How to privatize a cooperative apartment correctly?

The privatization of a cooperative apartment belongs to the category of controversial topics and one can hear a variety of opinions about the need for such a procedure. To avoid misunderstandings, you should learn about the features of registering ownership of this type of housing.

The concept of a cooperative apartment

Cooperative living spaces are located in houses belonging to housing cooperatives (HCS).
Such cooperatives are created by future residents for the purpose of construction and subsequent management of the house. The cost of a future apartment for each member of the housing cooperative is equal to the size of the share, after which the tenant has the opportunity to privatize the apartment (Clause 1, Article 129 of the Housing Code of the Russian Federation). The construction of a house is paid for through initial share contributions amounting to 10-30% of the total share amount ; the shareholders repay the rest after the construction of the house for several years. Until the full amount of the share is paid, residents do not have the right to own cooperative premises; they can only live in them and accommodate members of their family, as well as rent out living space for a fee (clause 1 of Article 128 of the Housing Code of the Russian Federation).

Privatization of cooperative housing means registration of ownership rights by paying the share contribution in full.

Legislative regulation of registration of rights to housing in housing cooperatives is carried out:

• chapters 11, 12 of the Housing Code;
• Art. 218 of the Civil Code.

The Housing Code describes the functioning of housing cooperatives, and the Civil Code indicates the emergence of property rights after payment of the share contribution. Until the share is paid, the owner of the apartment is a legal entity - housing cooperative.

What it is

The mechanism for purchasing housing through joining a housing cooperative was introduced during the existence of the USSR. This form of improvement of living conditions was accompanied by the payment of cash shares and was fundamentally different from the usual conditions for allocating living space at the expense of the state fund.

The legal status of an apartment in housing cooperatives (hereinafter referred to as housing cooperatives) is characterized by the following features:

• upon joining the residential complex, the list of future owners of the apartment was determined in advance, i.e. ownership can only be issued directly to the shareholder, and not to all family members (if a member of the cooperative was officially married, the housing will be distributed as joint ownership);
• real estate in housing cooperatives is not state or municipal property, which does not allow the standard rules of a privatization transaction to apply to them;
• Ownership of housing in a cooperative is carried out on the basis of the right of common shared ownership of all shareholders until a specific share is allocated to them.

Based on the legal regime of an apartment in housing cooperatives, it cannot be classified as an object subject to privatization under Law No. 1541-1. Privatization consists of re-registration of rights to state or municipal property, while cooperative housing is not included in the specified fund.

However, the existence of the right of common shared ownership of housing by members of the housing complex does not give individual shareholders the right to independently dispose of the apartment at their own discretion (sell it, exchange it, officially rent it out, etc.). To acquire such a right, the shareholder must allocate the owned share, which is possible subject to certain conditions.

Who is the owner?

To understand this, it is necessary to remember the history of this phenomenon. Cooperative apartments were not originally the property of the state. But it was not transferred into private hands either.

Instead, they were considered to belong to a legal entity - a housing and construction cooperative. And he, in turn, was a voluntary association of people who wanted to become apartment owners.

That is, citizens did not have ownership rights to apartments in the cooperative. But they could use them and were required to pay fees. As soon as the amount paid reached a certain amount - the share contribution, the cooperative participant became its owner.

But this is not the privatization of a cooperative apartment, but the implementation of participant rights.

Ownership does not come automatically. The fact of a change of owner must be recorded, that is, state registration of the right must be carried out.

Only after an entry is made in the Unified State Register and the newly-minted owner receives a Certificate of his right, it will be valid.

Differences between a cooperative and non-privatized apartment

In both cases, a person has the right to live in this apartment, but cannot inherit it, sell it or remodel it. However, a cooperative apartment can be rented out (in whole or in part) in accordance with Article 128 of the Housing Code of the Russian Federation.

In addition, the right to use housing, as well as all paid shares, are still inherited, unlike the situation with a privatized apartment. Otherwise, the general principles are the same. But if you can privatize an apartment (and, as a result, register ownership of it) for free, then in order to become a full owner of cooperative housing, you first need to pay all the necessary fees.

All residents who officially live in it have the right to privatize an apartment. And only the person who is a member of the cooperative has the right to register ownership of a cooperative apartment, and it does not matter how many people are actually registered in the premises.

