How to buy an apartment with a mortgage in another city?

The scheme, in which you can take out a mortgage in one city and buy an apartment in another, is legal, but not practiced by many banks, mainly those with a developed branch network. Among them are Sberbank, Rosselkhozbank, VTB, Alfa-Bank and others.

Situations in which there is a need to obtain a mortgage in one city and purchase a home in another are associated with relocation, the desire to be closer to work, place of study, or receive rental income.

How to get a mortgage in another city, what conditions can you count on, what requirements must housing meet, under what circumstances will the bank definitely refuse, what additional documents will be needed and are there any pitfalls in this type of lending - you will get answers to these questions by reading article to the end.

Is it possible to get a mortgage in another city?

It is certainly possible to purchase an apartment in another city using borrowed funds. However, for credit institutions, such a decision carries additional risks (borrower’s solvency, control over payments), so not every bank will approve a mortgage for purchasing an apartment in another region.

Main problems

When deciding to purchase housing with a mortgage in another city, you need to study all the possible difficulties that you may have to face:

longer term for completing a transaction;
additional expenses for trips to another city to inspect the apartment, conclude an agreement, register a transaction;
expenses for intermediary services;
limited choice of credit institutions willing to provide loans;
More stringent conditions for the borrower are possible (increased interest rate, shortened loan term, life and health insurance).

For the bank, such a transaction also brings additional difficulties, because in addition to checking the legal cleanliness of the apartment and the solvency of the borrower, it needs to coordinate the work of branches in different cities.

Many of the listed problems can be avoided if you contact a bank that has a large network of branches and sufficient experience in conducting this type of transaction.

Terms of purchase

Some credit organizations consider the borrower's lack of registration in the city where he plans to apply for a loan as grounds for refusing to issue a loan. Therefore, you will have to spend some time searching for a bank that can issue a loan based on your current conditions.

The options may be the following:

If the property is located in a city where the borrower is not registered, is not employed and does not actually live, then it is more advisable to contact the bank at his place of residence.
If you have a permanent job and a high income in the city where you plan to purchase housing, but are not registered, your chances of getting a loan are quite high.
If the borrower wants to purchase real estate in a city where he only has registration, but does not actually live or work there, then such an application can be approved by a credit institution;
If it is impossible to travel to another city to conclude a transaction and register it, it is possible to issue a power of attorney for a representative.

In any of these cases, we recommend that you first contact the banks to find out the possibility of loan approval, and only then start searching for suitable real estate.

Conditions for obtaining a mortgage

A mortgage loan is issued against purchased or owned real estate. The collateral must be insured against the risks of loss or damage. Life insurance, as well as the risk of loss of property rights, is taken out voluntarily.

The remaining conditions of a mortgage in another city also do not differ from the standard ones:

The minimum rate in VTB and UBRD will be 8.9%, in Alfa-Bank - from 8.99%, in Promsvyazbank - from 9.05%, in Sberbank - from 9.5% (for apartments from partner developers - from 7 .5%), in Rosselkhozbank - from 9.3%, and in Raiffeisenbank - from 10.25%. If you cancel life insurance, the rate will increase by 1%.
The down payment on a mortgage at VTB must be at least 10%, at Sberbank, Alfa-Bank, Rosselkhozbank and Raiffeisenbank - from 15%, at UBRD - from 20%, and at Promsvyazbank it is possible to obtain a mortgage loan without a down payment.
The maximum loan amount in Raiffeisenbank is 26 million rubles, in UBRD and Promsvyazbank - 30 million rubles, in Alfa-Bank - 50 million rubles, in Rosselkhozbank and VTB - 60 million rubles, and in Sberbank it is limited only by your solvency and the cost of the purchased property. To increase the approved loan amount, you can attract co-borrowers. The spouse, in the absence of a marriage contract, is required to act as a co-borrower.

Which credit institutions can I get a mortgage from?

To decide on the choice of a credit institution, first of all you need to find out the availability of its branches in your city and where the purchase will be made. As a rule, large banks have branches in many cities. The leader among mortgage lending is Sberbank, as it has branches in every city.

You can also apply for a mortgage loan to purchase real estate in another region by contacting the following credit organizations:

Sberbank;
Gazprombank;
Alfa Bank;
VTB;
Raiffeisenbank.

Before completing the documents, please check:

how well is the interaction between bank branches established;
what stages of the transaction can be carried out remotely;
In what cases will you have to come to another city in person?

This will help you accurately calculate all possible costs of completing a transaction.

Is it possible and how to check out of an apartment while in another city?

