What documents are needed to obtain a mortgage?
Mortgage approval occurs in two stages. First, the bank calculates your creditworthiness. To do this, you need to fill out a form and attach scanned copies of supporting documents. Then you find a property and submit a set of documents for it for consideration. After approval, the deal can be concluded.
The list of required documents will differ depending on:
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Citizenship. Alfa-Bank provides loans to citizens of the Russian Federation, Ukraine and the Republic of Belarus. Foreign citizens, in addition to an identification document, must present to the bank proof of legal stay in Russia. Their list is approved by law, for example, migration card, residence permit and others.
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Type of your employment. For employees, standard proof of employment and income is required. For business owners, individual entrepreneurs, notaries and lawyers, the kit will be different.
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The presence or absence of co-borrowers. Their income may be included in the calculation of the maximum possible lending limit. In this case, the co-borrower provides the same set of documents as the main applicant. If the co-borrower’s income is not taken into account (for example, a non-working spouse), then only a passport is required.
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Selected mortgage program. Thus, you can purchase a new building or secondary housing with an increase in the interest rate by 0.5%, by presenting only a passport. To refinance a mortgage from another bank, you will need a complete set of documents.
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Type of object: housing completed or not. When purchasing a secondary home, you will need an extended set of documents and an assessment report.
Additional documents
Depending on the type of mortgage loan, clients of a banking institution, in addition to basic documents, will need additional ones. These could be various social programs, mortgages for privileged categories of the population.
The package of documents for primary and secondary housing also differs.
Mortgage for maternity capital
Maternity capital in the Russian Federation is issued after the birth of the second child and all subsequent children. In 2021 it is just over 400 and a half thousand rubles. This amount can be accepted as a down payment on a mortgage loan. Only the certificate holder will be able to receive credit funds. If the mortgage amount is more than 200 thousand rubles, then a guarantee from the second spouse is required.
In addition to the main package of documents, families wishing to take out a mortgage using maternity capital provide a certificate and an extract from the pension fund on the balance of funds in its account. The Pension Fund must give permission to use maternity capital as a mortgage contribution. Additionally, the bank may request birth certificates for all children, as well as marriage/nuptial agreements.
Mortgage without proof of income
Issuing a mortgage loan without proof of income assumes that the borrower is working informally or owns property that can be provided as collateral. The client announces his income orally, and in addition to his passport as a citizen of the Russian Federation, he must bring one of the following documents to the bank: international passport, driver’s or pensioner’s license, military ID. You will also need papers confirming ownership of an apartment, dacha, vehicle, and securities.
If the borrower works as a freelancer or sells any products through Internet portals, then bank employees may ask him to present statements about the receipt of funds to his bank account or card.
Individual entrepreneurs provide a tax return. If a person is a client of a banking institution that issues a mortgage, then credit managers can independently check the movement of funds in his account.
Mortgage for a young family
To participate in the program for young families, one of the parents must be no more than 35 years old and no less than 21 years old. It is better that both spouses meet this criterion. A family must have one or more children. A single mother or father with children will also be considered a young family.
Young parents provide the bank with the following additional documents: marriage and birth (adoption) certificates for all children, papers for collateral property. You will also need certificates confirming the fact that the family has money for a down payment (for example, Sberbank offers to pay at least 15-20% of the mortgage amount). This could be a bank account statement, a certificate for maternity capital, etc. If relatives of a young couple act as guarantors, then documents indicating the relationship are required.
Military mortgage
To participate in the Military Mortgage program, a serviceman must first submit a report of desire to join it
. He brings the received certificate of participation to the bank along with the main package of documents. The military spouse must agree in advance to participate in the program.
Employees of a banking institution can additionally request information about education, availability of apartments, cars, land plots, and additional income. The serviceman also gives written consent to the processing of his data. Difficulties in this regard may arise for secret service employees. Military personnel serving under contract bring a certified copy of it.
Preferential categories
Some banks issue mortgage loans on preferential terms to doctors, teachers, and scientists. Absolutely all representatives of these professions do not fall under these criteria. Their list can be checked with managers of financial institutions. If the borrower meets all the criteria, then he additionally brings to the bank
:
- Application for participation in the social lending program, the procedure for which is specified in the statute of the financial institution.
- Copies of documents confirming relevant qualifications.
- Marriage/divorce certificate.
- Consent to the processing of personal data.
- Birth certificates of children.
- Autobiography with photos (4x6).
- A photocopy of a diploma of higher education and subsequent advanced training courses, graduate school, residency.
- Characteristics from the place of work.
- Information about writing scientific papers, conducting research, publishing in scientific professional publications.
This is the maximum list of additional documents for preferential categories; it may differ in different banking institutions. Also, at reduced interest rates, mortgage loans can be issued to employees of the Ministry of Internal Affairs, lawyers, and notaries.
They bring documents (certificates, certificates) confirming their belonging to the profession.
