any rights to your property, even if it has any claims. But the question of how to remove the encumbrance is another matter.

First of all, you need to remember that termination of a mortgage is impossible without full satisfaction of the lender's requirements . This means that the debt must be fully repaid without any balance and without claims from the bank. If the debt is simply transferred to a third party by assignment of the rights of claim, then the encumbrance is not removed - it will simply be re-registered to the person who received the debt from the original creditor.

As soon as everything is over with the debt, you need to get a certificate from the bank office about the absence of debt and claims. You must come to the Rosreestr branch with this paper, as well as a payment schedule to the bank, a loan agreement and other documents. There the papers will be checked and if everything is in order, the encumbrance on the apartment will be removed.

How to remove a mortgage encumbrance by force of law

It's hard to find someone who's happy to part with their money unless it's their last mortgage payment. And indeed, you can breathe a sigh of relief - all debt obligations to the bank have been fulfilled, the hard-earned housing becomes the full property of the borrower.

But before you plan a happy life without mandatory monthly payments, you need to play the final chord and obtain title documents for real estate, which will not contain an encumbrance mark.

This is not difficult to do.

• Before making your final payment, contact your bank manager to find out the exact amount you need to pay.
• After payment, receive the following documents from the manager - a certificate of closure of the loan and a mortgage note with a note of repayment. Together with the title documents, passport and mortgage agreement, take them to the MFC.
• In five to ten business days the encumbrance will be lifted. You can pick up a certificate confirming this fact at the MFC.

If you have an electronic signature, the procedure for removing the encumbrance can be carried out using the Internet. To do this, on the Rosreestr website, in the category “Registration of termination of rights, restrictions (encumbrances) of rights”, select the item “Repayment of a mortgage registration record”, enter personal data, attach scans of documents and certify with an electronic signature.

In some credit institutions, for example, Sberbank, the encumbrance is removed automatically. Within two days after repaying the mortgage, you will receive an SMS message indicating that the procedure has begun. You can track the status of the removal of the encumbrance in your personal account. The maximum period is 30 days. If necessary, the bank manager may request additional information or documents.

There are several ways to ensure that the encumbrance is removed.

• Open the Rosreestr reference service (https://rosreestr.ru/wps/portal/online_request) and fill out a simple form. There should be no marks in the “Rights and Restrictions” line. Information is provided free of charge.
• If you have an account on the State website, you must select a property; in the column “Information on restrictions/encumbrances of rights” there will be an o or a dash.
• On the Rosreestr website you can order a paid extract from the Unified State Register of Real Estate.

How is a mortgage issued and terminated by virtue of an agreement?

Everything stated about a legal mortgage is also applicable to a mortgage loan by virtue of the contract. The main difference in the registration procedure is that with a legal mortgage, the application must be submitted by either the buyer (mortgagor) or the bank (mortgagee), and when registering a contractual mortgage, both parties, the mortgagor and the mortgagee, must complete a joint application.

If the transaction is carried out by a notary, then you can only get by with a statement from his side - it will be accepted for consideration. Moreover, applications from notaries are usually processed at a faster pace.