Russian Railways employees can receive a subsidy and a preferential mortgage for housing: who can apply for what?

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Buying a home on your own is very difficult. An apartment is expensive, and the income level of Russians is quite low. The way out of this situation is to take out a mortgage. When it comes to housing loans, Russian Railways employees have a number of advantages over other categories of citizens. The company is ready to provide a corporate subsidy and compensate part of the interest rate. As a result, the monthly burden on the specialist’s budget will be significantly lower. However, to use a Russian Railways mortgage, it is important to comply with a number of requirements.

What is mortgage lending from Russian Railways?

Railway mortgage is a unique program that allows Russian Railways employees to reduce interest rates on housing loans. The service has a small initial fee. In some situations, there is no need to make an advance payment completely. The company provides a subsidy that makes it possible to significantly reduce costs. There is no need to return funds. A Russian Railways mortgage can also be provided upon the birth or adoption of children.

Loan collateral

Insurance

If housing is purchased in a new building, be sure to take out a policy for the entire term of the loan agreement. This is done in case of disability or death of the borrower.

Violation of contract terms

A mortgage from Russian Railways VTB can be obtained without an insurance policy. But, in this case, the bank doubles the interest rate on the loan.

What do they offer for Russian Railways employees?

Attention
There are several types of assistance in solving the housing problem for Russian Railways employees. The company is ready to provide corporate housing or provide a free subsidy. In both situations, a number of conditions must be met.

Corporate housing.

Corporate housing is a type of real estate that is provided to individuals who are forced to live close to work. The premises are issued to an employee of Russian Railways for the period of work in the organization. The property remains the property of the employer. However, under certain conditions, the company can afford to buy the premises. If we are talking about Russian Railways, purchasing a corporate apartment as a property is possible if the following requirements are met:

• work experience in the company exceeds 20 years;
• the person has lived in the apartment for more than 10 years;
• the citizen is registered to receive corporate support.

If the company cannot provide real estate, the citizen may be given monetary compensation for renting an apartment.

Free subsidies.

Additionally, a person can count on receiving free subsidies. The funds can be used to pay part of the cost of the property or pay off the mortgage. The amount of assistance varies from 5 to 70% of the market value of the premises. The indicator is determined individually. It depends on:

• family composition and total income of all its members;
• the amount of time the person has been registered as needing corporate support;
• compliance with living space standards;
• the average market price of one square meter approved for a specific region.

The subsidy from Russian Railways can be used to purchase real estate on the primary or secondary market. The person is given six months to choose a room. When the period ends, the employer has the right to demand confirmation of the intended use of funds. The list of persons to whom the company guarantees the issuance of subsidies is limited.

The list included:

• WWII participants who subsequently worked for Russian Railways and retired from labor groups 1 and 2;
• families of persons killed in an industrial accident;
• employees, single parents;
• persons who work in areas with labor shortages;
• large families raising at least 4 minor children;
• employees who had children during the closing period of their housing loan.

Please note:
In the latter situation, you can receive compensation in the amount of 200,000 rubles for each child. However, the amount of payment cannot exceed the amount of the remaining debt.

One-time subsidy

Mortgage bank revival: conditions, interest rate

A one-time subsidy, intended to partially pay for the cost of housing purchased by a railway worker, is provided to the following categories of recipients:

• pensioners of Russian Railways who were participants in the Second World War;
• subjects who were injured while performing work duties in Russian Railways, as a result of which they were assigned a disability of the first or second group;
• to the families of Russian Railways workers who died as a result of accidents that occurred at work;
• employees from large families;
• workers who lost their own housing due to emergencies or natural disasters;
• employees who previously took out a mortgage on the terms of partially subsidizing interest charges and who had children while repaying the relevant obligations.

The amount of such a one-time subsidy usually varies in the range of 5-70% of the price of the purchased housing.

A one-time subsidy is issued through an authorized credit institution and is issued by non-cash transfer to the railway worker’s personal account.

Mortgages are also provided by the same bank, but on a general basis. The Russian Railways employee independently pays off the difference between the total price of the purchased apartment and the amount of the subsidy provided. Such a subsidy can be used by the recipient exclusively for the purchase of living space in an apartment building constructed by the Zheldoripoteka organization, or, alternatively, for the purchase of secondary housing.