Privatization – is it necessary or not?

Privatization involves the transfer of an apartment from state ownership to private hands. In other words, during privatization, an apartment owned by the state becomes the full possession of the citizen. It is worth recalling that a cooperative apartment is not initially state-owned: it was built with the money of investors and belongs to them until the share is paid in full. Therefore, the answer to the question: “Should we privatize a cooperative apartment or not?” can be answered: do not privatize.

It is important to note one feature: when real estate is privatized, its owners become citizens living in the apartment and having registration at this address. A cooperative apartment belongs only to the cooperative member; other family members can only live in it

However, the spouse of a cooperative member can claim an apartment, which will be common property. It can also be passed on by inheritance or gifted to an adult family member.

Is it necessary to privatize a cooperative apartment?

Using the concept of “privatization” in relation to a cooperative apartment is incorrect. Privatization refers to the transfer of property, in this case apartments, from state ownership to private ownership.

But a cooperative is not a state, but a legal entity. That is, his property is already private.

Another difference between privatization is that it involves the free transfer of apartments to new owners. And the cooperative transfers the rights to housing only after payment of a certain amount.

Moreover, the need for these expenses was known in advance, upon joining the cooperative.

It turns out that the very question of whether it is necessary to privatize a cooperative apartment is meaningless, since the state and the municipality did not have any rights to it initially. It’s true that the housing cooperatives that acted as owners no longer exist. Instead, according to the requirements of the law, HOAs arose.

But to register your right to housing, the share payment for which has been fully paid, you need to:

1. Otherwise, this apartment cannot be disposed of, since there is no confirmation of the right to do so.
2. Those certificates issued by the cooperative itself have no legal force.

Ownership does not arise automatically, even if obligations to the cooperative have been fully fulfilled. It must be confirmed by registration.

Otherwise, it will not be possible to conduct any transactions with this property:

• sell;
• exchange;
• bequeath, etc.

Is privatization mandatory?

Privatization is a term that describes the process of transferring state or municipal housing into private ownership. It does not apply to cooperative square meters, since they never belonged to the authorities. But these are legal subtleties, because the result is the same - registration of full ownership of housing. Regardless of the nuances of terminology, let’s consider whether it is necessary to privatize a cooperative apartment.

No one can oblige a shareholder to register privatization of his/her housing. There are no penalties for this. Whether privatization is necessary is decided by the owner himself in each specific case.

However, when making a decision, you need to consider the following facts:

• unregistered cooperative housing cannot be sold, donated, bequeathed or otherwise disposed of;
• without documents, it is impossible to mortgage housing or transfer it as collateral for a mortgage;
• It will also not be possible to divide the apartment between children until the paperwork is completed;
• in case of disputes, you will have to prove that the share was paid in full, look for archival certificates and witnesses. The issued rights can be confirmed at any time by an extract from the Unified State Register.

On the other hand, the privatization of a cooperative apartment frightens citizens by the fact that they will have to go to authorities, waste time and money to obtain papers, in some cases archival ones. In fact, the procedure is not at all complicated.

If the share was paid before 1997

In everyday life, there is a belief that privatization of a cooperative apartment is not required if the money was fully contributed before 1997. In reality, the difference is only in the order of confirmation of ownership.

In 1997, legislation on real estate registration appeared, which ultimately led to the creation of the modern Unified State Register of Real Estate. Until this moment, another registration procedure was in effect - through the BTI. In this regard, if the share was paid before 1997, registration of property is limited to registration of the relevant certificate in the Bureau of Technical Inventory. If desired, the owner can also register in the Unified State Register of Real Estate.

Attention! Today, the preferred option is to record the apartment in the Unified State Register of Real Estate. Even if the share was paid before 1997, it is better to contact Rosreestr and register your right.

For what?

In order to decide whether it is necessary to privatize a cooperative apartment, you need to understand what the process of entering into private ownership is and what a cooperative apartment is.

So, those who don’t remember remember, and those who don’t know, find out. Privatization is the process of converting a property from state ownership to private ownership.

This means that during this process, certain property is alienated from the state, which upon completion of this process becomes the property of a private person. In the case of apartments, in this process the property is alienated from the public housing stock and transferred into the possession of a specific person or persons.

