What documents are the basis for moving into a residential premises?

Last modified: October 2021

The abolition of the usual pink certificates issued to property owners has created a stir regarding legal documentation for housing. Since 2021, an extract from the Unified State Register of Real Estate is the only necessary and sufficient document confirming ownership of an apartment or other real estate object, which has equal legal force in printed and electronic form. The registration process has been simplified, but does not eliminate questions regarding the validity of previously issued forms required by law and the need to replace them.

New statement format

Changes made to Law No. 218-FZ from 01/01/2017 combined two independently and independently operating documentation forms into one:

• extract from the Unified State Register;
• cadastral passport.

The new official document to confirm ownership is called an extract from the Unified State Register of Real Estate. What does the document for ownership of an apartment or other real estate look like? The certificate is the quintessence of the previously issued two forms above and is the only information document on the territory of Russia that states that an object belongs to a specific owner at a given point in time.

The extract is issued electronically or on paper at the client’s request, indicating information about the apartment:

• actual location indicating the legal address, purpose, floor location and total area;
• graphic plan of the apartment indicating partitions;
• Full name of the owners with a reflection of the share of ownership of each owner;
• detailed information about the document - the basis of ownership of the apartment, indicating the name, assigned number and time of registration by the state organization;
• information about restrictions or encumbrances indicating the date and reason for imposition;
• cadastral numbers, date of assignment with designation of cadastral value.

If the property is not privatized, then the statement will indicate the absence of information, since only privatized objects are included in the Unified State Register of Real Estate.

Electronic and paper formats of statements have equal legal force. The authenticity of the paper medium is confirmed by the blue seal of the registrar, and the authenticity of the electronic counterpart is confirmed by the digital signature of the responsible person of the government agency.

What to check in the “Certificate of Ownership” or in the “Extract from the Unified State Register / Unified State Register” for an apartment?

1. Object of law (real estate object) . — We make sure that we looked at exactly the apartment we wanted. We check the address and area.
2. Subject of law (right holder) . — We make sure that the seller of the apartment is exactly the person we need. We look at his passport and check the data. It is with him that we will enter into a deal, and it is with him that we will have to deal with if the deal subsequently turns out to be disputed or invalid. In addition, several legal entities (owners) may be indicated here.
3. Let's look at the Type of Law . “We are only interested in “Property.” If several entities are indicated in the Certificate, then the property is indicated as “common joint”. If the property is indicated as “common share”, then the number of shares in the right is indicated (for example, “share in the right 1/2”), and in this case, each “shared” owner will have a separate Title. The type of property will matter further when signing the Apartment Purchase and Sale Agreement (APA).
4. Let's look at the purpose of the object . — We are only interested in residential purposes. It happens that the owner transfers the apartment to non-residential use.
5. Let's look at the Documents that provide grounds for obtaining ownership of the apartment. — We will be interested in the document on the basis of which ownership was obtained. This is the main title document for the apartment. We will study it in the next step of the INSTRUCTIONS. - Note! Information about the basis document is not present in all Extracts of the Unified State Register of Real Estate (USRN) (more on this later).
6. We look at the presence of registered Restrictions (encumbrances) of the right . — Encumbrances can be a court arrest, a pledge (mortgage), a rental agreement, etc. It is better, of course, if the apartment has no encumbrances, but some encumbrances (more on this in the next steps of the INSTRUCTIONS) do not interfere with the purchase of an apartment. — The presence of registered legal claims or legal disputes in the Unified State Register Extract clearly indicates to us that an apartment should not be purchased until these issues are resolved.
7. Date of issue (in the Title) or date of state registration of the right (in the Extract). - This is the same date, and it speaks about the period during which the apartment is owned by the owner. The longer this period, the potentially less risky the purchase of such an apartment. If the Seller received ownership rights quite recently, then the question arises about the reasons for such a quick resale of the apartment. We'll talk more about this below. In addition, this period of ownership affects the amount of tax upon the sale of an apartment, which the Seller incurs as a result of the transaction.
8. We look at the execution of the Certificate (document) as a whole. — If the Title was issued before 2015, then this is colored “stamp” paper with security designs (small thin design, like on banknotes), watermarks in the light, a clear imprint of the official seal of the Federal Registration Service, and the signature of the registrar, whose surname is duplicated next to it, in the form of a letter stamp. As well as the series and number of the Certificate indicated at the bottom of the document; — Since 2015, the Certificate of Registration of Rights has been issued on regular white A4 paper, with the same data, signatures and stamps. — From July 15, 2021, Certificates of registration of rights were no longer issued by Rosreestr; they were completely replaced by an Extract from the Unified State Register (USRN) .

