How to register real estate as collateral for a loan from individuals

Rights and obligations of the parties

4.1. The mortgagor is obliged. 4.1.1. Use the Pledged Item in accordance with its intended purpose. 4.1.2. Not to take actions that entail a change, termination of the right of pledge or a decrease in the value of the Pledged Subject, with the exception of a decrease in value due to depreciation during normal operation of the Pledged Subject. 4.1.3. Do not dispose of or encumber the pledged item with any obligations (sell, assign rights, donate, lease, transfer as a deposit, etc.) without the written consent of the Pledgee. 4.1.4. Take all necessary measures appropriate to the circumstances to ensure the safety of the Pledged Subject, including its protection from attacks by third parties. Immediately notify the Pledgee of circumstances that may arise that may lead to seizure, encumbrance, reduction in value or deterioration of the Pledged Subject. 4.1.5. Provide the Pledgee with the opportunity to inspect the Pledged Subject during the period of validity of the pledge agreement. 4.1.6. Provide the Pledgee with the composition and grounds for residence of persons living in the Pledged Subject. 4.1.7. Provide the Pledgee with notarized obligations on his own behalf and from his family members living with him to release the Pledged Subject within 30 calendar days in the event of a legal claim against the Pledged Subject. 4.1.8. Insure the Pledged Item in favor of the Pledgee for an amount not less than its estimated value against the risks of loss or damage. Until the obligations under the Agreement are fully fulfilled, annually renew the insurance contract for the Pledged Subject on the same terms. Provide the Pledgee with copies of the insurance contract and rules certified by the insurance company. 4.1.9. Pay taxes, fees and other payments that are due from him as the owner of the Pledged Subject. 4.1.10. Carry out current and major repairs of the Pledged Subject. 4.2. The mortgagee is obliged. 4.2.1. Do not transfer your rights under the Agreement to another person by assigning the right of claim. 4.3. The pledgor has the right. 4.3.1. Use the Collateral in accordance with its intended purpose. 4.3.2. Alienate the Item to another person of the pledge (sell, donate, exchange, transfer as a deposit, etc.) only with the written consent of the Pledgee. 4.3.3. At any time, repay early the obligations under the main agreement secured by the collateral agreement. 4.3.4. At any time before the moment of its implementation, stop foreclosure on the Pledged Subject by fulfilling the obligation secured by the contract or its overdue part. 4.3.5. Bequeath the Pledged Subject. 4.4. The pledgee has the right. 4.4.1. Require the Pledgor to provide documents and information to verify the Pledged Subject according to the documents, the actual presence, condition and conditions of its use. 4.4.2. Require the Pledgor to take measures necessary to preserve the Pledged Subject. 4.4.3. Act as a third party in court when considering a claim regarding the Pledged Subject. 4.4.4. In case of alienation of the Pledged Subject in violation of clause 4.3.2. of this agreement, at its own discretion, demand: - recognition of the transaction for the alienation of the Pledged Subject as invalid with the application of the legal consequences provided for by the legislation of the Russian Federation; — early fulfillment of obligations secured by the contract with foreclosure of the Pledged Subject, regardless of who is its current owner, if it is proven that at the time of acquisition of the Pledged Subject, the acquirer knew or should have known about the violation of the conditions of clause 3.3.2. agreement upon alienation of the Pledged Subject. In this case, the acquirer of the Pledged Subject, jointly and severally with the Pledgor, is liable for the obligations secured by the agreement. 4.4.5. In the event of a gross violation by the Pledgor of the obligations of clause 3.1 of this agreement, demand early fulfillment of the obligations secured by the agreement. If the demand is not satisfied within 30 calendar days, foreclose on the Pledged Subject. 4.4.6. Receive compensation from the insurance compensation for loss or damage to the Pledged Item, unless the loss or damage to the Pledged Item occurred for reasons for which the Pledgee is responsible. 4.4.7. In the event of a real threat of loss, shortage or damage to the Pledged Subject through no fault of the Pledgee, demand replacement of the Pledged Subject, and if the Pledgor refuses to comply with this requirement, foreclose on the Pledged Subject before the deadline for fulfillment of the obligation secured by the Agreement. 4.4.8. Receive compensation at the expense of the Pledged Subject in cases where the Pledgee actually bears the costs of preserving and maintaining the Pledged Subject. 4.4.9. Transfer your rights under the Agreement to another person by assigning the right of claim. The assignment by the Pledgee of its rights under the Agreement to another person is valid if the rights of claim against the Pledgor under the main obligation secured by the Agreement are assigned to the same person. 4.4.10. To foreclose on the Subject of Pledge before the deadline for fulfilling the obligation secured by the pledge in accordance with Federal Law No. 102-FZ dated July 16, 1998 “On Mortgage (Pledge of Real Estate).”