In light of the above, it is also necessary to remember that a cooperative apartment is not listed as state property, which means that this process cannot be applied to it. How to alienate from the state what does not belong to it? For this reason, the question itself is incorrect.

If so, then it makes sense to turn to the term corporate ownership. How did it all happen? A group of citizens who wanted to solve their housing problems in the shortest possible time united on a voluntary basis into a housing construction cooperative.

Such membership-based associations could be created by both citizens and legal entities. It turned out that the apartments in the cooperative association belonged to this association as property rights. The member of the cooperative who occupied this apartment was required to pay a fee on a regular basis.

As soon as the paid amount reached the value of the share contribution, this apartment became his property. But all outbuildings along with the surrounding area remained in the ownership of the association.

Upon completion of the payment of the share contribution, the member of the cooperative received a Certificate stating that he has the right of ownership of the apartment in this cooperative. But this is in no way identical to the privatization process.

The new Housing Code of the Russian Federation, introduced in 2004, established that all cooperative associations in which members have fully paid share contributions must be transformed.

These associations should change the cooperative form to a homeowners' association. If this transformation does not occur, then such cooperative associations must be liquidated based on a court decision.

That is, to the question of whether it is necessary to privatize a cooperative apartment, the unequivocal answer follows that the privatization of such apartments is not required. But this does not mean that nothing needs to be done.

Remember that the owner of a cooperative apartment must have a Certificate of state registration of ownership of this housing. And if he does not have such a document, then he will have to obtain it.

What does this mean? The opinion that the owner of a cooperative residential space, as soon as he has paid the contribution in full, automatically becomes his private property is erroneous. As erroneous as the opinion that such housing needs to be privatized.

At one time, the first statement was true and a member of the cooperative, who fulfilled his obligations in full, became the sole owner of the apartment. But now everything has changed and ownership of an apartment can only be obtained after passing state registration.

In this case, it makes no difference when the share contribution was paid - before it became necessary to register the property right or after. If the property has not passed this registration, then its owner will not have the opportunity to dispose of this apartment at his own discretion.

This means that he will not be able to sell it, exchange it, or even bequeath it. But all this is possible immediately, after registering property rights in accordance with current legislation.

How to privatize a cooperative apartment

When registering ownership of cooperative housing, you should take into account the day on which the share was paid in full. If this happened before 1997, that is, before Federal Law No. 122 “On State Registration of Rights...” came into force, then a certificate from the BTI will be needed to carry out the procedure. If the last share payment was paid later than 1997, you can immediately apply for registration of property rights to the territorial office of Rosreestr.

Order

Rights to cooperative apartments arise for shareholders immediately after the apartment building has been erected and they are given a certificate that the share contributions have been paid in full. In fact, this document does not have any legal force, since the registration system in the Russian Federation operates according to slightly different principles.

Before submitting an application to the registrars, the shareholder must make sure that all the conditions necessary for registration of ownership rights are met:

• the rent for the apartment has been transferred in full;
• the area of ​​the apartment corresponds to the size of the share assigned to the shareholder;
• The housing complex has constituent documents, copies of which it can issue to the shareholder for submission to the registration authorities (this document will be required only if the shareholders have not previously registered housing from this cooperative).

Procedure

Registration of ownership of housing in a cooperative involves the separation of separate residential premises from the common property. If the privatization program involves the allocation of apartments to the entire circle of shareholders of a housing cooperative, then it must be taken into account that registration can only be carried out directly by the shareholders themselves; other persons (except the legal spouse) living together with him/her cannot claim cooperative square meters.

After ownership has been confirmed and registered, the registrar will issue an extract from the Unified State Register to the applicant. This paper has the status of a title document for an apartment and gives the right to dispose of square meters.

Example. Husband and wife Ivanov decided to join the ranks of shareholders of a housing cooperative in 2000. We paid all the necessary fees and moved into a new cooperative apartment. Having received a certificate of full payment for the share, they constantly postponed the registration of ownership. In 2010, the Ivanovs divorced, and the woman moved into a rented apartment. After which her ex-husband, who according to the documents was considered the main shareholder, quickly registered the housing in his own name. Having learned about this, Ivanova asked to be allocated her legally due share in the apartment. Having received a refusal, the woman filed an application with the court. After hearing the arguments of the parties, the judge fully satisfied the claims, since the disputed apartment was actually purchased from the housing complex during the marriage, and therefore is jointly acquired property.

