Mortgage for a garage, parking space or parking in 2021

A mortgage for a garage is quite rare among bank loans. However, in 2021, the parking problem for metropolitan residents is very acute. Many people would like to have a permanent place to store their car. Given the monthly payment for parking, taking a garage mortgage would be much more profitable. We will tell you further where such loans are issued and under what conditions.

Features of a garage mortgage

Despite the abundance of different banks and programs in them, buying a garage with a mortgage turns out to be a difficult task. The fact is that not everywhere there is a loan secured by a parking space or a separate building for a car. This is due to the low liquidity of such real estate. In case of non-payment of debt, it is almost impossible to sell the garage, so many banks do not even consider such collateral.

Only large lenders who are confident in debt repayment can afford to include a mortgage for a garage in their product line. But even in this case, banks minimize financial risks, as a result of which the loan parameters become not very profitable. In particular, clients should be prepared for the following conditions:

• the interest rate is higher than the average for a mortgage;
• large down payment, usually starting from 25% of the cost of the garage;
• a short payment period is calculated (5-10 years instead of the stated 20-30 years);
• requirement to provide additional security (property pledge or surety).

Is it possible to buy a garage with a mortgage
without a down payment? It is unlikely that at least one bank will be able to issue such a loan, because the transaction is already high-risk. If you do not have money for initial capital, consider the option of a simple consumer loan or a loan secured by other real estate.

If you intend to get a loan to purchase or build a garage, you should listen to the following recommendations:

1. Study the real estate market in advance, the prices and objects presented on it. It is best to do this taking into account the conditions of banks issuing a mortgage for a garage or parking space.
2. Be sure to clarify what types of collateral the lending institution will not be able to accept as collateral. Otherwise, you risk finding out that the collateral does not meet the bank’s requirements at the last moment.
3. Compare the conditions of banks that issue loans for the purchase of a garage. Pay attention to the final interest rate, because the site usually indicates its minimum value. Find out if there are additional fees and charges.
4. To increase your chances of approval, involve co-borrowers or guarantors in the transaction.

It is worth checking with the mortgage manager working with the loan application which option is suitable in your situation.

The mortgage amount for the purchase of a garage is calculated in the usual way. The final loan size depends on the solvency of the future borrower and the estimated value of the property. To increase it, the client can provide additional collateral in the form of an apartment or other property. Particular attention is paid to the liquidity of the object (that is, the potential opportunity to sell it). For example, no bank will agree to issue a loan secured by a dilapidated garage in a remote area.

Other flaws in documents

The initial documents necessary for registration of the construction are there, but they contain some inaccuracies, incorrect expressions, the garage was built with gross violations (underground communications are located below).

• City authorities often do not register a garage in such situations, and they end up filing a lawsuit.
• It is impossible to say in advance what certificates will be required for the court, and how difficult the trial itself will be; everything entirely depends on the current situation.

Registration of ownership of a garage through the court is not such a simple matter, but it is completely solvable. You have instructions and they will help you do everything correctly.

Collateral requirements

Each bank sets its own conditions on which you can buy a parking space with a mortgage. However, you should prepare for fairly strict requirements. It is recommended to first select a property, check it for compliance with the parameters stated by the bank, and only then submit a loan application.

For what purposes can a mortgage be granted:

• purchase of a ready-made garage;
• construction of a garage, including the simultaneous acquisition of land underneath it;
• mortgage for a parking space in a new building;
• acquisition of an already registered parking space.

Thus, a mortgage for the purchase of a car space can be issued for the purchase of a detached building (garage), which is often located on a designated plot of land owned or leased by the municipality. The parking space is located on the territory adjacent to the house or in the parking lot, and ownership rights to it are also issued.

Some banks offer a mortgage for the purchase of a parking space in addition to a loan for an apartment under construction. Thus, the borrower receives not only housing, but also his own parking space from the developer.

Pay special attention to the bank's requirements for collateral. As a rule, you can buy a garage with a mortgage if it meets the following conditions:

• all the documents required for registering the transaction in Rosreestr have been drawn up for the property (what exactly should be in place at the time of transfer of ownership should be clarified with a government department or bank);
• this is a capital structure, that is, having a foundation;
• is not in disrepair and does not have much wear and tear;
• does not stand in line for demolition or major repairs;
• allocated as a separate property;
• not mortgaged or encumbered by the rights of third parties (there is a similar requirement for a connected land plot).

