Mortgage for military personnel under contract in 2020: conditions for obtaining

Differences

What is a military mortgage and how is it different from a regular one?

Documentation. To obtain a regular mortgage, you need to prepare a package of documents required by the bank. The only bank requirement for obtaining a military mortgage is that the person must be a military personnel and be a participant in the savings-mortgage system. No additional information will be required. You will find a list of necessary documents for obtaining a military mortgage, information on the procedure for collecting them and submitting them to the bank in a separate article.
Bank. You can get a civil mortgage at any bank, but a military mortgage only at those banks that cooperate with Rosvoenipoteka.
Sum. A regular loan is available for any amount, depending on income, but a military loan has a limit. The longer the term, the larger the mortgage amount will be. It is calculated so that the state can repay the loan amount before the employee turns 45 years old.
Housing. If in ordinary cases there are practically no restrictions on the choice of housing, any new building will do, then in the case of a military mortgage, things are different. A serviceman can only choose housing that has been accredited and approved by Rosvoenipoteka. Military Relocation specialists can help in selecting buildings that meet the requirements of both the bank and Rosvoenipoteka. We talked in detail about what kind of housing can be purchased with a military mortgage and what the specifics of the transaction are depending on the type of real estate here.
Interest rate. Unlike regular mortgages, military mortgages have lower interest rates.

Important! Preferential conditions apply only as long as you are in military service. If a serviceman leaves his service before reaching 20 years of service, you will have to pay the amount of the remaining debt to the bank yourself.

You can read about what to do with a military mortgage when leaving the service here.

If you are thinking about purchasing an apartment, house, townhouse or land plot for individual housing construction using a military mortgage, we advise you to study the terms of the loan, as well as information about the main stages of obtaining a loan.

Important nuances

There are quite a lot of them

Can a person serving in the army take out a housing loan “in civilian life”?

Yes, such a possibility exists and this does not affect the right to take out a military mortgage in the future.

Peculiarities

Until 2020, a military servant who took out a regular mortgage was deprived of the opportunity to receive additional funds , which led to the development of various schemes to circumvent this law. These funds are paid to military personnel who retired from service, the duration of which ranged from 10 to 20 years.

Those who resigned due to intradepartmental organizational and staffing events, as well as the following categories of military personnel, can also apply for them:

dismissed due to health, age and family circumstances;
dismissed due to unfitness (without taking into account length of service);
families of those killed in service.

Until 2020, military personnel and their family members, if they applied for additional funds under the NIS program, were not required to own housing other than those purchased with NIS funds. According to the new Federal Law, the situation has changed for the better for the military. Now housing purchased with a civil (regular) mortgage will not interfere with receiving additional funds under the NIS program .

Additional funds are calculated for the period from the date of dismissal to the date when the citizen’s service should have reached 20 years. Also, when receiving a civilian mortgage, a serviceman can count on loyalty from the banks providing such a loan. In some cases, the mortgage interest rate is reduced by 1-2%.

How does a mortgage work for contract workers?

There has been a military mortgage with government support for more than 10 years. At the same time, all military personnel are provided with an individual approach when creating a loan plan.

A mortgage for military contractors is similar to a mortgage agreement with a bank, however, the first amount is transferred to the borrower’s account from the state budget, and further monthly payments are made by the Ministry of Defense.

The main condition for participation in this program is the funded mortgage system (the abbreviation NIS is often used).

This is important to know: Certificate for housing for military personnel

After joining the NIS, funds transferred by the state for the purchase of housing begin to accumulate on the serviceman’s personal account. They are transferred throughout their entire service life - twenty years.

Expert opinion

Grigoriev Pavel Kirillovich

Head of the department for conscription of citizens for military service of the Russian Federation

However, there is a limitation on the period of their use: a military mortgage for military personnel under a contract allows you to purchase a home after at least three years of service.

Special conditions

A situation may arise when the funds available in the account have not been spent. In this case, the serviceman has the right to use them for any purpose. However, like any program, this state system has some conditions that should be taken into account before using the accumulated finances.

Briefly, these conditions are formulated as follows:

As the service life increases, the amount of subsidies increases.
Families with three or more children receive an advantage in obtaining a military mortgage.
You can use government assistance to purchase housing only once.