Required documents

In order to become the full owner of a cooperative apartment, the shareholder must provide the registrar with the following documents:

• statement;
• shareholder's passport;
• certificate from the Residential Committee on full payment of share contributions (if this happened in 1997 and later);
• a certificate from the BTI confirming payment of the contribution (if this occurred before 1997);
• technical plan for the real estate being registered (prepared by cadastral engineers upon request of the property owner);
• a document confirming the transfer of rights from the shareholder to another person (for example, by inheritance);
• a receipt confirming payment of the state duty.

If in this cooperative your apartment is registered earlier than others, the registrars will require you to provide a number of additional documents:

• application for cadastral registration of an apartment building;
• package of constituent documents of a housing cooperative;
• a certificate confirming the applicant’s membership in the Residential Complex.

These documents will be entered into the cadastral database after the initial application and their subsequent provision will not be required.

Expenses

The procedure for registering ownership of cooperative housing only involves paying a state fee, the amount of which in 2020 is 2,000 rubles. Additional financial investments may be required when paying for registration of rights at an accelerated pace or when ordering turnkey privatization from a law office.

Deadlines

According to current legislation, the period for the registrar to consider citizens’ applications and make a decision on registering property rights cannot last more than 5 working days from the date of submission of documents. If all the papers are in order, then after a week you will receive an extract from the Unified State Register of Real Estate.

If Rosreestr employees find a number of errors in the documents, then state registration of property rights will be denied to you. Once you have corrected all the shortcomings, you can resubmit your application. If you believe that you received an unreasonable refusal, you can appeal the registrar’s actions in court.

Privatization of a cooperative apartment: is it necessary to do it and how to carry out the process

• certificate of payment of contribution;
• warrant for an apartment;
• list of housing cooperative members;
• a copy of the Housing Cooperative Charter;
• an extract from the minutes of the meeting on the admission of the owner to the cooperative;
• certificate of cost of living space;
• land documents;
• registration certificate of the apartment;
• cadastral passport of the object;
• copy of civil passport and TIN;
• receipt for state duty.

We recommend reading: Application to the Tax Inspectorate for the Provision of Benefits

Rights of registered

Unlike municipal property, those registered in a cooperative apartment do not have the right to take ownership of it. Only the shareholder who pays contributions to the housing cooperative has this right. However, after the death of a shareholder, citizens who lived with him have a preferential right to join the cooperative.

If the shareholder died and none of his family members joined the housing cooperative, then they even lose the right to live in the cooperative apartment.

Is this necessary?

Many people wonder whether it is necessary to privatize a cooperative apartment. In accordance with current legislative regulations, state registration is not mandatory. If a citizen has a certificate of deposit of an approved share and a warrant, then his rights to this apartment are documented.

But at the same time, a citizen cannot sell his apartment, having only the above documents, since they have lost their legal force.

If you do not register your ownership of a privatized apartment, then in practice the following problematic situations may arise:

• After the death of a cooperative member, his family members can inherit the apartment only if the share was paid in full. If the share has not been fully paid, then the apartment goes to the cooperative, and the heirs may face certain problems. A solution to this problem can be a will for a share.
• Family members who live with the shareholder have a preferential right to join the cooperative. Accordingly, after the death of a cooperative member, his rights can be transferred to the person living with him. But this is only possible if there is a similar clause in the cooperative’s charter.
• A shareholder may be expelled from the membership of a housing cooperative if he or she has not paid for the share in full. The meeting of members of the cooperative makes an appropriate decision on this. The shareholder must vacate the apartment and return it to the cooperative within 30 days after such a decision is made. If the shareholder refuses to return the apartment, the eviction will be carried out in court.

Accordingly, it is advisable to privatize a cooperative apartment so as not to encounter the above problems in the future.

How is an apartment divided during a divorce?

It all depends on whether the share was paid during marriage or not. In any case, in order to own an apartment, you first need to go through the privatization procedure. Then there are two options:

• if the share was paid before marriage, the shareholder will receive the entire apartment;
• if the share was repaid during marriage, the cooperative apartment is divided in half.

