What is needed to register ownership of an apartment in connection with closing a mortgage loan?
Making the final mortgage payment allows the borrower to complete the loan agreement and obtain a mortgage on the living space. Removal of the burden occurs in several stages:
- Contacting the bank. After repaying the loan, you need to get a mortgage from the bank and a document with a note stating that the lender has no claims against the client, since he has fulfilled his financial obligations.
- Receiving an account statement. You need to ask the bank for an account statement proving the loan has been repaid. This is done as a safety net so that subsequently no disagreements arise between the lender and the client.
- Contacting the registration authority. With the received papers, the owner of the mortgaged apartment needs to contact Rosreestr.
- Data is entered into the Rosreestr database indicating that the apartment is completely free of encumbrances. If desired, the apartment owner can order a new certificate for living space without a note stating that the apartment is secured by the bank.
What to do next if the debt is paid off early?
If you intend to repay your mortgage early, the borrower needs to notify the bank about this with a statement. To avoid mistakes when making the last payment, it is recommended to check with your mortgage manager about all the details of early repayment. The bank employee will recalculate the remaining amount and determine the payment that will need to be made.
After paying the funds, the borrower needs to obtain a certificate from the bank confirming the termination of financial obligations and termination of the mortgage agreement. Next, all that remains is to remove the encumbrance from the apartment in Rosreestr.
If we are talking about refusal after divorce
Now let's look at the situation: is it possible to refuse a mortgage during a divorce? If the loan is taken out during marriage, both spouses become co-borrowers and bear identical responsibility. If a divorce occurs, disputes and questions always arise.
How couples work:
- They continue to pay the mortgage according to a verbal agreement. After the loan is repaid, the issue of division is resolved.
- They contact the bank to cancel their mortgage completely. The apartment is for sale, the loan is closed ahead of schedule.
- One of the borrowers leaves the mortgage. As a result, the borrower will be one person who will be responsible for the repayment.
There is no single algorithm for action in this situation; it all depends on the circumstances and intentions of the former spouses. Sometimes a matter has to be decided in court.
It happens that it is not possible to come to an agreement with the bank. He refuses to sell the apartment (the law does not oblige him to fulfill the borrower’s requests). Then all that remains is to go to court and prove your point of view, for example, with certificates of income, disability, if the reason is a decrease in income.
Bank notification about repayment
After the entire mortgage has been paid off, you need to go to the bank and apply for a mortgage release. The application must indicate:
- Full name of the applicant;
- address of the property;
- loan agreement number and amount;
- a request to remove the encumbrance in connection with the fulfillment of financial obligations and to issue a mortgage on the apartment.
The application is processed on average for about 14 days, after which the borrower is issued a mortgage and a letter confirming the removal of financial obligations from him. According to paragraph 2 of Art. 17 of the Federal Law “On Mortgage”, the lender is obliged to immediately return the mortgage to the borrower upon fulfillment of his obligations under the agreement.
Removal of encumbrance: independently or through intermediaries?
The whole procedure can take a lot of time. Collecting documents, waiting for the papers to be ready, visiting the bank and the registration authority - these stages of registration will require strength and patience. Those who do not want to waste time on paperwork can turn to lawyers or realtors who provide such services.
In order to close a loan agreement through intermediaries, you will need to issue a power of attorney from a notary.
Based on this document, the specialist will be able to represent the interests of the property owner in the bank and in the registration authority. He will prepare all the documents and carry out the necessary procedures to remove the encumbrance from the apartment.
Documentation
After receiving the papers from the bank, you need to go to Rosreestr at the location of the property and submit an application to remove the encumbrance. Along with the application you will need to provide the following documents :
- letter from the bank about fulfilled obligations;
- mortgage on an apartment with a note about the repayment of the loan;
- document confirming ownership of real estate;
- a copy of the loan agreement;
- owner's passport;
- check for payment of state duty;
- court decision (if the loan was repaid through the court);
- contract of sale.
Be careful when choosing your future property
When buying an apartment on the secondary market, there is a risk of purchasing housing with restrictions. In this case, the certificate of ownership may not have a mark on the existing encumbrance. Accordingly, there will be no mention of this in the purchase and sale agreement. Therefore, before registering a property, check its condition on the official website of Rosreestr or with its local representatives.
In cases where several restrictions are imposed on housing (this can happen if the borrower refuses to pay), getting rid of them will be quite problematic. Therefore, if the property you have chosen has encumbrances, it is better to refrain from purchasing it.
Statement
The application shall indicate the following information:
- Full name of the owner, his residential address.
- Address, name of the credit institution and its details.
- Information about the mortgage: bank agreement number, term, amount, grounds for termination of the agreement.
- A phrase about the absence of obligations both on the part of the bank and on the part of the borrower.
- Purpose of the statement.
The application is signed by both parties - the homeowner and the bank representative.
You will find a list of documents required to remove the encumbrance and information on further steps here.
State duty, cost of obtaining a re-certificate and other expenses
Removing the encumbrance in Rosreestr is a free procedure, but for making changes to the Unified State Register you will need to pay 200 rubles.
Additional possible costs:
- Submitting papers through intermediaries will cost an average of 2 to 5 thousand rubles.