Recommended article: Real estate valuation for mortgage in Sberbank - list of accredited appraisers, price, terms, procedure

A parking space can only be purchased with a mortgage if it is allocated as a separate object with clearly defined boundaries. If the ownership documents indicate shared ownership, the bank will not take the parking space as collateral. It is worth noting that many old garages are not properly registered (for example, a cadastral passport has not been received or there is no title), such objects are not accepted as collateral.

The mortgage collateral for a parking space or garage remains in the use of the borrower. However, the presence of an encumbrance imposes significant restrictions on real estate. The pledged property cannot be sold, donated or leased (). In addition, it is subject to compulsory insurance throughout the loan repayment period, with the exception of the associated land plot ().

How to register a garage purchased without documents

Often the owners of a non-privatized garage need to register it. This is done to officially dispose of it:

• sell;
• give;
• lend it for temporary use.

The easiest way to legalize a garage is located in a cooperative. The main thing is that the owner pays the full amount of the share contribution in advance. To decorate a garage space, the following steps go through:

• Receipt of a document confirming full payment of the contribution.
• Drawing up a certificate confirming that the share is transferred to the cooperative. Before this, you will have to organize a meeting with all members of the cooperative to obtain their consent.
• Obtaining written confirmation from the head that the land is transferred to the cooperative.
• Carrying out measurements of the land plot and its characteristics for the legal registration of a car garage.
• Preparation of necessary papers for subsequent registration of real estate.

Package of documents

At the first stage of consideration of a loan application, the client must provide a standard package of documents. It includes a passport, a completed application form, a salary certificate () and a copy of the work record book. If necessary, the credit institution may request other papers (for example, SNILS, pension certificate, military ID, etc.). If a co-borrower or guarantor is involved in the credit transaction, similar documents will be required from them.

Is it possible to buy a garage with a mortgage
using two documents? Of course, if, according to the bank’s conditions, it is not necessary to confirm income and employment. But it is worth considering that with simplified lending the interest rate is higher than the base rate.

After approval of the loan application and calculation of the possible amount, you should collect a package of documents for the purchased property:

• an extract from the state register confirming ownership and absence of restrictions;
• technical documentation, including cadastral passport;
• evaluation report;
• seller's passport;
• document establishing the right to own property;
• draft purchase agreement.

Depending on the situation, other documents may be required. If you simultaneously purchase a plot of land or mortgage your own real estate, a similar package of documents is collected for them. With the exception of the appraisal report for land, its value is calculated in conjunction with the building standing on it.

Is it possible to get a mortgage for a garage that is just planned to be built? Yes, in this case you should provide an estimate for work and materials. Construction can be carried out on an existing land plot, owned or leased. It is also necessary to collect a package of papers for the land, because it will automatically go as collateral ().

What to do if there are no documents?

As a rule, a plot of land was allocated to a garage cooperative by the municipal authorities under a lease agreement. Then the appropriate construction permit is obtained. Therefore, first you need to request these documents from the chairman of the GSK.

In many cases, quite a lot of time has passed and the documents may simply be lost or not preserved. In their absence, restoration will be required with the relevant requests being submitted to the municipality. This process is quite time-consuming, so registering property rights can take quite a long time.

The procedure is long, but not hopeless. Most often, you can achieve recognition of rights to such a structure in court, where you will need to provide a technical passport of the garage, as well as prove that:

• built at the expense of the applicant (provide estimates or an agreement with a construction company);
• the rights of other persons are not infringed;
• there is a building permit. If this is not the case, the court may declare the construction illegal and demand its demolition.

Transaction procedure

Where exactly a mortgage is issued for a parking lot or garage and under what conditions, we will tell you in the following sections. First you need to understand the procedure for completing a transaction. It is carried out in several stages:

1. Choose a suitable bank and carefully read the loan program. Pay attention to the interest rate, requirements for the borrower and collateral, package of documents, additional costs, etc.
2. Collect the paperwork required to complete your loan application and submit it to the bank for review.
3. If the decision is positive, you should start looking for a garage or parking space. But, as a rule, borrowers apply to the bank for a mortgage for parking in a specific location that has already been selected. Moreover, there are not many offers on the real estate market, and while searching for a suitable option, the loan approval period may expire.
4. Collect a package of documents for the property. A list of papers can be obtained from the bank’s website, but it is better to contact a mortgage manager. He will be able to clarify exactly what documents will be required in your case.
5. Papers for the loaned and collateral real estate are submitted to the lender for consideration. If there are no comments, you can enter into a deal.
6. The first installment is transferred, which is confirmed by a receipt, payment order or corresponding inscription in the agreement between the parties. Loan and collateral documentation and an agreement between the seller and the buyer are signed. All papers are sent for registration to Rosreestr.
7. The completed documents for the new owner of the property (the borrower) are sent to the bank, after which loan funds are issued. The money is transferred to the seller's account. From this moment the mortgage transaction is considered completed, the client will have to repay the loan monthly.