Attention! If spouses divorce and one of them is left with a child, the court may deviate from the principle of equality and award that spouse a larger share (for example, 2/3 instead of 1/2).

Inheritance

In inheritance matters, everything depends on whether the share has been paid in full or not:

• If the ownership right is paid and registered, the cooperative apartment is inherited like all other property. There is no need to join a cooperative.
• If it is paid, but the right is not formalized, the heirs will have to take a certificate from the cooperative about full payment and take it to the notary. The notary will issue a certificate of inheritance, which you need to contact the MFC. The right will be registered on the basis of a certificate and certificate. There is no requirement to join a co-op.
• If payments are not repaid, then one of the heirs needs to join the cooperative, repay the share and after that privatize the cooperative apartment. In this case, it is not the housing that is inherited, but the share.
• If there is no desire to join a cooperative, you can receive compensation for a share for a deceased shareholder. The apartment will remain the property of the housing cooperative.

Regarding the question of whether it is possible to bequeath a non-privatized apartment, the answer also directly depends on the payment of the share. A will is drawn up for housing if it has already been registered as a property. In practice, the notary will not draw up a will, even if the share has been paid out and the right has not been registered.

The circle of persons who have the right to inherit a cooperative apartment

According to the law, those citizens who are included in the 8-step priority list can enter into inheritance.

First-tier applicants include:

1. Spouse.
2. Children (natural and adopted).
3. Parents.
4. Grandchildren.

Second and third in order are other relatives if there are no first-line heirs.

The successor of each next queue can claim his share in the absence of previous queues. For example, in the event of the death of children, grandchildren will claim the property.

IMPORTANT: Please note that housing is distributed equally among relatives of the same level. If a will has been drawn up, the cooperative apartment will be distributed according to the will of the testator

He has the right to indicate not all recipients of the inheritance, as well as citizens who are not relatives to him

If a will has been drawn up, the cooperative apartment will be distributed according to the will of the testator. He has the right to indicate not all recipients of the inheritance, as well as citizens who are not relatives to him.

Advantages and disadvantages

Registration of ownership of a cooperative apartment has a lot of advantages and, in fact, only one significant drawback:

Among other things, if the building in which such an apartment is located is subject to demolition, the owner may qualify for substantial compensation. But the user will either receive less, or, what happens more often, will be forced to accept the housing that will be given to him in return for the destroyed one. Without options and choice.

In what cases can they refuse?

Let's imagine that a shareholder has successfully joined a housing cooperative, received an apartment, paid a contribution for housing and is going to register ownership... but he is refused. Are the actions of Rosreestr employees legal?

Refusals do happen, and at first they were very frequent. This is due to the status of the housing cooperative, as well as the reliability of the collected documents.

Refusal to register property rights will follow:

1. If the house was built illegally.
2. If the housing cooperative had a fictitious status.
3. If the applicant has provided an incomplete package of documents.
4. If a person who does not have the right to register acts on behalf of the applicant
5. If employees have doubts about the authenticity of documents.

Controversial issues will have to be resolved jointly with the administration. Often it comes to litigation. The applicant cannot do without qualified legal support. If you feel that you cannot cope on your own, contact our lawyers!

Nuances of privatization

The procedure for “privatization” of a cooperative apartment is the allocation of a separate living space from the general property of the house. Registration of the right will allow you to dispose of the apartment at your own discretion without regard to the board of the housing cooperative (HOA).

Features of the design of a cooperative apartment:

1. The so-called “privatization” is available only to a shareholder who has membership in a housing cooperative.
2. If a spouse joins a cooperative during the period of family life, the second spouse automatically acquires the right to residential premises - property acquired during marriage is recognized as joint and divided into equal shares between the spouses in the event of divorce (Article 35 and Article 39 of the RF IC).
3. Family members of the shareholder, even if they lived together with him, do not have the right to a cooperative apartment. Housing can be given to them as a gift or inheritance.
4. If a shareholder pays the amount of the share contribution, but dies before registering the ownership right, the right can pass to his heirs. For example, if the testator leaves a will in which he includes cooperative housing in the inheritance (Article 218 of the Civil Code of the Russian Federation).
5. If a shareholder dies, but he has a debt, the heirs will not be able to repay the remaining amount, because they are not members of the housing cooperative. However, the contributed share will be returned by the board of the cooperative. The residential premises will remain the property of the housing cooperative.

