Mortgage, general idea
Mortgage lending is the longest among existing loans. This scheme has its advantages:
- you don’t need to borrow money from anyone;
- the apartment is immediately registered as ownership;
- The loan can be calculated according to your needs;
- the legal reliability of the agreement leaves no doubt.
Getting a regular loan is impossible without a guarantor. This is not required when applying for a mortgage.
The apartment purchased by the bank client will serve as collateral. In other words, an encumbrance is placed on the apartment (without the bank’s permission, transactions such as sale, donation, or re-registration of square meters are impossible).
But you can live in it, do repairs, etc. the encumbrance is removed as soon as the mortgage is paid off.
Among the negative aspects of a mortgage, we can only highlight high interest rates, which in some cases can reach the cost of the purchased property. Also, the borrower is not the full owner of the apartment until he repays the mortgage loan.
Typically, an individual does not have the required amount of money; therefore, mortgage loans have a long term and an impressive loan amount. The mortgage can be approved for a period of up to 30 years.
When applying for a mortgage, you can choose the method in which the loan will be repaid. There are two of them - annuity and differentiated. The first assumes the same payment amount for the entire loan period. The interest in this case is distributed evenly. Differentiated payments differ in that the amounts are decreasing. At first, contributions will be maximum, gradually their amount will decrease.
A mortgage allows you to acquire your own treasured meters of living space
Checking your credit history
For everyone who has at least once filled out an application for a loan, a personal file or credit history is maintained.
Note! The CI contains information not only about received and repaid loans and overdue loans. Starting from 2021, you can find out about rent and telephone debts in the BKI. Don’t forget that the credit history cover page is available to almost everyone, including employers.
Formally, the borrower can refuse to check the CI. But in this case, refusal to issue a mortgage or consumer loan is inevitable. If your plans are to receive a significant amount of money to buy an apartment, it is better to first make a request to the BKI yourself and check your history. We must not forget about technical errors (for example, attributing data to a namesake or namesake), untimely transfer of information by the bank, etc.
First steps when applying for a mortgage, where to start
The stages of obtaining a mortgage are in most cases standard and differ little from each other. Minor differences depend only on the lending programs that banks offer to their clients.
Important! Each bank has its own methodology for calculating the maximum amount. So, for example, in one branch they may offer only 1 million, in another the same person is approved for a larger amount, for example, 2 or 3 million.
When you decide to take out a loan to buy a home, you first need to decide on a suitable mortgage program. Different banks offer their own conditions regarding the down payment. You need to weigh the amount and the possibility of payment.
It is necessary to clarify whether this bank operates with maternity capital or government support. Under the program for young families, you can expect a lower down payment.
The estimated loan amount is calculated so that the monthly payment is no more than 60% of the borrower's total family income. After reviewing all the offers of available banks, you can choose the most optimal option.
Applying for a mortgage
After selecting the appropriate program, you can begin collecting the documents required to submit your application.
Important! The quality of the documents provided determines whether the bank will approve the mortgage or not.
The standard package of documents includes:
- original client's passport and photocopy of all its pages;
- a certificate of income for the last six months according to the established format;
- document confirming employment (copy of work record book or employment contract);
- confirmation of the availability of funds required to pay the down payment;
- mortgage application completed by the borrower.
In addition, you can submit documents confirming additional income, if any. An application can be submitted to several banks at once, as copies of documents are considered.
It is difficult to answer unequivocally about how long it takes to obtain a mortgage from Sberbank. It will take 3-15 days to review the documents. After this, the credit commission issues approval or refusal for mortgage lending. A positive decision is valid for 2-4 months. During this time, you need to choose an apartment and collect all the required documents.
The size and term of mortgage lending is calculated individually based on the borrower’s income
How does the mortgage transaction work for the buyer?
Now, secondly, from the perspective of the borrower, the process of buying a home with a mortgage will look like this:
Getting approval.