Who can get a railroad mortgage?

Preferential mortgages are not available to all Russian Railways employees. To qualify for assistance from the organization, you must meet a number of requirements. They are presented to:

1. Age of the potential borrower. These conditions are determined by the bank. Loans are usually issued to persons who are already 21 years old. At the time of closing the obligations, the borrower, most often, should not be older than 65 years.
2. Citizenship. Only Russians can take part in the preferential program.
3. Monthly income. Loan payments should be half your monthly earnings. Additionally, the cost of living for each family member is deducted from the amount.
4. Continuous experience. You must work for Russian Railways for at least 3 years. The exception is young professionals.
5. Need for housing. Preferential railway mortgages are provided only to those in need. You must be on a waiting list to improve your living conditions.

Summary

In practice, obtaining a mortgage on preferential terms for an employee of Russian Railways is not particularly difficult. According to borrowers, the most difficult stage is submitting documents and waiting in line at the Russian Railways Housing Commission. After the employee has approved and signed the subsidy register (the procedure can take several years), the potential VTB borrower will only have to choose suitable housing and submit documents to the bank, which on average takes about a month. Consideration of the application at VTB takes place within several days; in rare cases, the period can be extended to 10 days.

Despite the fact that the borrower saves a significant amount of money by compensating part of the interest by the employer, many refuse the proposed subsidy due to the significant inflation of housing prices from Zheldoripoteka. Therefore, when applying for a preferential mortgage, it is also necessary to consider and evaluate the option of purchasing housing on general terms using any loan calculator.

How to obtain the status of a young specialist of Russian Railways?

Young specialists of Russian Railways are graduates of full-time educational institutions under the age of 30 who:

• received a higher education diploma;
• graduated from graduate school;
• received a diploma of secondary vocational education.

To become a Russian Railways specialist, you must get a job in an organization in compliance with the following deadlines:

• within 3 months, if an agreement on targeted training was concluded;
• within 3 months, if there is a job assignment issued by an educational organization at the request of Russian Railways divisions;
• completion of training for other graduates hired by Russian Railways.

If a person is employed by a company within the above deadlines, there is no need to take action to obtain the status of a young Russian Railways specialist. The procedure is carried out automatically. A person is considered a young specialist for 3 years from the date of employment, but no later than reaching the age of 30 years. If a person is transferred from one Russian Railways unit to another, the status is maintained and the period of its validity is not interrupted.

Attention

If a citizen is recognized as a young specialist, he can receive a housing loan without a down payment. Additionally, a free subsidy in the amount of 200,000 rubles is provided for the birth of children. The rule applies if the child was born at the moment when his parent was paying off the mortgage.

Material payments and benefits under the Zemsky Doctor program

There is a “Zemsky Doctor” plan for youth, the only type of scheme available at the federal level. The highest task set for the project is the consent of graduates of medical universities to continue “agrarian life.” The latter is in serious decline due to the lack of specialized people in the villages. Therefore, the personnel situation is very important.

For small areas there is a shortage of certified specialists. The one-time bonus paid to group members amounts to 1,000,000 rubles. It should only be used to purchase an apartment, house or room.

To register for membership, physicians are required to complete the following sections as of 2021:

• receive a diploma and a certificate of completion of residency or internship;
• join the staff of any village;
• be under 45 years of age;
• conclude a contract with the city committee.

The amendments, which provide more suitable positions for health workers, are a good incentive for further decisions on appointments. Raising the upper limit for those who took the Hippocratic Oath is a motivating change: previously the maximum age was 35 years. When more flexible standards emerge, it is no longer necessary to enter into an agreement with the Ministry of Health, as was required in the previous version. Now it is enough to provide the seal of the contract with the head of the municipality. Participants are not only people who agree to move to the village, but also those who lived there previously and came back after receiving higher education. Those doctors who are registered in a medical institution of a rural branch or in a municipal representative office are also allowed to participate.

In which banks can you get a mortgage from Russian Railways?

The company cooperates with the following financial organizations:

1. Sberbank. The standard rate is 9.5% per annum. As part of corporate support, it can be reduced by 2%.
2. VTB. It provides home loans at 8.9% per annum. Russian Railways employees can use the company's services as part of a preferential mortgage and reduce the overpayment to 2-4.5%.
3. Absolut Bank. The standard offer rate is 8.95%. As part of using corporate support, the overpayment can also be reduced to 2%.