How to draw up an apartment pledge agreement between individuals

When concluding an agreement, the parties have the right to indicate here any information they consider necessary.
But there are some information, in the absence of which the document may not be accepted for registration. For example, it is mandatory to describe in detail the apartment that serves as collateral. The terms of the loan are indicated. Often, the parties write a clause that provides for the possibility of selling the collateral if the need arises. ( Video : “Pledge of real estate. Pledge agreement. Legal advice”)

Such documents should be drawn up in triplicate. Each party must receive one copy. The third copy will be submitted to the state body upon registration of this transaction. Approximately the structure of the loan agreement is as follows:

Subject of the agreement

As stated above, detailed information about the apartment that is being pledged is provided. You need to write down the address where it is located and what floor it is located on. The total area and number of rooms are noted. It is imperative to indicate information about the documents on the basis of which the mortgagor is the owner of this property. Also here you need to specify the amount at which the parties to the transaction value the collateral.

Rights and obligations of the parties

Usually this item is written in as much detail as possible. Here the parties indicate what they consider necessary. For example, you can prescribe rules for the use of collateral. For example, the mortgagor will not be able to sell the apartment and perform actions that reduce its value. Also, it cannot be changed, rented, or given as a gift. You can indicate that the mortgagor has the right to live in this apartment, but at the same time he must allow the mortgagee to inspect it. In general, here you can describe in detail not only the responsibilities, but also the rights of each party.

Special conditions

If the mortgagor fails to fulfill his obligations, the terms of collection must be specified. It would also be useful to specify the conditions under which penalties are not allowed. For example, you can specify what late payments are allowed. It would be useful to consider the situation if the mortgaged apartment is eventually sold. If the amount of proceeds exceeds the amount of debt, the mortgagee who sold the property is obliged to return the difference to the mortgagor within ten days. Again, this should be discussed by all parties in advance to document the mutual decision.

Procedure for resolving disputes and claims

Usually, many people ignore this point because they are sure that the matter will not come to trial. But practice shows that disputes arise quite often. That is why lawyers recommend that this clause be included in the contract. For example, you can specify that claims and disputes must be sent to each other in writing. You can specify the period during which the party receiving the claim has the right to consider it. All this is done to ensure that the parties to the transaction have the opportunity to resolve disputes out of court. It is also necessary to indicate that if this was not possible, claims will be considered at the legislative level, i.e. through the court.

( Video : “081 Conditions of pledge agreements”)

Change, termination and termination of the contract

This point is also important. Here you need to indicate detailed circumstances under which you can terminate the contract early or make some changes to it. If we are talking about a mutual agreement between the parties, then everything is clear. More attention needs to be paid to the situation when termination occurs unilaterally. It is necessary to indicate whether such a possibility exists and in what situations.

Contract time

Like any document, this agreement must have a validity period. This period usually begins at the time of affixing the notarial signature. The parties can also specify a specific date, which will be the beginning of the validity period. Of course, the parties determine this period at their own discretion. But usually this agreement is valid until the parties terminate it early or completely fulfill their obligations.

( Video : “Loan and pledge of real estate. Registration procedure. Lawyer’s answer.”)

Legal addresses and details of the parties

Since an agreement can also be concluded between organizations, it is necessary to indicate their legal addresses. If we are talking about individuals, it is enough to write down their details at the bottom of the document.

Signatures of the parties

Each participant in the transaction must confirm all of the above. To do this, the parties sign an agreement. Naturally, without the autograph of one of the parties, the document cannot be considered valid.

It is worth noting that only an approximate structure of this document is presented here. If the need arises, the parties have the opportunity to introduce some additional clauses. For example, by mutual agreement, the responsibilities of the parties can be prescribed. This indicates what punishment is expected for failure to fulfill one's obligations. You can also specify force majeure situations. If such occurs, the parties may be released from liability.

Conditions for foreclosure on collateral

5.1. Foreclosure of the Pledged Subject occurs in accordance with the current legislation of the Russian Federation. 5.2. Foreclosure on the Subject of Pledge to satisfy the claims of the Pledgee may be applied in the event of failure to fulfill or improper performance by the Pledgor of the obligation secured by the contract under circumstances for which he is responsible. 5.3. Foreclosure is not allowed if: - the amount of the unfulfilled obligation is less than five percent of the valuation of the Pledged Subject under the agreement; — the period of delay in fulfilling the obligation secured by the contract is less than three months. 5.4. When foreclosure is made on the Subject of Pledge out of court, the Subject of Pledge is transferred into the ownership of the Pledgee or sold in the manner established by the current legislation of the Russian Federation. 5.5. If the amount received from the sale of the Pledged Subject exceeds the amount of the Pledgee's claim secured by the contract, the difference is returned to the Pledgor no later than ten calendar days from the date of sale.

Requirements for collateral real estate

The property provided as collateral must serve as a guarantee that in the event of the sale of this item, the proceeds will cover the loan provided with interest, as well as fines, penalties and legal costs.