To begin with, it is worth assessing your strengths and capabilities. Understand how much and how to save for a down payment. Decide on the loan term and calculate the monthly mortgage payment. Next, you need to submit an application to one or more banks and wait for a decision on it. If a positive answer is received, then you can proceed to the next stage.
Read: Why did banks refuse a loan?
Selecting an object.
Understanding that the bank is ready to lend the required amount of money, you can begin to select an object taking into account this criterion. That is, you can do this on your own by scrolling through thematic sites. Or use the services of a mortgage broker. Of course, not for free. Before you start collecting documents for a mortgage, it is worth checking with the seller whether a mortgage transaction with his property is possible. Often, apartments are subject to encumbrances and other limiting factors that prevent purchase and sale with the participation of a financial institution.
Object assessment.
As with the seller, the appraiser's decision is important to the buyer. As a rule, this is a representative of the creditor. This is the simplest option. However, a third-party expert may also be involved, and the borrower is tasked with finding one if necessary. The official takes a series of photographs of the building, the entrance, the staircases, as well as the apartment itself and the views from the windows. And then prepares a conclusion indicating the market value.
Collection and submission of documents to the bank.
This step can be done in parallel with the second side. Everyone prepares their own documentation in accordance with the bank's requirements. For the buyer, this list largely repeats the one for which the documents are needed to apply for a loan. The main ones are:
Passports of all borrowers and co-borrowers;
- Application form for a mortgage;
- Marriage agreement, if any;
- Marriage certificate;
- Income confirmation;
- SNILS.
It is worth noting that you can indicate your income level in several ways. The most common are Form 2-NDFL from the official place of work, as well as a certificate in the form of a bank. In the latter, you can also indicate unofficial profit.
Signing contracts and processing mortgage papers.
All parties to the transaction draw up and sign transaction documents on the premises of the banking institution. There, the client signs the loan agreement, as well as the mortgage. It is important to check all the details and the correctness of the data of all parties involved in the transaction. Otherwise, if mistakes are made, corrections will be necessary. And this will require additional time.
Registration of rights.
The buyer also needs to visit the multifunctional center. It is advisable to do this together with the seller. A receipt for payment of the state fee for registering property rights must be attached to the set of documentation. But it is 2,000 rubles. This can be done through the Sberbank terminal directly in the Center building.
Submit the completed documents to the bank.
When the entry is made in the register, the documents can be collected from the MFC. The new owner of the apartment is given his version of the contract, an extract from the Unified State Register of Real Estate, as well as an inventory of the registration of the mortgage.
Search for real estate, its assessment
When choosing housing, you need to consider how well it meets the bank’s requirements, which the manager can introduce you to. As a rule, secondary housing must meet the following parameters:
- the apartment must be separate;
- plumbing requirements, sewerage, water supply, heating systems must comply with the requirements;
- Housing that is dilapidated, in disrepair or about to be demolished is not allowed;
- the property must be located in the mortgage coverage area;
- should be suitable for year-round living.
There are also certain rules for new buildings:
- the developer must be accredited, with at least 5 years of experience in the housing market;
- comply with the assessment standards specified in Federal Law No. 214;
- no delays in construction;
- the facility must be at least 20% complete.
The cost of the selected housing should not exceed the loan amount approved by the bank.
To speed up the search time for a suitable option, you can use the services of a realtor.
Once a property has been selected, it needs to be appraised. It is carried out by independent appraisers. Often banks have their own accredited appraisal companies, the data for which will be provided by the manager.
If the bank has doubts about the reliability of the assessment, it has the right to file a complaint with the SRO and schedule another assessment procedure, for which the client will again pay. That is why it is better to immediately use the services of those companies recommended by the bank itself. A home appraisal is required to determine the value of the collateral for the bank. The service is paid by the borrower, on average 2-20 thousand rubles, depending on the type of property.
Before applying for a mortgage, an expert assessment of the property chosen for purchase is carried out
Mortgage loan insurance
Accredited insurance companies have a preemptive right to enter into contracts for insurance of mortgage real estate and the life and health of the borrower. Their insurance rates, as a rule, are the market average.