The conditions are valid at the time of writing; to clarify the latest information, contact a specialist.

Where to go

First you need to register for housing. To do this, you need to contact the local administration. Then, in order to become one of the participants in Russian Railways mortgage lending, you should join the appropriate queue at your place of work.

When the turn comes, a Russian Railways employee needs to apply for a loan to VTB 24 Bank. It is with this financial organization that the railway company cooperates in terms of mortgage lending to its employees, therefore, not only the purchased apartment, but also a guarantee from Russian Railways can serve as collateral for a long-term housing loan .

What are the requirements for real estate with a Russian Railways mortgage?

The premises must meet the requirements of the financial institution. An apartment can be purchased with a Russian Railways mortgage on both the primary and secondary markets. If a person wants to purchase an apartment in a new building, its construction must be carried out by the Zheldoripoteka company or other legal entities that have received accreditation from VTB and Absolut Bank. When the purchase of premises is carried out on the secondary market, the seller can be an individual. However, the premises must meet the following requirements:

• be located in the region of presence of the financial organization that allocated money for the purchase of an apartment;
• be equipped with all communications;
• have a separate kitchen and bathroom;
• all necessary equipment for living must be in good working order;
• not be located in a house that is subject to demolition or reconstruction;
• do not have wooden floors.

IMPORTANT
Financial organizations lend money only for liquid property.

Loan conditions for railway mortgage

The terms of the RJ mortgage differ significantly from the classic ones. In particular, you can do without a down payment if the purchase of premises is carried out in a new building. For the secondary market, the indicator depends on the financial institution to which the application is made. The minimum down payment will be:

• 10% – in VTB;
• 10% – at Absolut Bank;
• 15% – in Sberbank.

The property must be pledged to a financial institution. The property will be encumbered until the loan is fully paid off. Life insurance is available upon request. However, refusal to purchase a policy will result in a rate increase of 1%. Purchasing a policy that protects property against the risks of loss or damage is mandatory.

Attention

The minimum interest rate, taking into account the subsidy, for a young specialist is 2%. For all other employees, the rate starts at 4.5% per annum.

The available limit at VTB is 60 million rubles; at Absolut Bank, this figure is reduced to 15 million rubles. The size of the available limit in Sberbank starts from 300,000 rubles and depends on solvency and the value of real estate. It is necessary to make payments on a Russian Railways mortgage with a subsidized rate within 15 years.

Early repayment is acceptable without penalties or commissions. However, it is important to follow the rules set out in the loan agreement. The financial institution will have to be notified of the planned action at least one month before depositing funds.

New buildings

New buildings also have special requirements:

• It is desirable that the developer be included in the list of accredited organizations. Otherwise, refusal is possible;
• in the housing being purchased, the kitchen must be allocated as a separate room, which removes a studio apartment from the list of potential properties;
• the presence of a connection to the centralized supply of water and electricity or ready-made (agreed with resource suppliers) relevant documentation and a clearly foreseeable future for such connection.

The purchased housing is pledged to VTB24. In some cases, it is possible to replace this security with a guarantee from Russian Railways.

How to calculate the amount of the subsidized mortgage amount for Russian Railways?

The subsidized part of the loan directly depends on the composition of the family. Take into account:

• spouse;
• minor children;
• adult children who are over 18 years old, but they did not have time to start their own family at the time of filing the application.

To calculate the total amount of the subsidy, it is necessary to determine the price of one square meter of apartment and the living space standards per family. The first indicator is calculated using the following formula:

Cost per square meter = average market price per square meter in a particular region x adjustment factor

In the Russian Federation the following standard for living space has been established:

• 33 square meters per person;
• 42 square meters for 2 people;
• 18 square meters for each family member, if the family consists of three or more people.

As a result, the approximate amount of the subsidy is:

• one person – 1.5 million rubles;
• two people – 1.9 million rubles;
• three people – 2.5 million rubles;
• four people – 3.3 million rubles.

The exact numbers depend on the place of residence of the applicants for the benefit. The indicator is fixed at the Russian Railways management level.