What an Extract from the Unified State Register looks like can be seen here:

♦ What does an Extract from the Unified State Register look like ♦

In fact, even if we are presented with a Certificate of Ownership of an apartment (Title), from there we only take primary data that requires verification. The title was not issued yesterday, but several years ago, and the data on property rights in Rosreestr could have changed.

And this data is checked against a fresh Extract from the Unified State Register (USR) , which we can order ourselves, even without the knowledge of the Seller (for example, on our website - HERE).

Just in case, let us clarify that there are several types of Extracts from the Unified State Register (EGRN) for an apartment with different types of data from the registry (for more information about them, see the link in the Glossary). For example, data about the base document is not present in all extracts (this is also discussed in the link).

Which Sellers are better not to buy an apartment from and why – see this article.

The Supreme Court of the Russian Federation recalled the importance of timely registration of rights to real estate

Actual topic

In modern realities, there are cases when the seller transferred real estate to the buyer under a purchase and sale agreement, the parties recorded the transfer in the transfer and acceptance certificate, but did not take steps to register the transfer of ownership. And who owns the property? Such a case was recently considered by the Supreme Court of the Russian Federation. Read more about this in the article by Anastasia Roy.

Rights to property subject to state registration arise, change and terminate from the moment the corresponding entry is made in the state register - this is an axiom of property relations, which is enshrined by the legislator in paragraph 2 of Article 8.1 of the Civil Code of the Russian Federation.

Paragraph 1 of Article 131 of the Civil Code establishes that the right of ownership and other real rights to immovable things, restrictions on these rights, their occurrence, transfer and termination are subject to state registration.

Accordingly, the right of ownership of real estate is subject to state registration and arises precisely from the moment the corresponding entry is made in the state register.

In modern realities, there are cases when the seller transferred real estate to the buyer under a purchase and sale agreement, the parties recorded the transfer in the transfer and acceptance certificate, but did not take steps to register the transfer of ownership. It is difficult to say whether this happens due to forgetfulness or legal illiteracy, but this does happen.

A similar case was recently considered by the Supreme Court of the Russian Federation: property was transferred, but the parties forgot to register the transfer of ownership. Meanwhile, the previous owner went into bankruptcy.

So who owns the property? The new owner (the right is not reflected in the register, but actually owns the property) or the previous owner (the right is reflected in the register, but does not actually own the property)?

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Fable of the case

The seller transferred five non-residential buildings to the buyer under a real estate purchase and sale agreement. The buyer's ownership of the purchased objects was registered.

Subsequently, the seller, citing the buyer’s failure to fulfill the obligation to pay for the property, filed a claim in a court of general jurisdiction to terminate the said contract.

By a decision of a court of general jurisdiction, the contract was terminated, and the buyer was obligated to return the transferred property to the seller. The buyer actually returned the property according to the transfer and acceptance certificate of real estate. Only the transfer of rights was never registered.

More than a year from the date of transfer of property, the buyer was declared bankrupt and a procedure for the sale of his property was introduced.

Arbitration courts of three instances decided who should retain the property: the courts of the first and appellate instances pointed out that the statute of limitations had passed on the statement of the financial manager, the district court agreed and additionally noted that actions to return property in pursuance of a judicial act cannot be qualified as committed for the purpose of causing harm to the debtor’s creditors or with abuse of right.

