Mortgage and children. Minor owners.

Author of the article

Yuri Karlovich Pilchevsky

Reading time: 5 minutes

Material updates: 2019-05-03 12:50:52

Many people planning to purchase real estate are wondering: is it allowed to purchase an apartment with registered minor children? What is needed for this and what is the procedure? What pitfalls await you on the way to a deal and what should you be wary of? According to Russian legislation, the sale of an apartment with children registered in it is permitted, but subject to a number of conditions that will be discussed in detail in this article.

Rights of minor children to an apartment

The rights of minor children to residential premises are protected by Russian legislation.
This leads to restrictions on the opportunities provided by mortgage lending. Mortgage banks do not take property owned by minors as collateral. This means that in order to take out a mortgage loan secured by an existing residential property, its owner must not be a minor. You cannot use an existing residential property as a down payment if the owner is a child or even if he is simply registered in this premises.

To ensure that the child does not lose his property irretrievably, the guardianship and trusteeship authorities exercise control. It is these bodies that give permission to conduct transactions with real estate (if its owner is a minor).

If a child only has a registration in the residential premises being sold, then there is an option to re-register him with someone close to him - until the moment of resale.

If the child is the owner of the residential premises being sold, then the guardianship authorities may issue permission to allocate the minor’s share of the property in the new residential premises (after the mortgage loan is repaid. You can find out whether it is worth paying off the mortgage early here).

There is another, more complicated way - exchanging shares of property with a relative. Thus, the child will have a share of ownership in the apartment of his grandfather, grandmother, and so on (in this case, only adults will be the owners of the apartment being sold). In this case, it is worth considering that this option is only possible if the new share is no smaller in size.

There is another way - if there are no accommodating relatives: this is the sale of existing housing, the purchase of something small. In this case, a mortgage loan is not taken out (the child is provided with the necessary own space). The remaining difference from the sale is used as a down payment to obtain a mortgage.

All these nuances do not in any way relate to the issue of child registration in residential premises (if it was purchased with a mortgage loan). Registration of a child in such an area is allowed without problems.

There are also positive factors in the “mortgage – children” connection. When the second and subsequent children are born, the parents become the owners of maternity capital. It can be used to pay off a mortgage loan (or as a down payment to obtain one). And Sberbank’s “Young Family” program says that upon the birth of a child, the borrower can be given a deferment in repaying the main debt or the loan term can be extended (until the child is three years old).

Risks of buying a home with minor children

For the buyer, such a purchase is associated with the risk of challenging the transaction in court.
If the court finds that the property interests of children have been violated, the purchase and sale agreement will be canceled and the parties will return to the starting point: ownership of the apartment will pass to the buyer.

Certain risks are associated with apartments acquired through privatization. In this case, the buyer should carefully analyze the extract from the house register. If at the time of privatization a minor child was registered there, but was not included in the ownership, then his rights were violated. In such an apartment, a child can retain the right of unlimited use if he goes to court.

Obviously, one should refrain from concluding such a deal. The exception is situations where the refusal to privatize a child has received the approval of the guardianship authorities, but the possibility of such a combination of circumstances is minimal.

Also, controversial issues may arise if the child was discharged from the apartment shortly before privatization or was temporarily discharged from it while this procedure was in progress.

He can also restore his violated rights through the court.

There are some risks associated with buying an apartment with two minors. If this property was purchased using maternity capital, then the parents were required to include children among its owners.

If parents ignored this requirement, they also violated the property rights of their children. The main problem is that the issue of allocating shares when using maternal capital is poorly monitored.

Child and mortgage

The child itself will not change anything - the bank, when making a decision on issuing a mortgage loan, does not divide clients into “children” and “childless”. The bank only tracks the borrower's income level. It’s a different matter if the family already owns an apartment, upon the sale of which it will be possible to make a down payment.

If a minor lives in this residential premises as a member of the owner’s family (that is, has a regular residence permit), then you can buy, sell and pledge the acquired property as usual. It’s another matter if the child is the owner of the apartment or a share in it. Then the real difficulties begin.

If the apartment is inherited

You were unlucky. And this is only partly a joke. Buying such housing is risky, especially if three years have not passed since the date of inheritance. After the statute of limitations expires, the likelihood of possible surprises is noticeably reduced, but not reduced to zero. A forgotten relative can drop out of the blue at any moment, report that he did not know about the opening of the inheritance and declare his rights to the apartment that you have long considered yours. You should not discount another category of heirs - those who are entitled to an obligatory share, even if the property is bequeathed to another person.

Protecting the child as an owner

A transaction involving a minor is complex, as there is a conflict between banking interests and the guardianship authorities. To sell an apartment, the share of which belongs to a child in accordance with an article of the Civil Code of the Russian Federation, it is necessary to obtain permission from the guardianship authorities. Basically, the rights of minors are protected by departments of the district administration or other divisions of local self-government bodies.

To obtain their consent, it is necessary to collect certain documents:

Parental passports
Marriage certificates
Birth certificates of children
Title documents for both apartments being sold and purchased
Certificates of estimated value and cadastral passports

If the child is already 14 years old, his consent to conduct this transaction is also required. This package of documents is sometimes much larger than the package required to complete the purchase and sale transaction itself.