For your information
Payment of the insurance premium can be either a one-time payment or on a scheduled basis. Depending on the term of the requested mortgage loan and its amount.
The terms of real estate and life insurance are established in the loan agreement. If during this time the buyer does not provide policies and receipts for payment of the premium, the bank has different methods of influence:
- rate increase;
- early loan repayment;
- fines and penalties.
If the borrower has selected a more profitable mortgage real estate insurance program from a non-accredited company, then, in agreement with the bank, it is possible to sign the policy there as well. The presence of sanctions for this is determined by the internal regulations of the credit institution.
Approval of the apartment with the bank
How a mortgage loan is processed is an important question. The selected apartment must be agreed upon with the bank. To do this, both parties to the transaction are sent to the bank branch with a collected package of documents and an independent assessment. The following documentation must be submitted to the bank:
- purchase agreement;
- registration certificate of the purchased property;
- extract from the Unified State Register;
- a document confirming the absence of utility debt;
- copy of the owner's passport;
- personal account details.
After carefully studying the package of submitted documents, the bank decides whether the property is suitable for a mortgage. If everything is fine, then the next stage is the purchase and sale transaction.
Necessary documents to obtain a mortgage loan
To apply for a mortgage loan, several packages of documents are provided to the bank:
- documents of the borrower (passport, income documents, confirmation of ownership of property, which is transferred as additional collateral, information about children, SNILS, Taxpayer Identification Number, marriage certificate and other documents; the more information about yourself the borrower provides, the better);
- documents of the guarantor and co-borrower (as a rule, only identification and income information are required, since the main risk is assumed by the borrower);
- real estate documents (title documents, fresh extracts from the house register and the Unified State Register of Real Estate, certificate of legal capacity of the seller, seller’s passport, consent of the seller’s spouse to a real estate transaction, BTI plan).
Registration of a transaction
After the loan agreement is signed, you need to take it and the purchase and sale agreement and go to the registration authority (justice, Rosreestr, etc.). You must first pay the state fee.
To conduct a transaction with the registration authority, both buyers and sellers must submit an application indicating personal information. The application will not be considered valid without accompanying title documents and photocopies of passports. In the case where the seller’s real estate is jointly acquired property, you need to obtain consent from the spouse for the alienation, drawn up in a notary’s office.
Those who are interested in how long it takes to complete such a transaction should note that it takes about 30 days to register a regular purchase and sale agreement. Registration of a transaction with an encumbrance takes about 5 business days.
Upon completion of registration, the buyer receives title with encumbrance. The property is pledged to the bank. The signed agreement is transferred to the bank branch and only after that the procedure for transferring funds to the seller (to an account, in cash or through a safe deposit box) is carried out.
Important! It is unwise to transfer money before registration. In case of refusal, it will be problematic to return the funds.
Registration of a mortgage property in Rosreestr
According to the Mortgage Law of July 16, 1998 N 102-FZ, a mortgage can arise both by force of law and by force of contract.
In the case of lending for the purchase of real estate, there is a mortgage by force of law. If existing real estate is registered as collateral and a separate collateral agreement is signed, then we are talking about a mortgage by virtue of the agreement. Their registration procedures vary.
In the case of a mortgage, by force of law, the borrower is not obliged to provide a package of documents from the bank and does not pay the state fee for registration (clause 2 of Article 20 of the Federal Law of July 16, 1998 N 102-FZ).
If there is an agreement (that is, not the property being purchased, but another object is taken as collateral and a separate pledge agreement is concluded), then the mortgagor must prepare a package of documents from the pledgee (that is, from the bank). The kit includes:
- license;
- registration certificate;
- order for the chairman of the board;
- an order to the authorized person who signed the agreement;
- certificate of assignment of TIN;
- a power of attorney for the person who signed the agreement and some other documents, the list of which can be checked with the bank.