Documents for secondary housing
Regardless of the program under which the buyer takes out a mortgage (military, for maternity capital, etc.), the list of documents for the purchase of secondary housing is the same for everyone. When concluding a transaction, you should pay attention to the presence of minor children or disabled people in the seller’s family who are registered in the apartment. Without the permission of the board of trustees, the transaction cannot be completed until the specified persons register at a different address.
The first step is to check whether the seller has documents confirming ownership of the property. Next, you need to carefully study the documents on the basis of which the seller became the owner (donation agreement, purchase and sale agreement, entry into inheritance). All dates, numbers, passport details must match. You need to pay attention to the mental and physical health of the seller. If a person is elderly or shows signs of inappropriate behavior, then it is advisable to request a certificate of his legal capacity. If there are several owners of the property, then all the documents must be checked, and when concluding the transaction, they must all be present in person, or one of them can act by proxy.
An extract from the house register or a certificate about the residents registered in the apartment or house is required. Before concluding a transaction, they must all be deregistered at this address.
The certificate must indicate the grounds for discharge.
A mandatory document is a certificate (copy of a personal account) confirming the absence of debts on utility bills, or their presence if the buyer agrees to purchase an apartment with debts.
The seller is required to provide certificates from the BTI with a plan of the house or apartment, which includes a housing assessment. Here it is important to pay attention to the absence of illegal redevelopment. If there is no technical passport, then BTI is also involved in its production. The technical passport is included in the list of required documents. Also, a market assessment of the value of real estate should be carried out by an independent expert. A list of organizations that provide such a service can be found at a banking institution, since the bank does not trust all companies.
You also need a cadastral passport, which determines the percentage of depreciation of the housing stock. The bank may refuse to issue a mortgage for an apartment, the depreciation of which will exceed 60% at the time of full repayment of the loan. If a private house is purchased, then a cadastral number must be issued for the plot. When selling, you need an extract with a cadastral number.
A certificate from the Unified State Register stating that the seller’s property has not been seized and is not pledged is required. You should try to check this aspect through all channels. There have been cases when the seller provided a false certificate.
The last important document is the consent of the second spouse to sell the house or apartment if the housing was purchased after marriage. If the seller is not married, then he must take a certificate of this or bring a copy of the divorce certificate.
Sometimes additional documents are required that are not listed in this section.
You can learn about all the nuances in advance from the notary who will conduct the transaction, and from the bank.
Documents for housing under construction
Purchasing housing under construction requires a much smaller package of documents than secondary housing. This is due to the fact that the building has no wear and tear, no one can be registered in the apartment, illegal redevelopment is impossible, etc. It is best to take out a mortgage on apartments from developers who cooperate with the chosen financial organization. In many banks, credit managers themselves will offer options for purchasing apartments in new buildings. By choosing one of them, you can avoid red tape with the developer’s documents.
If the borrower has found a developer on his own, he brings the following documents
:
- Agreement with the developer for participation in construction or investment.
- Documents for real estate under construction: plan, cadastral passport.
- Expert assessment of an apartment in a new building. It will depend on the area of the city, materials, and infrastructure development.
- Confirmation of building permit. These papers are provided by the developer. This includes a document confirming the lease or ownership of a plot of land, permission to build in a specified location, etc. Additionally, the information is checked by the bank's security service, since during the construction process sometimes the developer's property is seized, or residents of the surrounding areas, environmental services or other organizations begin to protest against the construction of the house.
- Additionally, you can bring an insurance contract for housing under construction, but it can also be concluded at a bank.
For what period is it more profitable to take out a mortgage?
At Alfa-Bank you can get a mortgage for a period from 3 to 30 years. The shorter the term, the larger the monthly payment, while the total amount of overpayment is less. And vice versa. A mortgage loan is issued for a long period, and it is impossible to accurately calculate what will happen during this time. If you enter into a contract for a short period of time, a payment that seems convenient today may soon turn out to be unaffordable. Consider the risk of delay: you should not set the payment amount to be a large part of your income. We recommend choosing a longer term when applying for a loan so that the monthly payment amount is comfortable for you in any situation. If possible, pay the amount in excess and record early repayment of the loan to reduce the overpayment. You can do this for free in the bank's mobile application.
Seller's risks
Give more than you receive
For some reason, the apartment purchase and sale transaction was declared invalid. The seller receives his property back, and in return the money received from its sale is returned to him.
If the transaction was concluded with an inflated cost of housing, then the seller will be obliged to give the buyer not the amount that he actually received, but precisely the amount specified in the purchase and sale agreement.
You will waste time if the buyer is refused a mortgage
It often happens that the bank gives a loan in the amount of 80-90% of the market value indicated in the appraisal report. That is, in order to receive the full amount, you will have to negotiate with the appraisers. Appraisers accredited by the bank will not do this.
Or the bank may not approve the mortgage at all. In any case, the seller must patiently wait for the result of negotiations between the borrower and the lender, because the parties to the transaction have already signed a preliminary purchase and sale agreement.