What situations might arise?

Basic points:

According to the standards of Article No. 133 of the Housing Code of the Russian Federation, a member of the cooperative who has not fully paid off his share, was expelled from the membership of the cooperative by decision of the general meeting, loses his right to use the specified premises.

In other words, within one month from the date of approval of the decision to exclude him from membership, he is obliged to vacate the apartment on a voluntary basis.

The cost of re-privatization of an apartment, see here.

Video: Privatization of official housing:

Is privatization necessary?

If you want to know whether privatization of a cooperative apartment is necessary, then Chapter 11 of the Housing Code of the Russian Federation is dedicated to it.

It follows from Article 129 that after paying the share contribution in full, a member of the cooperative becomes the owner of both the apartment and part of the common house property together with other members (Chapter 6).

The same follows from the 4th part of Article 218. Civil Code.

Before the share is paid out, the apartment is the property of the cooperative, that is, again, not state or municipal.

Important! The payment of a share cannot be called privatization. It is not needed even after payment, since the apartment automatically becomes the property of the shareholder. Thus, state registration is not of a title-establishing, but of a certifying nature

With the making of an entry by Rosreestr and receipt of a certificate, the right does not arise, but is confirmed. Read more about what privatization means here

Thus, state registration has not a title-establishing, but a certifying character. With the making of an entry by Rosreestr and receipt of a certificate, the right does not arise, but is confirmed. Read more about what privatization means here.

In this case, we are talking only about the shareholder, and not about everyone living with him and not about members of his family. Of course, if the property was acquired during marriage and is part of a joint estate, the spouse may claim a share.

But children and other relatives retain the right of residence. They also do not have to consent to registration, submit documents, refusals, etc.

For more information on how to privatize an apartment with minor children and whether this can be done without the consent of the people registered in the apartment, read the articles on our website.

This will not affect their right to subsequently participate in privatization, as provided for by law, unless, of course, the deadline for housing distribution expires.

If the shareholder has paid the share in full, then in fact this is the apartment owned by the shareholder.

At the same time, the management of house property is carried out by the housing cooperative, which is an operating organization. There are a number of differences from HOAs: governing bodies, powers, decision-making procedures and some others.

Reader question: - Do I need to re-privatize a cooperative apartment if I privatized it in the 90s and get a new certificate of ownership?

Answer: - The apartment you previously privatized is already your property and there is no need to contact Rosreestr.

FAQ

Let's look at the questions most often asked by people living in cooperative apartments.

Get a certificate for your daughter

The right to a cooperative apartment can be transferred to children or other relatives only after the transfer of this right is confirmed by state registration.

The full owner, who has a Certificate of State Registration of his right in his hands, implements it as he sees fit.

In this case, any methods of alienation are allowed:

• sale;
• donation;
• exchange, etc.

If the transfer occurs free of charge and between close relatives (parents to children), then such income is not taxed.

But when selling, the seller is required to pay tax on the amount received, even if the buyer is a relative.

Payment of shares and ownership

If you think about cooperative apartments during the times when the Soviet Union existed, you will find the following. At this time, housing could almost always be obtained only from the state. If for some reason it was too difficult to do this, there was still the opportunity to join one or another housing cooperative and start paying off your share. At this stage, ownership of the apartment was owned by a legal entity (we are talking about a cooperative). After the debt was fully repaid, the housing became the property of the owner of the apartment.

What has changed since then? The very concept of ownership of real estate of any kind has changed. This includes not only apartments, but also private houses, plots of land, as well as other types of land. Currently, it is not enough to have a title deed for ownership.

It could be:

• deed of gift;
• contract of sale;
• will;
• other similar documents.

There is a Unified State Register of Property Rights (USRP). It must contain the specified object in accordance with certain rules.

One of the important requirements is the preparation of a cadastral (technical) passport for a cooperative apartment.

Only after registration has been made, after the entry has been made in the Register, can it be argued that there is ownership of this apartment. While there is no such registration, there is no ownership right to it, despite the presence of title documents for the acquisition of real estate.

Until the money for the share was paid, the tenant had the right to use the apartment, but did not have any ownership rights to it. This requires registration. During all this time it belonged to a legal entity - a housing cooperative.