For the transaction itself, you need to provide the following documents:
- loan agreement in 3 copies, as well as a copy of it certified by the bank;
- 2 copies of the purchase and sale agreement;
- receipt of payment of state duty;
- title documents for real estate;
- extract from the house register;
- a certificate from the guardianship authorities if the transaction affects the interests of minors;
- BTI plan;
- assessment report;
- notarized consent of the spouse of the seller and buyer;
- When purchasing a share, the notarized consent of the other owners of the premises will be required.
At the registration stage, documents can be submitted either directly to Rosreestr or to the MFC by appointment. The main difference is that you can register with the MFC for the near future, but the registration time increases by 3-4 working days (during this period, documents from the MFC are transferred to Rosreestr).
Registration of the encumbrance occurs in parallel with the transfer of ownership (if the mortgage is registered by force of law). The registration period directly with Rosreestr (bypassing the MFC) is on average 5 working days.
After registration, the buyer or his representative is given the notarial consent of the seller’s spouse (if any), copies of the registered agreement, an extract from the Unified State Register of Real Estate reflecting the encumbrance and ownership.
For your information
Banks have a contract registration service. In this case, for an additional payment, the mortgagor will only have to go to the bank to get his copies of the documents. Everything else is done by the lender’s representative on the basis of a power of attorney.
Two words about insurance
A property purchased with a mortgage and pledged to the bank until a certain time must be insured. The client can take out insurance for his life and health voluntarily.
Important! In case of refusal to insure the housing purchased with a mortgage, the bank has the right to increase the interest rate.
You can choose an insurance company yourself. However, it is much more convenient to entrust this matter to the bank, since it has already established cooperation with some reliable companies involved in real estate insurance.
The insurance contract is signed simultaneously with the conclusion of the mortgage agreement. It identifies the risks of possible loss or damage to housing. For insurance, you will need to prepare two agreements - a loan agreement and a purchase and sale agreement.
Mortgage payment process
Starting from the next month after registration of ownership with an encumbrance, the borrower must begin making monthly payments. Delay or the client’s inability to fulfill obligations can end in failure - the apartment, which is pledged to the bank, can be sold to pay off the debt. In this case, the sale will be carried out at lower prices, which is extremely unprofitable for the borrower. The bank is interested in repaying only its share. In this case, the cash deposited by the client as a down payment may not be returned at all.
Important! It must be remembered that evasion of debt payment is a punishable act.
The process of obtaining a mortgage is labor-intensive and lengthy. Citizens who want to save their time and patience can turn to a realtor for help, who will collect all the required documentation and will accompany the transaction until the very end. However, his services will not be cheap. You can deal with this issue yourself, but in this case, you need to have a clear understanding of how a mortgage is issued.
How to get mortgage approval? Answers to the most important questions
How to get a mortgage approved
Reasons for bank refusal to approve a mortgage
Re-applying for a mortgage
Errors in documents when applying for a mortgage
How quickly do you get a mortgage?
How does a mortgage affect your credit history?
Applying to banks for mortgage loans is becoming an increasingly popular tool for solving the housing problem every year. But few people know how to do this so that the mortgage is approved. For advice, we turned to experienced mortgage specialist Alina Savilo.
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How to get mortgage approval in the Stavropol Territory? Is there any correct algorithm?
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Of course, there is one throughout Russia. First of all, you need to decide on the type of property. Will it be an apartment in a ready-made high-rise building or will it be housing at the construction stage? Or is it a house with land? The choice must be made at the initial stage of the loan application.
— Do you need to indicate at what address you want to buy an apartment - Mikhailovsk, Krasnaya Street, house, apartment number... and so on?
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No, you need to know the type of housing you are purchasing - both the size of the down payment and the interest rate depend on this. "Third Rome", as a developer, offers a huge selection of real estate - nine housing formats. From one-room apartments to mansions. Next, you need to get detailed advice on mortgages - this is exactly what most clients lack. We cooperate with all leading banks and can choose exactly the bank that meets the needs of the borrower and will be most beneficial for him.