Who is it for?

Mortgages for military personnel under a contract apply to military personnel of the following categories:

Warrant officers, officers who entered into long-term contracts after January 1, 2005.
Graduates of military universities who serve on long-term contracts starting in 2005 and in later years.
Military personnel in the position of midshipman or warrant officer who have served three or more years. First contract.
Sailors, soldiers, sergeants, foremen who took office in 2005 and later. Re-contract.

Not only those who are serving, but also military personnel who were forced to leave the army for the following reasons can receive a military mortgage loan:

dismissal for health reasons;
dismissal for family reasons;
resignation due to staffing and organizational changes;
reaching the age limit.

There is also a special condition for military personnel who entered into a contract before 2005. They have the right to participate in the mortgage lending program, but without opening a savings account.

Is it permissible to pay off a regular mortgage using a military mortgage?

There is a legal scheme for paying off a regular mortgage with military funds, but it is rarely used in practice. To do this, you need to contact the bank where the loan was issued with a request to reconsider the existing agreement.

Important! The same application must be submitted to the Federal State Institution "Rosvoenipoteka".

After all the details have been agreed upon between the organizations, the development of an additional agreement will begin , with the permission of which the procedure for repaying the mortgage will be changed.

It does not matter whether the bank that issued the mortgage is on the list of those accredited under the military mortgage program, this is not a ban on the implementation of this plan.

The main difficulty when merging mortgages is coordinating all the nuances with the Federal State Institution “Rosvoenipoteka”, since the key rates are different. In such a situation, everything depends on what agreement the bank and Rosvoenipoteka come to; the rate may either remain the same or change downward .

Is it possible to convert a regular mortgage into a military one?

Of course, such a possibility exists. Moreover, it is officially enshrined in the NIS rules. However, in practice, repayment of an existing loan at the expense of the state is possible only if an agreement is reached between the bank and Rosvoenipoteka. And if the latter most likely approves the transaction, then such requalification of the loan is unprofitable for the financial organization for 2 reasons:

If the mortgage is transferred to a military bank, it will have to reduce the interest rate. Otherwise, Rosvoenipoteka is unlikely to agree to repay the loan.
If the transaction is approved, the purchased housing will have a second mortgagee in the form of the state.

Thus, recharacterization of a regular mortgage into a military one is possible, but cannot be implemented without the consent of the bank. In 2020, the situation with banks is as follows: VTB allows the use of NIS funds only for full early repayment of a mortgage loan, Rosselkhozbank promises to consider incoming applications on an individual basis, and Sberbank refrains from commenting.

Combining these two loans

The simplest and most beneficial option for everyone is if the NIS program participant’s account has accumulated the amount necessary to cover a civil mortgage. When the loan amount is greater than the savings, the NIS participant can use them only if the following conditions are met:

the loan is issued for one person, the serviceman is the only borrower in the agreement;
the balance of loan obligations does not exceed the amount that a serviceman could receive under the NIS to purchase housing;
the bank agrees to conclude an additional agreement.

Problems may arise at the stage of negotiations with the bank, since lowering the key loan rate is not in its interests.

How to get a mortgage

To do this, you must complete the following steps:

Draw up a report addressed to your unit commander about your desire to become a participant in the state military mortgage lending program.

This is important to know: Government Decree 153 on housing certificate: changes for 2020

It is important to know: officers are not required to do this, since information about them is already in the register.

After this, the High Command of the Armed Forces checks all participants using the available lists and, based on the identified need, creates a list of documents that is transferred to the housing department.
The military man who submitted the report is assigned a personal registration number. He receives it in a notification.
Next, on the basis of the NIS, the state support program “Rosvoenipoteka” opens an account for the serviceman.
Receipts to this account will begin immediately after the report is registered in the unit.
The service member then selects a bank to receive funds.
After this, the serviceman chooses housing. A military mortgage allows you to purchase an apartment on both the primary and secondary markets.
An agreement is concluded with the bank.
A serviceman purchases housing through a mortgage program.

Why can they refuse?