As a result, the property remained with the actual owner, despite the absence of a corresponding entry in the register about his right.

Decisive and final was the Determination of the Judicial Collegium for Economic Disputes of the Supreme Court of the Russian Federation No. 310-ES21-1061 dated May 27, 2021, which sets out a position radically different from that of the lower courts.

Thus, according to paragraph 1 of Article 213.25 of the Federal Law of October 26, 2002 No. 127-FZ “On Insolvency (Bankruptcy)” (hereinafter referred to as the Bankruptcy Law), all the property of a citizen available on the day of the decision to declare him bankrupt and identified or acquired after that day, constitutes the bankruptcy estate, with the exception of property that cannot be foreclosed on in accordance with civil procedural legislation.

Since at the time of the opening of the procedure for the sale of the debtor’s property the real estate had not been transferred (due to the absence of a corresponding entry in the state register on the transfer of the right to the property), the real estate objects, on the basis of the above provision, are included in the bankruptcy estate of the debtor.

The Supreme Court of the Russian Federation ordered the actual owner to transfer all five real estate assets to the debtor's financial manager for their subsequent sale and settlement with creditors.

Accordingly, the property remains with the debtor, and the actual owner, who had the property at his disposal for 1 year and 4 months, loses the opportunity to return ownership of the property in the debtor's bankruptcy procedure. The claim for the return of property is transformed into a monetary one and is satisfied on an equal basis with the claims of other creditors in the general manner.

What if the debtor is not a citizen, but a legal entity?

The legislator has provided a similar provision for the bankruptcy of legal entities, enshrining it in paragraph 1 of Article 131 of the Bankruptcy Law, according to which all the property of the debtor available on the date of opening bankruptcy proceedings and identified during bankruptcy proceedings constitutes the bankruptcy estate.

Summarizing the above, it is necessary to highlight the main thing: rights to property subject to state registration arise, change and terminate from the moment the corresponding entry is made in the state register, and not at the time of the completion or actual execution of a transaction or the entry into force of a court decision, on the basis of which they arise, change or rights are terminated.

In simple terms, appropriate entries must be made in the state register promptly and in a timely manner in order to avoid disastrous consequences, for example, the inclusion of property in the bankruptcy estate of the debtor, whose ownership remains reflected in the register.

Legal documents

The transfer of ownership of an apartment, garage, house, land plot and any other real estate object is subject to state registration (Article 551 of the Civil Code of the Russian Federation). The title documents for the apartment have undergone changes over the past few years, starting in mid-2021.

The location of the real estate object in the personal possession of the owner was documented using:

1. Certificates of state registration of ownership of the apartment. The official cancellation of the standard pink form occurred on July 15, 2016, raising the questions: which form is the legal successor and what does the document on ownership of the apartment look like from that date? Extracts provided from Rosreestr and the cadastral chamber could be obtained in parallel during the validity period of the certificates, but they carried background information and served as an appendix to the main document on the ownership of the apartment.
2. Extracts from the Unified State Register. After the certificate was cancelled, the standard form, printed on white paper, became the only document - the basis of ownership of an apartment or other property.
3. Extracts from the Unified State Register of Real Estate. The combination of the cadastral certificate and the above form from the Unified State Register has been in effect since 01/01/2017 thanks to the innovations introduced by Law No. 218-FZ of 07/13/2015. Confirmation of real estate ownership is carried out on the basis of a newly created and approved form.

Documents confirming the ownership of an apartment issued before July 15, 2016 continue to be valid, however, to carry out legally significant transactions, an extract from the Unified State Register is required. The validity period of the certificate is not limited, but to confirm property rights, the form should be updated before the transaction in order to exclude the transfer of housing to third parties or the imposition of encumbrances for the period that has passed since the receipt of the previous form.

The time interval for “trust” in the extract is one month from the date of actual receipt; the certificate does not contain an official validity period. Replacing title documents for an apartment and other real estate does not entail changes in the procedure for completing transactions, but only confirms the identity of the owner.