Buying an apartment under DDU in 2021: What's new?

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2020 made its own adjustments, rules and benefits. And some of them remained in 2021, so before we talk about the innovations of 2021, let's look at what remains relevant from last year, and since I already mentioned benefits earlier, let's start with them.

In 2021, one of the government support instruments was a preferential mortgage rate of 6.5% per annum for buyers of apartments in new buildings, and this program was extended until July 1, 2021. It is not yet known whether it will be extended again, but let’s remember the main conditions for obtaining a preferential mortgage:

Have Russian citizenship
The mortgage agreement must be concluded before July 1, 2021.
Only apartments in new buildings are suitable
The house can be either at the “pit” stage or already for rent
The maximum amount varies from 6 million to 12 million rubles depending on the region.
The rate is 6.5% per annum for the entire loan term.
The down payment is at least 15% of the cost of housing.
It is possible to use maternity capital or other types of government support.

It is important that the mortgage agreement must be concluded before July 1, 2021; this program applies to both ready-made apartments and apartments in the “pit” stage.

What innovations have appeared in 2021?

The abolition of shared construction has been discussed for a long time, but this would be too risky a step. Therefore, in 2021, a decision was announced to make a smooth transition to a new model of participation in construction - project financing. That is, now the bank will act as a guarantor of the success of construction. Is it good or bad?

It is difficult to answer this question unambiguously; of course, this scheme looks the most transparent, if only because the money invested by investors “will not go anywhere”, but will be transferred to escrow accounts in banks; we will tell you what these accounts are a little later. Among other things, in the event of the developer’s bankruptcy, investors will have their deposits returned, because now the developer is obliged to build with finances “out of his own pocket,” which will certainly lead to a “cleansing” of the development market.

But now let’s look at the same scheme through the eyes of a shareholder, let’s say you purchased an apartment at the “pit” stage, investors invest money in the developer, but in the middle of construction he closes the construction site and declares himself bankrupt. The bank reimburses all the money to investors, but what about shareholders? No, shareholders, unfortunately, cannot withdraw their money ahead of schedule; they will have the right to do so only when the company violates the terms of the project financing agreement.

But let’s not panic ahead of time, according to the adopted amendments to the law on shared participation in construction, in 2021 a company will be able to complete a project according to the old rules if:

Buyers have made at least 10% of the investment, and the facility is at least 30% ready;
The facility is 15% ready, but within the framework of the project, comprehensive infrastructure development is planned (for example, opening a kindergarten and school, opening a store or cafe)
Readiness is from 6%, but the work is carried out by a large, reputable company.

Now we'll tell you everything!

Let's start with a simple one, an escrow account is a bank account in which certain amounts are stored until certain circumstances are met, in this case, construction and the start of renting out apartments to equity holders. The legal side of escrow accounts and escrow accounts in shared construction can be found in Article 860.7-860.10 of the Civil Code of the Russian Federation and Article 15.4 of Federal Law-214.

Since 2014, it became possible to conclude an escrow account agreement, but at that time it was only one of the types of bank accounts, but was used, for the most part, only in the public sector. corporations.

Then in 2021, they began to think about using escrow accounts as a guarantee of work completion. However, then this idea did not receive any large-scale response and was shelved for another couple of years.

And in 2021, the government finally announced the use of such accounts.

Earlier I mentioned that escrow accounts are not ideal for investors, but let’s figure it out anyway. The payment mechanism through escrow accounts ensures that you either have money left over or you get the apartment. Money for construction is blocked or, in banking parlance, deposited in accounts until the ownership of the first rented area/apartment is registered. Also, if any problems arise with the developer, the buyer will be able to return the amount he paid.

Developers are financed for the most part by banks, and escrow accounts are also opened in the same banks lending to the project. Therefore, the builder or developer can benefit from a good sale of apartments during the construction phase and reduce the interest on the loan.

Registration of a share participation agreement

Another advantage of DDU is that it protects against double sales. Since the house is still under construction, a person cannot immediately move into the purchased apartment. In the meantime, it exists only on paper; theoretically, it can be sold a second or third time.

DDU protects against this. The agreement must be registered with Rosreestr. And if the developer brings another document for the same apartment, the contract will not be registered, that is, it will not be possible to complete a dubious, to put it mildly, deal.

Below we will tell you how the registration process itself goes.

Preparation of documents

According to the head of the legal department of the Construction Holding Company, Olga Tataurova, the package of documents for the DDU depends on the specific situation. In any case, you will need a passport, but here are the following options:

if the shareholder is married and enters into an agreement for himself, then the consent of the spouse;
if two spouses enter into a marriage certificate or marriage contract;
if children are involved in the purchase, then the children’s birth certificates (passports);
if maternity capital is used, then a certificate for inclusion in the DDU, the conclusion of the guardianship authority;
if social benefits, then certificates or other documents depending on the program.