An apartment for collateral must meet certain requirements, otherwise the offer may be rejected

The risk of covering additional costs must be included in the agreement. Therefore, the following requirements apply to real estate offered as collateral:

1. Liquidity of the object. Territorial affiliation may play a role, because a house located far from infrastructure is less attractive, but this feature is considered by the lender at its own discretion.
2. Individual requirements regarding technical characteristics. As a rule, apartments that citizens want to buy quickly and at a price favorable to the seller are of interest.
3. When participating in a contract, there are special features in the form of obtaining permission from other persons, it is drawn up simultaneously with the conclusion of a security obligation. The procedure is necessary to prevent disputes later.
4. Housing must comply with the BTI technical plan. If redevelopments are carried out, they must be registered accordingly.
5. The apartment does not have previous restrictions and encumbrances and is not the subject of litigation.
6. Among those registered in the living space there should not be citizens deregistered due to service in the RF Armed Forces or in prison.
7. If there are registered minor children, the consent of the guardianship authorities to pledge this living space is attached to the papers.

The listed requirements are not exhaustive, and additional criteria can be set by a citizen who is inclined to purchase a mortgage at his own discretion.

Force Majeure

9.1. The Parties are released from liability for complete or partial failure to fulfill obligations under the contract if the failure to fulfill obligations was the result of force majeure, namely: fire, flood, earthquake, strike, war, actions of government authorities or other circumstances beyond the control of the Parties. 9.2. The Party for which it has become impossible to fulfill its obligations shall immediately notify the other Party of the occurrence of force majeure circumstances and provide supporting documents. 9.3. The Parties acknowledge that the insolvency of the Parties is not a force majeure circumstance.

The Agreement is drawn up in 3 (three) original copies in Russian.

Appendices 1. Agreement …………………………… from “…..” …………………. 20….. g.

Contents of the loan agreement

The ability of the lender to get back the issued funds and avoid unclear issues depends on the completeness of filling out the document with fundamental points. Lawyers have recommended some points that must be contained in the document:

• Detailed, without abbreviations, data of the parties. Establish the obligation to inform the opposite party of information that changes after signing the papers.
• The cost of the agreement is stated in digital and written form.
• The date the transaction was concluded and the period after which the agreement will be repaid. An option is possible when the countdown for payment of the obligation is set within 30 days after the lender announces an official demand for repayment.
• If the parties have discussed the option of partial settlement, this algorithm should be described in the document.
• Method of payment (pay the debt by bank transfer or in cash).
• Tariffing is indicated in specific numbers and the moment from which its calculation begins is fixed.
• The lender's attitude towards early repayment of debt.
• Possibility of applying a penalty in case of non-compliance with the terms of the transaction.
• Force Majeure.
• Possibility of a peaceful settlement.
• Algorithm for the action of the party against whom violations are committed to restore their rights.

The parties sign each page of the document as agreement with the written points.

Making mistakes, blots or corrections is unacceptable

Agreement on pledge of real estate between legal entities

The object of such an agreement cannot be residential property. Therefore, an apartment or any other housing cannot be the subject of a transaction between legal entities.

Interest-free loans are also prohibited if at least one party is a legal entity. The contract itself and the package of documentation for the property are sent to the registration authorities.

For such actions you will have to pay a fixed 5,000 rubles. and 2% of the cost of the objects included in the transaction. The registration period is up to 30 days. Documents are signed by the general director or an authorized person who has the appropriate power of attorney (similar to delivery). Such a transaction is not subject to mandatory notarization.

To view a sample agreement for apartment renovation between individuals, go to

Real estate pledge agreement

The condition that the loan agreement provides is an agreement stipulated by both parties to pledge property or on the terms of a guarantee between the lender and the borrower. The content of the article

• 1 Functions of the contract
• 2 Subject of the agreement
• 3 Storage of collateral
• 4 Certification of the contract

Functions of the agreement The agreement performs the following two main functions:

1. Ensures timely payment by the debtor of the entire debt, which is provided as a result of signing an agreement-obligation between the lender and the borrower.
2. For the lender, it serves as an additional guarantee in case of non-compliance with the borrower’s fulfillment of the agreement on timely payment of the debt.

Agreement conditions

The text of the agreement must include a reference to the main obligation, that is, directly to the loan (credit) agreement to ensure the return of which a mortgage on the apartment is issued.

The borrower receives the right to sell the pledged apartment under the terms of the pledge agreement from the moment the payment becomes overdue. Therefore, a copy of the main agreement (loan agreement) with a schedule for the return of funds received must be attached to the collateral agreement.

Information about the cost of the pledged apartment is included in the pledge agreement as a separate paragraph. As a rule, the assessment of an apartment differs significantly from its cadastral value. The fact is that to evaluate collateral, special expert techniques are used to determine the cost of an apartment not only according to cadastral conditions, but also based on the condition of the apartment, the degree of its amenities, etc.

Contract form

An apartment pledge agreement can be drawn up in either simple written or complex written form. The concepts “complex” and “simple” have nothing to do with the ease or complexity of drawing up an agreement, but imply the conclusion of an agreement with or without the participation of a notary. That is, both options will be legal, and contacting a notary is solely the desire of the parties.

Contacting a notary will be mandatory if the mortgage is not the entire apartment, but its share. This rule is recent, and therefore many people do not know about it. The rule was introduced due to amendments made to the Law “Fundamentals of Notaries” dated August 3, 2018.