- Plus registration of a power of attorney for an intermediary at a notary – 200 rubles. according to the tariff and about 1,500 thousand for drawing up the document.
- Obtaining a new certificate of ownership will cost 350 rubles. It is made at the request of the apartment owner.
When registering a mortgage and registering the transaction with the authorities, the owner is issued a certificate of real estate with a note that the apartment is pledged. After the mortgage is paid off, the owner can receive a new certificate without this mark.
FAQ
I was approved for a mortgage, but I changed my mind about taking it. Is it possible to refuse?
Yes, there won't be any problems. If the contract is not concluded, the transaction is not registered, the money is not transferred to the seller, you have no obligations.
Can a bank refuse to remove a co-borrower from the mortgage during a divorce?
Maybe. For a bank, two borrowers are better than one. If one stops paying, there is always a second one. Plus, it is easier to collect money in case of delay from two than from one. But the conclusion cannot be ruled out. It is important that the new primary borrower be solvent and have a good credit history.
Is it possible to refuse a mortgage after signing a loan agreement?
It is possible, but only if the seller has not yet received the money: it has not been transferred to the account, he has not taken it from the cell.
What to do if the transaction has already been registered with Rosreestr?
You can terminate the purchase and sale agreement with the seller and write to the bank an application to change the data in the Unified State Register (USR) (remove the imposed encumbrance). But this is only possible with the consent of the seller and if he has not yet received money from the bank.
The bank did not accept the mortgage waiver application, what should I do?
The only option is to go to court and try to initiate termination of the contract in court.
Sources:
- Domklik: How to terminate a mortgage deal.
about the author
Irina Rusanova - higher education at the International East European University in the direction of "Banking". Graduated with honors from the Russian Economic Institute named after G.V. Plekhanov with a major in Finance and Credit. Ten years of experience in leading Russian banks: Alfa-Bank, Renaissance Credit, Home Credit Bank, Delta Credit, ATB, Svyaznoy (closed). He is an analyst and expert of the Brobank service on banking and financial stability. [email protected]
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Contact Rosreestr
On the agreed day, the homeowner and the lender’s representative meet at Rosreestr and sign the application to remove the encumbrance on the property. If the borrower applies independently to the authorities, without the other party to the agreement, then he must present a power of attorney on behalf of the bank. The employee accepts the documents and issues a receipt indicating the date when you can appear for new papers. On the appointed day, the owner needs to pick up a new certificate. To do this, it is enough to present your passport and receipt.
What is the procedure for repaying a mortgage registration record and how to submit an application and documents to Rosreestr, read here, we talked about how the mortgage encumbrance is removed at the MFC, Rosreestr or through the State Services website.
Why is it necessary to remove the encumbrance from the apartment?
Having dealt with the question of how to rent an apartment as collateral after paying off the mortgage, it’s time to understand: what is this for? It would seem that the debt has been paid, there are no more obligations to the bank. So what are all these manipulations for?
The fact is that until the restrictions are lifted, the apartment remains secured by the lender. Those. It doesn’t matter at all that you have fulfilled your part of the contract, you still have no right to dispose of the property. Only after contacting Rosreestr with all the necessary documents and receiving confirmation of the removal of the encumbrance, you become the full owner of the property. Only after this can you sell or exchange housing, as well as rent it out. This is why it is necessary to immediately confirm the fact of full repayment of the mortgage to the state.
Possible difficulties
In order for the procedure to be quick and successful, the apartment owner should learn about some nuances and difficulties:
- You should not immediately contact the bank with an application for a mortgage immediately after making the last payment. Closing a loan agreement can take up to 1 month. It is best to start the procedure after 30 days from the date of loan repayment.
- Before making the last payment, it is recommended to request a certificate from the bank with the balance of the amount in order to know exactly how much to pay.
- When receiving papers from the bank, check their contents. All documents must bear the lender's seal and signature. According to clause 7 of Article 17 of the Federal Law “On Mortgages”, the mortgage note issued by the bank after repayment of the loan must contain o.
- If there is a small balance of mortgage debt after making the last payment, the bank will not release the mortgage on the apartment. Before receiving it, the borrower needs to fully repay the loan, even if it is just a couple of rubles.
- You should not delay the procedure. There are no fines for this, but it is better to resolve all issues as early as possible, otherwise you will have to restore all documents to the bank later.
Closing a mortgage agreement and removing the encumbrance from a home is a simple process, but it requires care from the borrower. First of all, he should make sure that he has no debts and that he has fulfilled his obligations to the bank in full.
How the procedure for mortgage lending with the participation of maternity capital is changing
If MK serves as a first installment, the borrower is required to provide a certificate and a certificate from the Pension Fund about the actual balance of the capital. The capital itself is transferred to the lending party after the conclusion of the purchase and sale transaction and settlements with the seller. To do this, after the transaction, the borrower applies to the Pension Fund with an application to transfer money to the banking institution.
Note! If MK is used as a down payment, the lender usually limits the period during which the capital must be at its disposal. But efficiency in this matter is more beneficial to the borrower. After all, before transferring MK to the bank, the debtor pays the loan in full.