Signing an agreement with the developer

First of all, ask the developer for a project of a preschool building. This is a document that the company itself offers its customers to sign. Already from this preliminary version, the article can make a lot clear. The DDU, even its draft, must include the following points:

building address of the house;
cadastral number of the site on which construction is taking place;
floor and number of the apartment you are buying;
total housing area, layout, ceiling height;
date of completion of the house.

If they are not there, or they raise questions and misunderstandings in you, this is a reason to be wary. If everything is in order and you are ready to buy an apartment in this building, draw up this agreement with the developer’s manager. It is not necessary to sign it immediately. In general, you don’t need to sign anything without reading it. Moreover, a document about probably the main purchase in your life. You can take a couple of days to thoroughly explore everything. Compare the final document with the draft. It would be a good idea to show it to a third-party lawyer. And most importantly, remember that the contract that the manager of the development company puts before you is not some kind of indisputable axiom. If you don't like something, tell the manager about it. You are not required to agree to the seller's terms.

Suggest your own wording if you are not satisfied with the ready-made ones. It is better to work them out with a lawyer.

Often the stumbling block here is the issue of compensation. It is not always possible to build exactly what was sold at the boiler stage. This does not mean that the house is of poor quality, it’s just that the wall was placed almost there, and now you have one apartment larger and another smaller. If you accidentally find yourself in possession of a couple of extra squares, the developer will certainly want to get money from you for them - and will include a corresponding clause in the contract. But if your apartment turns out to be slightly smaller than planned, the builders must pay - return the money for the lost space. Developer managers sometimes “forget” about this when drawing up an agreement.

— As a rule, the signing of the DDU takes place at the developer’s office, and immediately after that the company’s employees submit it for registration with Rosreestr. To do this, the future shareholder will be asked to issue a power of attorney to submit documents. It is important here that the power of attorney does not include the right to alienate real estate,” warns director Svetlana Pankova.

Registration of the agreement in Rosreestr

Large developers often take on this stage themselves. The shareholder will be asked for a power of attorney to register the DDU (it must be issued in advance by a notary). After 5 days, the developer’s representative will receive the finished DDU, and the shareholder will be given a copy of it.

But again, it is your right whether to agree to this option or not. If you have time and don’t want unnecessary worries, you can do everything yourself. To do this, the shareholder, together with the developer’s representative, goes to the MFC or Rosreestr branch.

There they will check to see if this apartment already has an owner, and if everything is in order, the contract will be registered. After this, you are officially the owner of the property, even if it is still at the excavation stage.

You need to pay a fee to register a DDU. For individuals it is 500 rubles.

What are the pros and cons of escrow accounts?

The buyer retains his funds in the event of bankruptcy or other problems of the developer, if all obligations under the contract are fulfilled.
The parties entering into an escrow account agreement can choose the documents themselves that will serve as a guarantor of the transaction.
Investments up to 10 million rubles are insured by the Deposit Insurance Agency.
Escrow accounts are not subject to seizure (clause 4 of Article 860.8 of the Civil Code of the Russian Federation. Restrictions on the disposal of funds and the use of an escrow account).
The shareholder opens an escrow account for free.
The scheme for purchasing real estate through escrow accounts makes it possible to get rid of the asymmetry of the transaction, where on one side is the shareholder (or his authorized representative), and on the other is the developer. An individual does not have such competence to check the developer, but the bank can already examine his reliability.

Content

Why is it a DDU when buying an apartment in a new building?
Compilation of the text of the DDU
State registration stage
Payment for DDU

Federal Law No. 214 thoroughly prescribed the requirements, compliance with which during the process of its registration must be strict. Otherwise, the agreement will simply be declared invalid. Therefore, such an important issue as registration of preschool education in a new building must be approached with the utmost seriousness. Indeed, in this case, the shareholder pays for real estate that does not yet exist in nature. It only exists on paper for now. Therefore, the risks are very high.

How to get a mortgage from a bank based on the assignment of rights?

To purchase an apartment in a building under construction, you can take out a mortgage loan from a bank. To do this, it is necessary to draw up an agreement on the assignment of rights under the DDU, and then a loan agreement.

The bank will check the developer, make sure that it is possible to deal with him and issue a loan. To do this, of course, the borrower must fully meet the bank's requirements and be ready to pay monthly payments.

