Mortgage by force of law: what it is, features and requirements

What is a mortgage by law?

The word “mortgage” itself means the purchase of real estate as collateral for real estate - either the one that was purchased as a result of receiving a loan, or the one that the borrower owned before contacting the bank.

Buying real estate is, first of all, a transfer of ownership rights, registered in Rosreestr. When a new right arises (the owner of the property changes), then the transaction is considered completed. But the order in which property rights are transferred and what is pledged is the answer to the question of what a mortgage means by force of law.

In simple terms, a mortgage, by virtue of the law according to the Civil Code of the Russian Federation, is a transfer of ownership rights to real estate as a result of receiving a loan from a bank . That is, the bank issued a loan and the money was used to buy housing.

Legally, this means that registration of a new home owner is carried out in accordance with Article 77 of the Federal Law of July 16, 1998 No. 102-FZ “On Mortgage (Pledge of Real Estate" or Article 488, paragraph 5, Article 587, paragraph 1 of the Civil Code Russian Federation.

A transaction by force of law is not only the most common scheme of action among all banking organizations in Russia, but also the safest and legally verified.

What does a legal lien on real estate mean?

Next, we will consider what the right of pledge is and whether there is a difference between it and the rights of the pledgee, the concept of the moment at which the pledge right can be considered as having arisen, and some other issues.
In general, a pledge is a legal relationship that develops as a result of the interaction of the pledgee and the pledgor and provides each party with certain rights and obligations.

One of the fundamental rights reserved to the pledgee by force of law is the possibility of obtaining satisfaction from the value of the pledged item in preference to other creditors of the debtor. The concept of this right is reflected in Part. In addition to the main right of the mortgagee, by force of law there are additional ones specified in Part.

• Mortgage of real estate by force of law.
• What does a mortgage mean by force of law and differences from a mortgage by force of contract?
• What is meant by an encumbrance on an apartment and how does it threaten the owner?
• What is a deposit under the law for an apartment?
• Registration of a mortgage by force of law under a real estate purchase and sale agreement.
• Pledge by force of law in Rosreestr, what does it mean?
• What does a pledge mean by force of law on the Rosreestr website?
• What does a legal lien on real estate mean?

Pledge of real estate by force of law

Hello, Konstantin! This means that the property is encumbered by a mortgage by force of law, that is, in other words, it is pledged. This is information about a building that is currently undergoing reconstruction.

Apartment sales are open. What risks might there be? I can't say anything about the risks. In each case, you need to look at all the documents.

VIDEO ON THE TOPIC: Public auction for bankruptcy: removal of collateral by force of law

What does a mortgage mean by force of law and differences from a mortgage by force of contract?

All the most important things: what should be in the charter and what may not be indicated; how to write statutes correctly; a little criticism of the standard forms of charters proposed by the Ministry of Economic Development and the Federal Tax Service; and of course, Alexander’s invaluable experience over the years. It will be interesting! Waiting for everybody! Webinar program and ticket ordering.

Almost everyone dreams of having their own home, be it a small apartment or their own house. In modern economic realities, it can be problematic to save up even for a few square meters, not to mention the possibility of mortgaging existing housing.

The borrower should know. Delinquency and collectors. Bonuses and promotions of microfinance organizations. MFO and collectors market news. All MFOs.

What is meant by an encumbrance on an apartment and how does it threaten the owner?

A significant part of the residential real estate market consists of apartments under encumbrances, ranging from a common mortgage to a rare easement for apartments. The essence of real estate encumbrance is the emergence of separate rights to it of persons who do not own the apartment.

The Registration Law contains the concept of encumbrance - these are conditions that constrain the owner of an apartment in the use and disposal of it, giving rise to the rights of third parties. Encumbrances on an apartment may arise from a contract, an agreement between the parties, or on the basis of a judicial act that has entered into force. The mortgagor transfers his apartment to the bank as mortgage collateral.

The pledge can also serve as protection of the rights of the owner of the apartment if it is transferred to a trustee, because it can only be sold with the consent of the pledge holder. Rent or lifelong maintenance with dependents are types of encumbrances on an apartment that allow you to solve the problem of purchasing housing through payments or actions specified in the agreement.

But these restrictions also have their own risks, in particular, the emergence of heirs to the apartment challenging the right to it.

What is a deposit under the law for an apartment?

Mortgage by virtue of the law clause. If the purchase and sale agreement for a real estate property states that the Buyer makes payment after the transfer of ownership of the property to the Buyer, then according to clause.

For some, this is a concept that is far from reality, for others it is a pipe dream, and for others, it has already been possible to use this type of real estate financing. Today, a mortgage is for many the only possible way to improve their living conditions.

Its mechanism was created for more intensive development of the lending market.

The Department of Innovative Development and Corporate Governance of the Ministry of Economic Development of Russia further - the Department, together with Rosreestr, considered the appeal on the issue of state registration of mortgages by force of law and reports within the framework of its competence.