Payment schedule

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Required documents for registration

To apply for a preferential railway mortgage, you need to prepare a package of documents. The list must include:

• passport of a citizen of the Russian Federation;
• SNILS;
• ticket for men under 27 years of age;
• diploma of completed education;
• work book;
• income certificate.

Please note:
The above documents are used to make a decision on granting a railway mortgage. If a person has additional income in other organizations, the list of papers must include an employment contract concluded with the employer, as well as a certificate of income for the past calendar year and months of the current calendar year.

Documents for registration to receive corporate support are provided separately. The applicant must present the following certificates:

• about income according to Form 2 of personal income tax for the last 6 months;
• about the area of ​​the apartment from the BTI;
• about property owned by all family members;
• on the number of persons living in the current premises.

The list of documents may differ; this will be reported separately.

Registration and delisting

Registration of benefits for railway workers is carried out after the employee is registered.
This must be done at the place of work; the employee must submit an application. If the committee approves it, then the person gets in line. The wait may take about 2 years. When an employee is transferred to another region (locality), he has the right to remain in the current queue and receive a subsidy in the city where the application was first submitted, or to submit documents for a new place of work, and the previous queue will be lost. Marriage does not affect the order of the queue, but will require resubmission of documents.

An employee can receive a subsidy in two cases: if he fully complies with the requirements or management applies for it.

Out-of-turn subsidies are provided to transferred managers, veterans and people with disabilities. And also to those who have lived in the technological premises for more than 10 years and vacate it in the prescribed manner.

Refusal to provide benefits or exclusion from the list occurs for the following reasons:

1. Improving living conditions for any reason (registration of marriage, if the spouse owns living space that exceeds the regional standard, receiving an inheritance, etc.).
2. Identification of false information that became the basis for registration, or refusal to provide the necessary documents.
3. The fact of deliberate deterioration of living conditions.
4. Receiving a housing subsidy from the state (does not apply to maternity capital).
5. Dismissal at your own request. If an employee is dismissed due to military service, he is excluded from the queue, but can be reinstated upon completion of his military service.

The Housing Commission reviews all real estate transactions over the past 5 years. If the fact of registration of people who are not close relatives is revealed, the sale of housing without subsequent acquisition of another, exchange for a worse premises, the benefit will be denied. If such actions were carried out, even without the intention of receiving a subsidy, 5 years must pass from that moment.

How to apply for a Russian Railways mortgage?

Getting a subsidized mortgage from Russian Railways is much more difficult than taking out a classic home loan. If a person wants to take part in the program, they must follow the following procedure:

1. 
   Register as a person in need of improved housing conditions. To do this, you need to contact your place of work and provide a package of documents.

2. Wait for a decision to be made. The submitted documents are checked. If a person does qualify for a corporate subsidy, they are included in the registry of applicants. Then a meeting of the housing commission is held. After time has passed, a decision is made to provide corporate assistance and the amount is approved. The corresponding decision, together with an extract from the protocol, is sent to the department in which the employee works. Additionally, information is transmitted to authorized banks with which cooperation is carried out, as well as to Zheldoripoteka CJSC. A positive decision is valid for 3 months. If a person does not have time to take advantage of the subsidy, the period may be extended for a similar period based on the decision of the commission. The head of the department in which the employee works must make a corresponding request. If an application for extension of the term is not submitted, the right to a subsidy for the Russian Railways mortgage is lost. The person is deregistered without their restoration.
3. Having learned about the approval of the subsidy, the citizen must apply for a mortgage. To do this, you need to contact the bank with which Russian Railways has a partnership agreement. The financial institution will review the application. If the citizen satisfies the established requirements, the company gives consent for the home loan.
4. Select a suitable premises and offer its owner to conclude a deal. If the person agrees, a preliminary purchase and sale agreement is drawn up between the parties. Additionally, the potential borrower will organize an appraisal of the apartment. The current owner of the premises is required to collect documents for the property. The list will include technical and title papers, documented consent of the spouse to enter into a transaction if the property is joint property, permission from the guardianship authorities if part of the premises belongs to children.
5. Submit documents for the apartment to the bank. The financial institution verifies the premises' compliance with established requirements. If no errors are identified, an agreement will be concluded with the borrower.
6. Provide a down payment, if there is a need for it, insure liability and re-register the property. Additionally, you have to prepare a mortgage and submit it to the bank. Here the document will be stored until full settlement of the Russian Railways mortgage obligations.
7. Wait until the company transfers funds to the seller. Cash amounts are not provided.
8. Take the loan agreement and deliver it to your place of work. After this, mortgage subsidies begin.