Is it possible and how to buy an apartment with a mortgage from a relative?

Requirements for the borrower

A mortgage can be issued by citizens of Russia, but citizens of any other countries living and working in the Russian Federation can receive it from VTB, Raiffeisenbank, Alfa-Bank. To receive a positive decision on your application, you must meet the following minimum bank requirements:

age at the time of application - from 21 years (in UBRD - from 23 years), and on the date of planned full repayment of the debt - no more than 65 years (in UBRD - up to 70 years, and in Sberbank - up to 75 years);
having an official place of work and income that allows you to fulfill your mortgage loan obligations;
work experience at the current place - from six months (at UBRD - from 3 months);
total experience – from one year.

Applying for a mortgage in another city

When applying for a mortgage to buy a home in another city, you need to be prepared for the fact that you will need to take more steps and it will take a longer time. However, it is possible to obtain such a loan; you just need to get the bank’s approval and go through all the stages of registration.

Requirements for the borrower

To obtain a mortgage loan, a potential borrower must meet some standard requirements:

age must be at least 21 years and not more than 75 years at the time of full repayment of the loan;
mandatory presence of Russian citizenship;
total work experience of 1 year and at least 6 months at the last place of work;
proven solvency.

A positive credit history, a permanent job with a high salary, and a significant down payment will help increase the chances of your application being approved.

List of documents

To apply for a mortgage loan to purchase a home in another city, a standard list of documents is required:

passport of the borrower (co-borrowers), guarantors (if any);
second document (for example, SNILS, military ID);
marriage certificate and notarized consent of the spouse (if the borrower is married);
documents for the purchased apartment;
a copy of the work record book certified by the employer;
income certificate in form 2-NDFL or in the form of the creditor bank.

Depending on the bank's conditions, additional documents may be required.

Registration procedure

If the borrower is located in one city, and the purchased property is in another, then the application and assessment of solvency is carried out by the bank branch at the place of his residence, and the transaction is documented by the branch at the location of the housing.

The main stages of the procedure for obtaining a mortgage are similar for different credit institutions.

To do this, the borrower must:

send applications to banks that provide loans for the purchase of real estate in other regions (through websites or by visiting offices in person), and obtain approval of the application;
find an apartment option that meets the wishes of the borrower and the requirements of the lending bank;
independently or through a representative, prepare documents in relation to the acquired property for the bank to assess the legal cleanliness of the apartment and its condition (submitted to the branch at the location of the property);
insure the purchased housing;
conclude a mortgage agreement (at the borrower’s place of residence or at the location of the property);
carry out state registration of the transfer of rights.

In essence, the registration procedure is no different from a regular mortgage, the only difference is that two bank branches are involved in this process.

Terms and procedure of payments

Final payments for a mortgage are made cashless, so a few days after registering ownership, the bank transfers funds to the seller’s account. Maternity capital funds or other government programs used during the purchase will be received by the seller later (in accordance with the terms of transfer under these programs).

Note! Some banks may charge a commission for transferring funds between regional branches. Inquire about the availability of this condition in advance to avoid getting into an unpleasant situation.

Choosing a bank and lending program

To get a mortgage loan on favorable terms, you need to decide on a banking program that suits your needs. Registration conditions depend on what kind of property is being purchased.

Separate mortgage programs with special lending conditions are provided for military personnel (military mortgage). Also, many banks offer a simplified loan option - a mortgage under two or even one document. To apply for it, you do not need to confirm your income and employment, but the down payment amount must be at least 50%.

When choosing a banking institution, pay attention to the following recommendations:

Study the conditions of the bank that issued your salary card. As a rule, cardholders are provided with certain privileges in obtaining a mortgage.
If you are purchasing housing from a developer, check with him which banks he cooperates with. Construction companies and lenders often launch joint promotions, thanks to which you can purchase an apartment with a mortgage on preferential terms.
Evaluate the bank in terms of the convenience of loan repayment (including early repayment) and the availability of remote services (Internet banking, mobile application).

Registration of property rights in Rosreestr

Purchasing a home in another city is not uncommon these days.
At the same time, the buyer is often forced to travel to another city several times, including to complete registration actions with Rosreestr. In order to save time, Rosreestr has introduced a new service - electronic registration of a transaction. This service involves the transfer of documents for registration electronically through credit organizations. The period for reviewing documents and registering them is 1-5 days.

The main problems of intercity mortgages

One of the mandatory requirements for a client when submitting a mortgage application is permanent or temporary registration in the city/region where the bank operates. Such restrictions are imposed by most Russian banks. Indeed, residence and registration are a kind of guaranteeing factors in reducing the risk associated with the borrower’s flight in case of refusal to pay under the contract.