The Department of Innovative Development and Corporate Governance of the Ministry of Economic Development of Russia further - the Department, together with Rosreestr, considered the appeal on the issue of state registration of mortgages by force of law and reports within the framework of its competence.

In accordance with the Regulations on the Ministry of Economic Development of the Russian Federation, approved by the Decree of the Government of the Russian Federation of June 5. Reception and issuance of documents for the provision of information from the state real estate cadastre.

Registration of a mortgage by force of law under a real estate purchase and sale agreement

The so-called mortgage by law, or, otherwise, the process of encumbering a mortgage by force of law, appears when there is no written agreement on mortgage lending, which contains confirmation of the lender and borrower about the pledge of some real estate. Legal encumbrance is the most common process in the mortgage lending industry. Dear reader!

Tatyana Savachenko By virtue of the pledge, the creditor under the obligation secured by the pledge, the pledgee has the right, in the event of failure of the debtor to fulfill this obligation, to receive satisfaction from the value of the pledged property preferentially before other creditors of the person who owns this property of the pledgor, with exceptions established by law. In cases and in the manner established by law, satisfaction of the creditor's claim on the obligation of the pledgee secured by the pledge may be carried out by transferring the subject of the pledge into the ownership of the pledgee. A pledge arises by virtue of a contract. A pledge also arises on the basis of the law upon the occurrence of the circumstances specified therein, if the law stipulates what property and to ensure the fulfillment of what obligation is recognized as being pledged.

Pledge by force of law in Rosreestr, what does it mean?

I want to buy an apartment, I took an extract from the registry, and it says that there is a restriction on the deposit by force of law. What does this mean? Sincerely, Zhemkov Andrey Alexandrovich. E-Mail: zhemkovandrey mail. N Federal Law from

Pledge by force of law Mortgage by force of law, what does it mean When registering real estate as collateral under the procedure of mortgage by force of contract.

This means that at any time the mortgagee can come and foreclose on the specified apartment.

And please note that in the event of a transfer of ownership of the pledged property as a result of paid or gratuitous alienation of this property or in the manner of universal legal succession, the right of pledge remains in force under Art.

Good afternoon Alexander! This wording in the statement indicates that the apartment is pledged to a third party, most likely a bank. Probably the seller once bought an apartment with a mortgage or has a loan secured by real estate.

What does a pledge mean by force of law on the Rosreestr website?

Today we’ll talk about what a mortgage is by force of law. Many people associate the term mortgage exclusively with the procedure for obtaining housing on credit, but it is a common misconception.

A mortgage is a pledge of real estate, which will be encumbered under a loan agreement, installment plan or other obligations provided for by law.

There are two concepts - mortgage by force of law and mortgage by force of contract; the features and differences of these types of transactions will be discussed further.

WATCH THE VIDEO ON THE TOPIC: gtime96.ru: What is a mortgage by force of law and a mortgage by force of contract? #04

A mortgage is a form of collateral in which the mortgaged real estate remains the property of the debtor, and the creditor, in the event of the latter’s failure to fulfill his obligation, acquires the right to receive satisfaction through the sale of this property.

A mortgage is also a pledge of the owner’s existing real estate for the purpose of obtaining a credit or loan, which will be used either for repairs or construction, or for other needs at the discretion of the borrower-mortgagor.

In case of failure to fulfill the main obligation, foreclosure is applied only to the pledged real estate, and the mortgagee has a priority right to satisfy his claims over other creditors of the debtor.

The main legal acts that regulate mortgage issues are:.

Article Concept and grounds for the emergence of a pledge 1.

The special case of mortgage is provided by law in Art. Accordingly, the mortgage will be registered both on the building and on the right to lease the land plot. Failure to submit this application will result in denial of state registration.

It should be noted that a mortgage is subject to state registration by force of law.

State registration of a mortgage by force of law is carried out on the basis of an application from the mortgagee or mortgagor, or a notary who has certified the agreement giving rise to a mortgage by force of law, without paying a state fee.

Source: https://gtime96.ru/pomosh-advokata/zalog-v-silu-zakona-na-nedvizhimost-chto-znachit.php

What properties does it apply to?

• A residential property in exploitable condition - a house or apartment - purchased partially or fully with loan funds from the bank;
• Any product, including commercial and residential real estate (it does not matter what operating status the product has), for which an installment plan or loan was issued. Such goods remain pledged to the seller until the last payment for the property is made;
• Any piece of real property obtained as a result of the execution of a rental agreement.

But it is no longer possible to obtain a mortgage for the following types of real estate by virtue of the law :

• If housing or real estate cannot be privatized - or, conversely, are subject to mandatory privatization by law;
• If the objects were withdrawn from circulation (excluded from the list of operating buildings due to emergency conditions or other reasons);
• If an object of real estate cannot be recovered in any way due to the restrictions in force in relation to it.