Who is covered by preferential programs?

It is necessary to determine the requirements for the borrower of a preferential mortgage.

According to the terms of the program, only young specialists are eligible to participate. But in the Labor Code or other legal acts of the Russian Federation there is not a single direct definition of this status.

Based on the content of some regional regulatory documents offering benefits for obtaining a mortgage, it is possible to determine the main criteria for the “young specialist” category:

• age up to 35 years (up to 40 years for a researcher).
• A specialized education obtained full-time at a primary, secondary or higher educational institution, and completed no more than 12 months ago.
• Primary employment in a specialty in a budgetary institution.

In addition, there are additional restrictions and requirements for the minimum length of service in a position for each specialty.

Teachers

• Age no more than 35 years (no more than 30 years for some regions).
• At least one year of work experience in a non-profit organization providing general educational services (schools, colleges and technical schools, universities).

Researchers

• Age up to 35 years (up to 40 years for Doctor of Science).
• Work experience in a scientific organization for at least 5 years.

Within the framework of social programs, there are no restrictions on the specialty acquired while studying at an educational institution. This means that even a teacher who graduated from a university at least a year ago is entitled to subsidies, but the profession indicated in his diploma is not related to pedagogy.

Doctors

Health care employees are provided with benefits if they move to rural areas. However, subsidies are not allocated to everyone - preference is given to in-demand specialists.

Conditions for receiving benefits:

• Age up to 35 years.
• Employment and living in rural areas.
• Concluding an employment contract for a period of at least 5 years.

Military personnel

Housing for military personnel is provided from the federal budget. A prerequisite for receiving a subsidy is the participation of a military specialist in the NIS - a savings mortgage system.

NIS participants wishing to obtain a military mortgage make contributions to a special fund for 3 years. It is worth noting that participation in the funded system is a serviceman’s right, not an obligation.

Documentation

Requirements include the availability of the necessary documents to receive preferential loans, subsidies or other forms of social support.

1. Passport + additional identification document (SNILS, TIN, driver's license, etc.)
2. A document confirming income (certificate in form 2-NDFL is required, but other proof of income is also allowed, including from additional places of work).
3. Certificate of employment.
4. A document confirming the absence of residential real estate in the property (for example, a certificate from the BTI).
5. Confirmation of the availability of savings sufficient to pay the down payment.

Some categories require additional occupation-specific documents.

Thus, young scientists have to document their academic degree.

Bank offers

At the moment, not all banks are willing to accommodate young professionals, refusing them mortgage lending services.

The reason for this is often insignificant work experience and the absence of other entries in the work book. This fact does not allow us to judge how responsibly the future borrower will take the loan.

But financial institutions also need clients, so offers to provide loans to employees of budgetary institutions on preferential terms regularly come from small regional banks, as well as large organizations such as VTB.

A young specialist has a much better chance of getting a mortgage under the young family program. Since 2021, the list of lenders cooperating with AHML has expanded significantly.

Below are the best offers from the most reliable banks:

Valuation of an apartment with a railway mortgage

Attention
The appraisal of a mortgaged apartment is a mandatory procedure that is performed regardless of whether a corporate support facility is used in the process of obtaining a home loan or not. It is important for a financial institution to know that the loan will be secured by liquid collateral. Otherwise, if the terms of the contract are violated, the company will have difficulty selling the property.

To carry out the assessment procedure, a specialist who has the right to conduct such activities is invited. Often, a financial institution enters into an agreement with specific companies whose services it asks clients to use. The specialist studies the property, takes into account its position, condition, takes into account the market situation, and then prepares documentation that records the final price of the premises. The appraiser's services are paid for by the borrower.

Kinds

JSC Russian Railways provides its employees with the following groups of benefits:

1. Basic social package.
2. A social package with equity participation is services that are paid jointly by the company and the employee, this includes:
   Spa treatment;
3. corporate pension program;
4. housing subsidies.
5. A compensated social package is additional services that an employee “orders” for the next working year within the budget allocated to him.