The key issues associated with intercity mortgages are:

extending the deadlines for consideration of the application and execution of the transaction itself;
interaction between branches of one bank in the process of decision-making and signing of papers;
the occurrence of additional financial costs for the services of a notary, realtor, etc.

All these problems arise from the territorial remoteness of the acquired property and the borrower. The bank needs much more time to check the borrower’s data, visit the residential property and carry out its legal verification, and conclude a purchase and sale agreement. Also, many certificates and extracts have a limited statute of limitations, which should be taken into account when collecting a package of papers.

NOTE! If the bank has a wide branch network and an established process of work within its structure, then the identified disadvantages of the problem can be minimized.

Many credit institutions refuse to issue long-term loans for the purchase of real estate in other cities and immediately voice their refusal. Others may deliberately increase the interest rate, require full insurance of property and life/health of the borrower, or shorten the loan term.

Lawyer's answers to frequently asked questions

My husband and I are planning to buy an apartment in another city in our own name, but our children will live in it. Traveling alone with your spouse is very costly financially. Can one of us go there to complete the transaction or do we both have to be present?

It is not necessary to travel together. One of the spouses can go to complete the transaction, but it will be necessary to obtain a notarized consent of the second spouse to purchase the apartment.

Hello! My husband and I own a 3-room apartment; our children only have registration in it. Can we buy another apartment in another city with a mortgage and invest maternal capital in it? Or will the pension fund refuse us? The second child is now 1.2 years old.

The purchase of an apartment using maternity capital funds is not limited to the city in which the certificate was issued. The only restriction is that the apartment must be purchased on the territory of the Russian Federation. If you buy an apartment with a mortgage, then the age of the child does not matter.

I want to buy an apartment with a mortgage in another city, but due to work I don’t have the opportunity to travel often, at most I can go once. Is it possible to give such powers to a relative who lives there and will he be able to not only choose an apartment, but also sign a purchase and sale agreement on my behalf?

Yes, you can issue a notarized power of attorney for your relative. He will be able to perform all actions that will be specified in the power of attorney. Be careful when compiling it. You will have to perform actions not specified in the power of attorney personally.

Please tell me, if I buy an apartment in another city with a mortgage, then which city should I apply to the Registry of which city to register ownership, at the place where I bought the apartment or at my place of residence?

The transaction is registered in the Rosreestr of the city where you will purchase the apartment. To do this, you will need to be there in person or issue a power of attorney for your representative. You can also check with your creditor bank about the possibility of using the electronic transaction registration service. This will give you the opportunity not to waste time traveling to another city and send documents for registration through the bank electronically.

I am planning to buy an apartment for my daughter in the city where she is studying. But there are not enough own funds and therefore you will have to use a mortgage. I have an unpaid consumer loan. I pay regularly and without delays. Can the bank refuse me a mortgage given that I have an outstanding loan?

When considering your application, the bank will definitely check your credit history. If your credit discipline and income allow you to make mortgage payments and pay off an existing loan, then the likelihood of getting a mortgage approval is high.

Real estate requirements

You can purchase an apartment in a finished or under construction building, a townhouse, apartments, or an individual house with a mortgage. At Sberbank it is possible to use mortgage funds to purchase a garage, parking space, and land.

The purchased property should not be pledged to third parties or have restrictions imposed by judicial authorities. The purchased housing must be suitable for year-round use. It is not allowed for a house to be recognized as unsafe or included in the lists for demolition, reconstruction, or major repairs.

It is necessary that the kitchen and bathroom be separate. The apartment or house must have a connection to communications (water, sewerage, electricity, etc.). Plumbing equipment, windows, doors, etc. must be in good technical condition. And any redevelopment can only be done legally.

Also read: Which apartment is suitable for a mortgage and how to find out why the bank did not approve the housing

What risks may the borrower face?

Mortgage transactions with a contribution of 20% carry minimal risks for the bank. The lender will always be able to sell the property slightly below the market price if the client refuses to pay. The risks when applying remotely are the same as when approving a regular mortgage loan. However, loan recipients may face some inconveniences:

Sometimes there are delays in approving an application due to lengthy document verification;
There are often no effective communication and document flow systems within institutions;
you will have to spend a little money on paying for the courier service that delivers the papers.

Inconsistency in the actions of managers, lengthy checks of documents, the need to involve a third party to send papers - all this can cause a delay in completing a transaction. As a result, the recipient will experience inconvenience as he will have to update his employment certificates or re-apply for bank approval.