Recommended article: What documents are needed for a mortgage at Rosselkhozbank

How to repay the loan?

To repay a loan, you can use the following methods:

• Automatic debiting of funds from the account of an enterprise or company. The borrower will have to write an application to transfer part of his salary to the bank account. After this, the Sberbank client needs to issue an order to write off funds from the card account.
• Transferring money from a current account. An additional agreement is required that will allow the bank to write off funds to repay loan obligations.
• Depositing cash into a bank cash desk.

Banknotes are accepted not only by cashiers, but also by ATMs. To deposit funds, you can also use information and payment terminals equipped with a deposit module.

Mortgage for a garage from Sberbank

A mortgage for a garage at Sberbank was suspended for some time, but in 2021 it is available for registration. The country's largest lender issues loans for the purchase of a parking space, construction or purchase of a separate garage. The bank's requirements for borrowers are standard (age from 21 to 75 years, Russian citizenship and registration).

Under what conditions can you buy:

• the amount is calculated individually, but cannot exceed 75% of the value of the collateral;
• payment period up to 30 years;
• down payment from 25%;
• interest rate from 9.7%;
• for loans up to 1.5 million rubles, you can do without collateral, providing only a guarantee;
• the loan can be provided in a lump sum (for purchase) or in tranches (for construction).

It is worth noting that Sberbank is the only lender that issues a mortgage for the construction of a garage on its land. For example, when you want to build a major garage at your dacha on your own or with the help of a contractor. True, in this case the bank will take as collateral the land and all the buildings located on it (if there is no other property being pledged).

The spouse of the borrower on a mortgage for a parking space in Sberbank and other banks necessarily becomes a co-borrower, because the property is acquired as joint ownership (). If there is a marriage contract, he can become a guarantor.

The garage mortgage calculator at Sberbank will help you make a preliminary calculation of the interest rate and monthly payment. It is located on the credit company’s website and in the DomClick service. The portal is designed to fill out an application, search for a property and further monitor the mortgage transaction. Immediately after the calculation you can . The package of documents for the borrower and the collateral is similar to the above.

Loan for a garage in Rosbank

There is a targeted mortgage program for the purchase of a garage. I must say that the bank offers quite attractive conditions. However, the loan is only available as an addition to your home mortgage. You can purchase a ready-made garage (with the exception of garage cooperatives) or a parking space in a new building from an accredited developer.

Terms of a mortgage loan at Rosbank:

• interest rate from 6.69%;
• amount from 300 thousand to 3 million rubles;
• down payment from 25%;
• repayment period up to 25 years.

Citizens of any state aged 20 to 65 who have a permanent place of work in Russia will be able to apply for a mortgage. To increase the possible amount, you can attract up to 3 co-borrowers. The list of documents from the borrower () and the seller is standard.

Loan interest rates

This mortgage has an interest rate of 10.6%
per annum. The rate applies to clients who have an open account or salary card with Sberbank. When drawing up a loan agreement, the bank offers to take out a life and health insurance policy. Please remember that this service is voluntary. However, in case of refusal to issue a policy, the interest rate on the loan will be increased by 1%.

Possible allowances:

• +0.3%. – if the client does not have a Sberbank salary card;
• + 1% – if you refuse to take out insurance for the borrower;
• +1% – for the period until the registration of the transaction for registration of collateral is completed.

Registration of this mortgage program is more profitable than non-targeted lending due to a lower interest rate, as well as simplified conditions.

Mortgage in DOM.RF

Is it possible to buy a parking space with a mortgage under the DOM.RF program? This type of loan is provided by the mortgage agency. It applies to a finished or under construction property located in a house or garage complex.

The terms of DOM.RF may well compete with Sberbank’s mortgage program for parking:

• interest rate from 8.5%;
• amount up to 3.5 million rubles;
• payment period up to 30 years;
• down payment from 15%.