But even after this, the guardianship authorities may refuse to carry out the transaction. After all, according to common sense, if an unencumbered one-room apartment is exchanged for a more spacious one, but mortgaged to the bank, this can also be regarded as a deterioration in the child’s living conditions. A default can always happen, and the child will remain on the street, and the guardianship authorities have no right to allow this. Municipal employees, as a rule, are sensible people and should understand that a small risk in this case is justified - otherwise the family is unlikely to ever be able to move into a normal apartment. Therefore, most often consent is still given.

“A lot depends on the type of permission issued by the guardianship authorities. The result is also influenced by the quality of preparation for the meeting with municipal authorities, as well as the specific district, specialist and even the application form,” says the general director

"First Mortgage Agency", Maxim Eltsov. Permissions vary. The first provides the option of allocating a new share of the property to the child after the mortgage is paid off. The second permit requires this to be done immediately, at the moment when the purchase and sale agreement is concluded. The first method is more convenient, as the bank will issue a mortgage loan sooner. But the second method, according to Maxim Eltsov, is used much more often.

What will the other half say?

If the seller is married and the apartment is joint property with the spouse, it cannot be sold without the notarized consent of the latter. Often, real estate belongs to both spouses, even if they are divorced. In such cases, it is also necessary to obtain the consent of the second of the couple. Now imagine how easily a person can “lose” a passport and get a new one - clean, without stamps. Who will confirm that there is no marriage or divorce behind him? Where is the guarantee that after buying a home his ex-wife will not come and demand her share through the court? The ideal option is if the owner is married to the person with whom the home was purchased together, and the spouses are unanimous in their desire to sell it.

Banks are against this development of events

Because of the second option, problems arise with banks. Many people refuse to accept residential premises as collateral if one of the owners is a child. “We do not allocate the share due to minor children. This is only because it is impossible to be responsible and allocate a share to a minor in the event that his parents, bank borrowers, suddenly do not service their mortgage loan (and the apartment is sold),” this was the answer given by the head of the mortgage center of the St. Petersburg branch "Promsvyazbank", Alexander Zhestkov. Credit organizations behave cautiously, because, as current Russian legislation states, if the borrower defaults, selling an apartment with a child’s share will be a very difficult process.

The problem is solved by excluding from the pledge scheme real estate owned by a minor. For example, other real estate can become collateral if the family has one. There is an option with a consumer loan for additional payment when exchanging housing. But such a loan is smaller than a mortgage. And it is more expensive - approximately 18-22% per annum versus 12-14% for a housing loan.

There is also this option: if the size and price of the premises allow, then you can sell it and buy a small house in the name of the child. The difference in this case is the down payment. At the same time, the child’s share should not decrease. The purchased property can be rented out - rental payments will cover some of the costs of servicing the mortgage loan.

Finally, the child can receive his own share in other real estate. This could be an apartment or a grandparent's house. The guardianship authorities will give consent to the sale of housing if relatives give the child a share in their apartment. In such a situation, it is possible to obtain a mortgage loan secured by a new home, in which the child will no longer be the owner.

This is a scary word - realtor

You find an interesting apartment option from the owner and arrange a viewing. An intermediary appears at the meeting, introducing himself as a friend/relative/colleague of the owner. He explains that the owner of the property is away and has instructed him to lead the sale. He refuses to show the power of attorney without a preliminary deposit. Some realtors act exactly like this - they pretend to be someone other than who they are, they are obnoxious and playful. Run away from these guys. At best, they will get their hands on your deal for an unauthorized 300-400 thousand rubles. The worst option is not even worth considering.

Minimize risks

What buyer would not want to find the apartment of his dreams - suitable in terms of characteristics and price, with a single (adult and legally capable) owner who has owned the property since its construction. Reality, alas, forces us to come down to earth. Finding a home with an impeccably clean history is a quest for the persistent and lucky. Therefore, there is nothing left to do but keep your eyes open, listen to your inner voice and follow a number of rules:

refuse the apartment if three years have not passed since the last transfer of ownership;
reject proxy sales options;
pass by if the property price is noticeably lower than the market price;
continue the search if you encounter several warning signs at once: a large number of household members, children registered in the apartment, disabled people or relatives who have left in an unknown direction;
comprehensively check the owner of the property and the history of the apartment;
record the fact of the seller’s legal capacity on the day the contract is concluded;
have the transaction certified by a notary;
Take out title insurance for at least 4 years after purchase, and preferably 7 or even 10 years.

And be sure to believe that you will find an apartment that you can buy without hesitation or fear. Spare no time and effort - they will more than pay off in stability and peace of mind.

Apartment history: dig deeper

To understand how reliable the option you have chosen is, ask the owner to make a request for an extended extract from the Unified State Register. This document will reflect all the events that have occurred with the object over the past 20 years. It is important for you to find out if there are any dark spots in the apartment’s past, such as:

dubious transactions, especially involving state-owned enterprises and legal entities;
frequent resales with changes of owners;
litigation;
the fact of being under arrest or pledged by the bank.

If it turns out that the apartment has encumbrances or was recently at the epicenter of a conflict, you should think twice about whether to deal with it. The regular transfer of real estate from hand to hand is a red flag for the buyer. Such actions clearly reveal a fraudulent sales scheme using fake documents.