— For example?
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If you are not officially employed, we can offer a mortgage based on two documents. There are banks that work with such clients and give them mortgage approval. Some banks do not lend for any housing, but only for the purchase of apartments, some - only houses with land. We look for the best option and give our clients every opportunity to get a mortgage.
The next important stage is collecting and processing documents. We cannot collect them for the client, but we can help avoid errors or quickly correct them. For example, correctly prepare a copy of your work record book or obtain a bank certificate in the required form. From time to time, banks change the form of certificates, the methodology for filling out 2-NDFL, and so on.
Very often they bring certificates with an expired expiration date. Please remember that they are only valid for 30 days. Errors occur quite often with certificate forms; we provide information that is relevant on the day of application.
Now the volume of the package of documents has also decreased significantly. Usually this is a passport, SNILS, a copy of the work book and a certificate confirming income. If one bank refuses, we apply to another, or immediately - already at the initial stage - we apply to several at once. As a result, two out of three clients receive mortgage approval.
There is a myth that if one bank refuses, then you don’t have to contact the others - there will be a refusal everywhere. But our practice proves the opposite. And there is one more important nuance. Now, for example, our client has received approval from two banks, but one of them is ready to provide a mortgage for a much more significant amount. And he, after preliminary approval, was able to change the mortgaged property to a more expensive one. A client comes with the intention of buying a one-room apartment, and the bank approves an amount that is enough for a two-room or townhouse. And our buyers have the right to change the property and buy the housing that they prefer.
The most common reasons for refusals are bad credit history. There were different cases - in some cases I actually didn’t pay on time. And somewhere he underpaid two rubles, there is a penalty on them and he is listed as a malicious defaulter in the databases of all banks - simply because he does not repay this penny amount from month to month. It is important to quickly find the reason for the refusal and, if possible, try to correct the situation.
— Is it possible to fix something?
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An extract from the credit history is urgently ordered and the reason is sought. If it really is a matter of two rubles, then repaying it is not a problem - it’s just that often the client is not even aware of these kopecks listed on him.
— What else can influence mortgage approval?
-It happens that they refuse based on the conclusion of an expert commission. What does it mean? In this case, the reason for refusal may be, for example, an unpaid traffic fine. Or his employer did not transfer some taxes.
— Are these issues solvable? Or did they refuse and that’s it?
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Under any circumstances, there is a moratorium on re-applying for a mortgage for two months. During this time, you can pay fines and so on. And we have many cases where after two months the client receives approval for a repeated application. And another common reason for refusal is insufficient solvency. For example, a client has a large credit load.
— That is, even if he regularly pays his existing loans, will there be problems when approving a mortgage?
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Yes, this option is possible. As soon as the total payment on all loans exceeds a certain percentage of the declared and confirmed amount of income, the bank considers further lending unsafe. And you will need to find a co-borrower - for example, a spouse or another relative. Or repay some of your existing loans ahead of schedule. Or add information about any additional income not previously taken into account in the calculations.
— Can errors in documents cause a refusal?
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This is rather the reason for the increase in the processing time for the application. Errors are corrected and documents are sent again. Anything can happen in life. One client had an error right in his passport - the department code was indicated incorrectly, he had to help with an emergency passport replacement - but everything was eventually resolved successfully.
— Ultimately, how long does the process of obtaining a mortgage take?
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Here it basically all depends on how quickly the client can quickly and correctly collect documents - this is the main factor. From the moment the complete package of documents is received until the bank’s decision, as a rule, no more than three working days pass.
— How does a mortgage affect your credit history?
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This is always a huge plus. Actually, any loan that is repaid in accordance with all the rules and without complaints is always welcomed by banks. In fact, if the client has sufficient solvency, he can be issued up to three mortgage loans. If you take the first one, stick to the payment schedule, the bank can issue a mortgage for another property. Some banks in their credit programs, if the mortgage is repaid on time, are ready to provide subsequent loans at a reduced interest rate.