Removal of encumbrance by force of law

Dear Elena! If you purchased an apartment using your own funds and maternity capital, then there is no mortgage by law. Contact the authority that registers rights to real estate and transactions with it, find out where your encumbrance comes from. Possibly an error. Good luck,

Anna, you need to prove that you transferred the money in full :) You can easily get a statement of your account, but only a court can request a statement of the account of the deceased (former) owner of the apartment from the bank. Thus, after receiving all the documents, the court will have no choice but to recognize you as the rightful owner and oblige the Office of the Federal Service for State Registration, Cadastre and Cartography to remove the encumbrance. Indicate as the Defendant the Seller, a third party: Management. And file a petition to obtain documents.

What is best for the borrower?

It cannot be summed up unequivocally that one format brings more benefits to the borrower, and another less. It all depends on the situation.

A mortgage loan is legally convenient and beneficial to all parties to the transaction if everything goes “on the beaten path,” i.e. there are no conditions and requirements, only upon the occurrence of which registration or transfer of funds must occur, there are no additional parties to the transaction, or any other difficulties.

But these advantages become irrelevant as soon as nuances appear in the transaction that are not regulated by the standard package of legal documents. Then, on the contrary, it is the mortgage loan that, by virtue of the contract, can provide the greatest protection to both the borrower and the other parties, because

the agreement will further clarify and legitimize those very nuances not regulated by law.

Grounds for the emergence of a mortgage

From a legal point of view, a mortgage is a pledge of real estate. The property pledged guarantees the security of the borrower's obligations to the lender, and in case of failure to fulfill them, the lender will have the right to sell it and use the money received to pay off the client's debt.

The current legislation of the Russian Federation provides for 2 types of grounds for the emergence of a mortgage:

• Mortgage by force of law.
• Mortgage by virtue of an agreement.

Is it possible to replace it with a mortgage by virtue of an agreement?

To understand what it is - a mortgage by force of law, it is necessary to distinguish its other type - mortgage by force of contract. It is possible when completing a transaction with a property that the future borrower already owns, which he transfers as collateral. It is also possible that the borrower receives loan funds, registers ownership and only then transfers the property as collateral to the bank. Without registration as collateral, a mortgage by virtue of an agreement is also possible, in which case an encumbrance does not arise.

This direction has certain risks, since there is a possibility that the funds issued will not be returned. It is impossible to determine the type of mortgage on your own. It follows from the subject of the mortgage and the method of disposing of the funds received.

Normative base

The main legislative act regulating mortgage issues is the law of July 16, 1998 No. 102-FZ “On mortgage (real estate pledge)”. It was there that the concepts of mortgage “by force of law” and “by force of contract” were introduced.

The first means the relationship that arises between the pledgor and the pledgee as a result of the occurrence of certain circumstances, regardless of the wishes of the parties. The second reflects the situation when the parties to the transaction explicitly express their will regarding the agreement to secure obligations and the subject of the pledge.

Features of state registration of mortgages by virtue of law and agreement are standardized by Art. 20 of Law 102-FZ and Art. 53 of the Law of July 13, 2015 No. 218-FZ “On State Registration of Real Estate”.

Briefly about the differences between the two forms of mortgage

To summarize the differences, it would look like this:

• Registration procedure: a mortgage, by virtue of the agreement, must be registered separately, and the documents must be submitted to the Unified State Register of Real Estate together with the mortgagor and the mortgagee. When drawing up a mortgage agreement, by force of law, the registration process occurs simultaneously with the registration of rights in the Unified State Register by the new owner. The pledgee and the pledgor may submit documents to the government agency separately.
• Registration of a mortgage by law implies the intended use of funds, in which the purchased property automatically becomes collateral. Under a contractual mortgage, there may not be any collateral, but the owner’s real estate may act as an encumbrance.
• The process of registering a mortgage by force of law does not provide for the need to pay a state fee, which cannot be said in its contractual form.

Pledge of real estate: a little theory and practice

The transfer of real estate as collateral (mortgage) is a way to ensure the fulfillment of the obligations of the mortgagor to the mortgagee. It lies in the fact that the mortgagor (owner of square meters) is limited in the right to dispose of his property until the fulfillment of obligations to the mortgagee.

For the latter, on the contrary, a pledge means the right to dispose of property upon the occurrence of certain circumstances.

Most often, real estate collateral, especially residential, is used when issuing bank loans to individuals.

Real estate is one of the most expensive objects, so the size of loans for it can reach significant amounts. Thus, Sberbank for most mortgage programs indicates only the minimum loan amount, and the online calculator allows you to make calculations for tens of millions of rubles.