Become an accomplice to fraud
Selling an apartment at an inflated price is essentially defrauding the bank. By participating in such a transaction, one cannot remain uninvolved in a fraudulent scheme. The seller of real estate, just like the buyer, is responsible before the law.
And the law states that you cannot provide knowingly false information to the bank. If the lender discovers a violation, both parties to the transaction will have to pay a large fine. Moreover, the seller and buyer can receive a real term.
Pay more taxes
The amount of home sales tax depends on how many years the seller has owned the property. If this period is less than 3 or 5 years, then you will have to pay personal income tax of 13%, taking into account the amount that was specified in the purchase and sale agreement.
That is, the seller will pay tax on money that he did not actually receive. The buyer, on the contrary, will save money, as he will be able to return 13% of this amount after registering ownership of the apartment.
Why do you need a down payment?
The down payment is your own funds, which are made to conclude a transaction for the purchase of real estate and are transferred to the seller. The presence of own funds proves to the bank that the borrower is solvent, reliable and capable of competently managing finances. The minimum amount is indicated in the lending program and ranges from 10%-15% (for apartments) to 50% (for a private house) of the cost of housing. There is no maximum threshold; it is only important that the loan amount is at least 600,000 rubles.
The larger the down payment, the lower the monthly payment and the higher the likelihood of loan approval. Maternity capital can be used simultaneously with your own savings or instead of them. To use it, indicate your desire to apply the state support measure in the mortgage application form, attaching a certificate of the balance of available funds. After concluding the transaction, go to a convenient bank branch, having with you:
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Passport;
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SNILS;
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Certificate for maternal capital;
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Real estate purchase agreement;
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Loan agreement.
Inflating the cost of an apartment with a mortgage
Mortgages that inflate the cost of an apartment attract borrowers who are unable to pay the down payment. The overpriced scheme allows you to obtain a loan on more favorable terms.
The essence of an overpriced mortgage: the buyer agrees with the seller to increase the cost of the apartment under the purchase and sale agreement. The amount is inflated by the amount of the down payment on the mortgage. The borrower uses the difference for his own purposes, usually making the first loan payment to the bank.
After registering the transaction, the bank pays the seller the remaining amount, that is, the real cost of the apartment. This scheme is illegal and is associated with certain risks for the buyer and seller.
Why do they inflate the value of real estate with a mortgage?
Overpriced mortgages attract borrowers for various reasons. The main motive is there is no money for a down payment. And someone wants to use the difference between the fictitious and real cost of housing for other purposes.
Other reasons for overpricing:
- make repairs in the apartment;
- pay off utility debts;
- spend on current expenses.
The difference between the real and actual cost is spent on the down payment. Photo: primeni.ru
Mortgage by passport
For clients who receive salaries into Alfa-Bank accounts, a mortgage is available with a minimum package of one document - a passport of a citizen of the Russian Federation:
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Russian Federation passport;
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SNILS;
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Military ID (for men under 27 years old).
A mortgage loan can be obtained under any program: new building, secondary housing, refinancing, buying a house with a plot.
Buyer's risks
They will refuse a mortgage and blacklist you
Fraud in documents by inflating the cost of an apartment can be detected even at the stage of reviewing the debt agreement at the bank. Financial and credit organization specialists have experience in such matters.
For example, bank employees will be able to detect false data when comparing the cadastral and market values of real estate. In this case, the borrower will not only be denied a loan, but will also be blacklisted.
The seller will not give back the overstated amount
The entire amount under the housing purchase and sale agreement with a mortgage is transferred by the bank to the seller’s account. Including the amount by which the value of the property was inflated.
An unscrupulous seller may not return the “extra” money. In this case, the buyer will not prove in any way that the seller owes him any money.
Criminal liability for fraud
The borrower may find himself in a situation where mortgage payments become unaffordable. Sooner or later, the bank initiates loan repayment.
Then the fact that the borrower provided deliberately false documents will inevitably be revealed. For such violations, the borrower will face punishment up to and including the opening of a criminal case.
Revealing false information when submitting documents to the bank threatens the borrower with legal action.
Mortgage with a full package of documents
In most cases, in order to receive the base rate on a mortgage loan, you need to provide a complete package of documents:
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Russian Federation passport;
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SNILS;
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Military ID (for men under 27 years old);
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Documents confirming employment and income.
The latter will vary depending on whether you are a business owner or an employee, and what field you work in (a separate set for notaries and lawyers).
When are the keys and property handed over when purchasing on the secondary market?
The law does not clearly indicate how long after the sale of an apartment it must be transferred to the new owner; usually the conditions for its transfer and the terms are specified in the contract. This period can range from several days to several weeks (this is discussed in advance among the interested parties). However, you need to remember that at the time of signing the deed and handing over the keys, the apartment must be free (of both tenants and furniture).