Benefits for railway workers apply not only to current employees, but also to non-working pensioners, depending on their length of service. Those who retired due to an occupational disease, injury or injury are entitled to full preferences.

Sources

1. Andreev, Nikolai Monument for verbal courts: monograph. / Nikolay Andreev. - Moscow: Mechanical Engineering, 1992. - 743 p.
2. Federal Law “On Enforcement Proceedings”. Federal Law “On Bailiffs”. Texts with changes and additions for 2021; RSUH - Moscow, 2021. - 514 p.
3. Document forms. To help the car enthusiast; Eksmo - M., 2009. - 449 p.
4. Trading rules. Sanctions (resolution of the Government of the Russian Federation) with additions and changes for 2021; AST - M., 2021. - 278 p.
5. Practical accounting. Official materials and comments (720 hours) No. 10/2015; Science - Moscow, 2015. - 666 p.

Railway mortgage insurance

Insurance significantly increases the cost of your mortgage. However, banks are trying to encourage citizens to buy a policy. For financial institutions, this is an additional way to minimize risks. First of all, you have to buy mortgage insurance against destruction or damage to property. It will not be possible to avoid purchasing a policy when applying for a mortgage from Russian Railways. The need for it is stated in Article 31 of Federal Law No. 102 of July 16, 1998. Additionally, banks are asking for life and health insurance. When it comes to a railroad mortgage, purchasing a life insurance policy is not necessary. However, refusal to take out insurance will increase the interest rate by 1%.

If real estate is purchased on the secondary market, title protection is additionally required. However, insurance is also voluntary. But refusing it can affect the likelihood of a positive decision on your mortgage application.

Content

Buying your own home is a complicated process. Most banks today offer far from favorable mortgage loan terms, so for many, the dream of owning their own home remains a dream. But for Russian Railways employees, VTB Bank offers completely different conditions.

Mortgages from VTB have a low interest rate, which creates favorable conditions for purchasing your own home. This type of lending is especially highly valued by young families, for whom it is important to preserve their family budget as much as possible.

Features of repaying a Russian Railways mortgage

Calculation of railway mortgages is carried out according to the classical scheme. The citizen will have to make monthly payments. Additionally, early repayment of obligations is permitted. In this case, you must notify the bank one month before performing the procedure.

It is noteworthy that the corporate subsidy is not transferred in a lump sum. Russian Railways takes on part of the loan payments. If a person resigns from Russian Railways, the subsidy payment stops. For the remaining period of closure of obligations, the standard interest rate will be set at 8–9% per annum.

Liability for violation of the terms of the mortgage agreement

A citizen is obliged to make timely payments under the Russian Railways mortgage agreement. Violation of the agreement may result in prosecution. Fines may be applied to the defaulter, and penalties will be charged on the amount not paid.

Attention

The occurrence of delays can affect the receipt of subsidies. Information about this is sent monthly to the financial service of Russian Railways. If the borrower does not pay the loan for more than 6 months, the citizen will be excluded from the register. As a result, the mortgage subsidy is cancelled.

It must be remembered that a housing loan is provided against the security of the purchased property. If a citizen violates the terms of the contract, the bank has the right to go to court with a demand for the sale of the encumbered property. The proceeds will be used to pay off the debt.

Reasons for refusing a mortgage from Russian Railways

If a citizen has received a subsidy, this does not mean that he will be given a mortgage. The decision to provide funds is made by the bank. Issuing mortgage loans is a company's right, not an obligation. Therefore, the application may be rejected without explanation. The most common reasons for making such a decision are:

• bad credit history;
• unstable financial situation;
• the citizen has other outstanding loans, and the total burden exceeds 50% of earnings;
• the borrower has not previously taken out loans;
• an incomplete package of documents was provided;
• The citizen does not have money for the initial payment (if there is a need to provide the amount).

Advantages and disadvantages of a railway mortgage

The main advantage of using a Russian Railways mortgage is the ability to obtain a housing loan on acceptable terms. By using the service, the borrower will be able to save significantly. At the same time, Russian Railways attracts and retains good specialists in this way, and also solves personnel problems in the regions. However, there are also quite a few disadvantages:

• the choice of real estate is limited;
• You will have to wait to take advantage of the subsidy;
• You can use a limited number of banks;
• If a citizen does not have time to use the service within three months, he will be excluded from the program.