Although the state is actually the payer of the military mortgage, its presence affects your solvency. Banks rarely approve a civilian mortgage if there is a military one, due to the high risk of client insolvency.

If the mortgage loan is approved, the amount will be significantly reduced. From all of the above, we can conclude that you can get housing in different and quite simple ways; it is only important to follow all the rules and take into account the nuances of the case.

You need to choose a bank wisely, adequately calculate your strengths and think much ahead, since paying off a mortgage is a long and costly process.

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Is it possible for a military personnel to take out a civilian mortgage?

Many Russians choose a mortgage, preferring to quickly resolve their housing issue. The state facilitates preferential lending to certain categories of citizens. For example, there is a special program for military personnel that provides subsidies for the purchase of real estate.

In this context, the question often arises: is it possible for a military man to take out a civilian mortgage? Let's talk about the nuances of housing lending in 2019.

The legislation of the Russian Federation enshrines the right of citizens to loans and other financial services, regardless of the type of activity. A military personnel, an employee of the Ministry of Internal Affairs, the FSB, or the Air Force can take out a mortgage from any bank by presenting a passport and the required set of documents.

The bank will review the application and evaluate the borrower’s ability to repay the loan on time. In other words, the serviceman must provide proof of his solvency to the credit institution.

A loan will be approved for a borrower who has:

own capital for the initial contribution (at least 20% of the transaction amount);
stable income exceeding two or more times the amount of regular mortgage payments;
property owned (transport, land, dacha, etc.);
good credit history.

When applying for a civilian mortgage, a service member can rely only on his own capabilities. He can attract co-borrowers and guarantors, use personal savings, a family certificate, etc.

In February 2020, the average interest rate on housing loans is from 10% per annum and experts predict an increase in rates.

In what situations is it beneficial for military personnel to take out a civilian mortgage?

Military mortgages have undeniable advantages, and experts recommend that military personnel join the NIS program. This will make it possible to buy housing by receiving compensation from the state: the amount of the subsidy in 2020 is 2.4 million rubles. Banks issue military mortgages at a reduced rate, which is also a big plus.

NIS restrictions on the use of funds: the subsidy is received annually, in parts. You can start using money from your personal account after three years of participation in the program.

For military personnel who urgently need to solve a housing problem, these restrictions are critical. Therefore, they decide to take out a mortgage on general terms.

the serviceman is not yet a member of the NIS;
the permitted period for using personal account funds has not expired (3 years);
have sufficient equity capital and other resources to obtain a mortgage.

What do you need to know before applying for a military housing loan on a general basis?

Many military personnel who take out housing loans plan to then repay them with NIS funds. Is it possible to convert a civilian mortgage to a military one?

the mortgage agreement must be concluded with a single borrower (without co-borrowers);
the bank and Rosvoenipoteka must approve the debt transfer transaction.

To summarize: if you take out a standard mortgage in order to subsequently use NIS money to repay it, sign an agreement with the bank as the main and only borrower. If you rely only on your own strength, choose a bank and enter into a mortgage loan agreement on terms that are favorable to you.

In a number of cases, an officer, a graduate of a military institution or a contract employee needs to purchase their own housing, but there is no opportunity to wait for funds to accumulate in the savings-mortgage system account. This need is most often associated with a family situation, for example, the birth of a child and the reluctance to overpay for renting someone else’s property. According to statistics, children are born in families of career military personnel 25% more often than in ordinary families. That is why the question arises: is it possible for a military man to take out a civilian mortgage and how will this affect his right to participate in the NIS.

There is another option: a person took out a mortgage even before he had the right to become a member of the NIS, and in the future he would like to use the accumulated funds to repay an already received civil loan. For a comprehensive assessment of such cases, it is necessary to remember what the NIS itself is, what requirements are imposed on its participants, and under what conditions the amount of contributions from the state may be limited.

has replaced public housing programs for military personnel since 2005. It immediately became obvious that in the modern world this approach is much more convenient for both the government and the NIS participants themselves. In fairness, it should be noted that those who entered the service before 2005 and need housing will be provided with apartments through the allocation of housing in kind, and in some cases with the help of targeted subsidies, which is more convenient.