If desired, the client will be able to provide a minimum package of documents, but the conditions will become slightly worse. The interest rate will be calculated from 10.4%, and the smallest down payment increases to 35%. The remaining requirements for borrowers remain the same (Russian citizenship and registration, age from 21 to 65 years, income and permanent place of work). You can submit an application on the website in real time, and here you can also make preliminary loan calculations.

Which bank is better

When planning to purchase a parking space or garage with a mortgage, an individual must first choose a financial institution for cooperation. To do this, it is necessary to conduct research on the local credit sector and compile a rating of banks. When choosing a lender, vehicle owners should focus on reliability, as well as on the terms offered to them.

Currently, only three credit institutions operate under this special program. If we compare Sberbank, Deltacredit and Absalutbank, then we can say that Sberbank will be more attractive among other banks for the reason that the loan term is up to 30 years, there are discounts for salary earners and you can take into account additional income without confirming it. And, in general, Sberbank mortgages are very popular in the country.

Attention! When studying the mortgage programs offered to individuals, it is necessary to pay attention to the following indicators: the amount of the down payment, the interest rate, the maximum loan amount, and the loan term.

Loan for a parking space at Absolut Bank

Is it possible to get a mortgage for a parking space from other banks? Offers interesting lending conditions. The mortgage program for the purchase of a parking space allows you to apply for a loan here on the following terms:

• interest rate from 11.49%;
• repayment period up to 10 years;
• amount from 100 thousand to 2 million rubles;
• down payment from 20%.

The loaned object can be a parking space located in a house or a special complex. If you want to purchase parking in a new building, you should contact bank-accredited developers.

Is it possible to get a parking lot on a mortgage from Absolut Bank using two documents? Yes, there is such an opportunity, the client only needs to provide a passport and a completed form. True, loan terms will become less attractive. In other cases, a certificate of income () and proof of employment will be required.

You can submit an application on the bank’s website and at its office. To increase the loan amount, you can attract up to 4 co-borrowers. Basic requirements for loan recipients: Russian citizenship, age over 21, permanent income and place of work.

Is there a mortgage for a garage at VTB

Car owners would like to apply for it, because many Russians receive their salaries on their cards. This means that you could count on preferential loan terms. Unfortunately, VTB does not provide a mortgage for a garage.

Although VTB does not issue mortgages for garages, regular customers can take advantage of non-targeted lending secured by other real estate under the following conditions:

• amount up to 15 million rubles;
• interest rate from 10.9%;
• payment period up to 20 years;
• Only an apartment can serve as security.

This program can be a completely acceptable alternative to a mortgage for a parking space at VTB. Many banks have similar non-targeted loans. The rate on them is lower than a regular consumer loan, but higher than a mortgage.

Tax deduction when receiving a loan

A citizen who has taken out a mortgage loan under the “Garage or Parking Space” program has the right to receive a tax deduction. Its size is determined by the personal income tax rate and the amount of interest paid. The maximum amount that a borrower can receive from the state is 260 thousand rubles. Refunds are available only to citizens who have not previously received a tax deduction. Borrowers who took out a mortgage before January 1, 2008 are entitled to receive 130 thousand rubles.

Other options for purchasing a garage on credit

Unfortunately, it is not possible to get a targeted loan for the purchase of a garage at every bank. But there are other ways to get the required amount, for example, taking out a consumer loan. Moreover, it can be issued at a very reasonable rate.

If you don’t have your own savings, you won’t be able to get a mortgage for a garage without a down payment. Then consumer lending or secured by existing real estate is the only way out. However, in the second case, the same costs will arise for the preparation of collateral documentation (appraisal report, state duty, etc.).

For a small amount, taking out a loan for personal needs can be even more profitable:

1. You won’t have to burden the purchased garage or parking space. If necessary, you can sell it at any time.
2. There will be no need to order an appraisal report and purchase a collateral insurance policy every year. By reducing costs, the high interest rate compared to a mortgage is compensated.
3. You can purchase any garage you like without relying on bank requirements.
4. The purchase and sale transaction will be faster and easier, saving a lot of time for both parties.

For example, at Gazprombank, a mortgage for a garage is not available even to regular customers. But they can get a consumer loan here for any purpose at a rate of 7.5% per annum. This option is even more attractive than a mortgage. If you wish, you can find many interesting cash loan programs, but it is best to contact the bank where you have your salary card. By receiving preferential loan terms, you can seriously save on interest overpayments.

Banks that issue mortgages for garages, parking lots and parking spaces.

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Author:

Mortgage specialist Maria Yurievna Sokhan

Publication date February 10, 2020 June 10, 2021