To obtain a mortgage you will need:

present a certificate of employment indicating your salary;
conclude an agreement for the assignment of rights under the DDU;
show a copy of the main DDU;
make a down payment (from 15-30% of the cost of housing);
draw up a loan agreement.

An assignment under an agreement is allowed only after settlement under the agreement or simultaneously with the transfer of the debt to a new person. Another requirement: the DDU agreement must already be registered in order for it to be possible to assign claims.

Average mortgage loan rates in Russia at the beginning of 2021 were at the level of 10-11% per annum in rubles. If the income is not enough, the bank may ask you to provide property as collateral : another apartment, a car or a dacha.

How to purchase an apartment by transfer of rights is described in a separate article.

Assignment of DDU. What is an assignment agreement? RISKS / ERRORS / INNOVATIONS 2021

You might be interested in: Escrow account – what is it? In simple words about buying a new apartment

Risks and pitfalls

When buying an apartment on the primary market, there are usually more risks than in the case of a secondary market. The main ones:

the risk of construction being frozen for an indefinite period;
disappearance of the developer with investors' money.

To prevent this from happening, you need to carefully check the developer:

study the construction experience of previous projects;
constituent documents;
reputation of the company's owners.

Risks when buying an apartment:

poor quality construction;
bankruptcy of the developer;
double sale (the same apartment is sold to two or more buyers);
changing the project declaration (for example, increasing the footage with a requirement to pay extra);
increase in cost per square meter.

Nuances:

In order to avoid the risk of double sales, it is necessary to register the agreement with Rosreestr, because:
the presence of an electronic entry in the register blocks the possibility of selling the same apartment to others.
It is more difficult to insure against poor quality construction. But there are certain quality requirements that are specified in the contract and project declaration. The developer has no right to violate them. If this happens, then make a list of non-compliance with what was promised under the contract and insist on eliminating all the shortcomings as soon as possible.
It happens that the developer changes the project declaration without permission, presenting the shareholder with a fait accompli. This is usually due to an increase in the area of the apartment or, conversely, a decrease. If you are forced to pay for additional square meters, although this was not agreed upon, then you have the right to appeal this in court. According to the law, changing the area of an apartment by more than 5% is prohibited, and shareholders have the right to demand termination of the contract in court and the return of invested funds.
An increase in the cost per square meter may also be disputed due to the situation on the real estate market, the depreciation of the exchange rate and other factors. Try to provide for this possibility during the discussion of the text of the agreement (before signing) and minimize your risks. For example, you can clearly state in the agreement that the increase in value cannot be carried out unilaterally without the consent of the shareholder.

How to reduce risks when buying an apartment under DDU?

Features of payment for DDU

The price of the contract is an essential condition of the agreement. In addition to the amount, the text must clearly state the procedure for paying for the DDU.

What options are possible?

Payment in a one-time payment of the entire amount;
Payment of the amount in installments. In this case, it is better to draw up a payment schedule, indicating the payment period and the amount of payments.

If the participant uses a mortgage program, then in this case the entire amount is usually deposited into the escrow account of the construction company.

It is important to carefully study the terms of the contract before signing it, because the participant may be subject to a fine in the form of a penalty for late payment under the DDU.

Latest changes in legislation regarding shared construction

Last year, Federal Law No. 218-FZ “On a public law company to protect the rights of citizens participating in shared construction in the event of the insolvency (bankruptcy) of developers and on introducing amendments to certain legislative acts of the Russian Federation” was adopted.

This law has tightened the conditions for shared construction. The developer company undergoes a thorough check to ensure compliance with the stated requirements. In particular, she must have experience in the construction of apartment buildings, a certain authorized capital, a complete list of necessary documents, etc.

The changes took effect in July 2021. The updated requirements have made life much more difficult for developers. It is possible that many will not be able to fulfill all the conditions and will be forced to cease their activities. It is now difficult to predict whether the changes will benefit shareholders by protecting them, or, on the contrary, will only worsen the economic situation by increasing the cost of apartments.

Essential conditions

The contract must contain essential terms:

subject (description of the apartment);
real estate price;
timing of the agreement (transfer of housing ownership);
warranty periods for fulfillment of obligations and instructions;
how their implementation is ensured.

The contract must also include:

details of the parties;
legal grounds for construction;
housing price per square meter of total area;
price revision procedure;
rights and obligations of the parties;
liability for violation of the terms of the contract.

If the agreement does not contain essential terms, then state registration of such a document in Rosreestr will be impossible. The terms of the contract must fully comply with the project declaration.

Registration of the DDU allows you to avoid double sales and officially secures the rights of the shareholder to the property.