As a rule, mortgage loans are issued against the security of purchased real estate; in this case, simultaneously with the transfer of rights to the buyer, a mortgage arises by force of law. Indeed, for many, an apartment purchased with borrowed funds is the only asset for which banks are willing to lend money.

But another option is also possible: the borrower takes out a loan from the same Sberbank for any purpose secured by real estate. Here a mortgage already arises by virtue of an agreement, and loan funds are used, for example, to purchase new real estate or for other purposes.

Distinctive features

Correct classification of existing legal relations within the framework of collateral obligations will allow not only to register the encumbrance according to the rules, but also to determine whether payment of state duty is necessary in a particular case.

For easy understanding, the distinctive features are presented in a table.

Registration of a mortgage by force of law is relevant for all mortgage loans, including those issued under special government programs. Encumbrance of property under the rules of mortgage by virtue of an agreement is used by representatives of large and medium-sized businesses to open a line of credit or obtain loans for the development of their activities, as well as by individuals in mutual lending secured by real estate.

A mortgage is an encumbrance of real estate with collateral. A mortgage is most often understood as an encumbrance in connection with obtaining a loan for the purchase of real estate.

A mortgage loan secured by real estate can be issued in different ways: through a separate collateral agreement or by drawing up a real estate purchase and sale agreement, which will indicate the use of loan funds. The type of mortgage that arises depends on the choice of the method of registration of collateral.

Statement of claim for removal of encumbrance

According to Part 1 of Art. 352 of the Civil Code of the Russian Federation, the pledge is terminated with the termination of the obligation secured by the pledge. The termination of the mortgage must be noted in the register in which the mortgage agreement is registered (clause 2 of Article 352 of the Civil Code of the Russian Federation of the Russian Federation).

July 20, 2009 between Ivanov I.I. and Gazprom Transgaz LLC entered into a purchase and sale agreement for an apartment with an area of ​​53.6 sq.m., cadastral number 00:00:0110105:0:2/2, located at the address: Ivanovo region, Ivanovo district, village. Ivanovka, st. Ivanovka, 1. Payment under the purchase and sale agreement dated July 20, 2009. was made partially in monthly payments, and therefore this apartment is pledged to Gazprom Transgaz LLC. The ownership of the above property was registered in the name of Ivanov I.I. 07/31/2009 Simultaneously with the registration of property rights, an encumbrance was registered in the form of a pledge by force of law for 6 years 6 months, which is confirmed by an Extract from the Unified State Register of Real Estate dated July 11, 2020.

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Subsequent pledge

Subsequent collateral is the transfer of one object as collateral under several loan agreements. In the case of a mortgage by virtue of an agreement, the subsequent mortgage is formalized by a new mortgage agreement.

The new document must include clauses about the previous encumbrance, indicating the registration entry in the Unified State Register, the date of occurrence of the encumbrance, the basis documents (number and date of the primary mortgage agreement) and the date of the extract from the Unified State Register, which confirms this information.

Expert opinion

Kuzmin Ivan Timofeevich

Legal consultant with 6 years of experience. Specializes in the field of civil law. Member of the Bar Association.

A subsequent pledge is not possible by law, since the DPA is concluded only once. If you need to take out another loan secured by the same real estate, then you need to take out a mortgage by virtue of an agreement.

The registration procedure will be standard for a mortgage by virtue of an agreement. The text must also indicate the details of the contract and information about the previous encumbrance.

The initial and subsequent agreements must specify the same procedures for foreclosure of the collateral (either judicial or extrajudicial).

There are often cases when, when purchasing or constructing real estate using borrowed funds, they say that such objects are “mortgaged by force of law.” However, this is not an exhaustive list of cases when real estate is encumbered with this type of collateral.

This article is devoted to the issues of the emergence of a mortgage by force of law and its distinctive features.

How to conclude a contract for the purchase of real estate with a mortgage?

The law establishes that when including a mortgage agreement in the relevant agreement, the requirements established for the mortgage

(clause 3 of article 10 of the Mortgage Law).

A mortgage clause can be included in different types of contracts. This could be a contract of sale, exchange, rent, etc.

Let's consider the features of a mortgage by force of law when purchasing a property using credit or borrowed funds.

When purchasing real estate using credit funds, a purchase and sale agreement for the property is concluded. The parties to such an agreement are the buyer, who is granted a loan on the basis of a credit agreement or loan agreement, and the seller - the owner of the property or his representative.

At the same time, the purchase and sale agreement specifies not only the essential terms of the purchase and sale agreement, but also the essential terms of the mortgage: the subject of the agreement, the source of payment for the purchased property, the procedure for settlements between the parties, the rights and obligations of the parties, the duration of the agreement and other conditions.

To conclude a purchase and sale agreement using credit funds, a number of steps should be taken sequentially:

1. Step 1
   - choose a bank by studying the mortgage programs of various banks and the terms of their loans (interest rate, payment procedure, mortgage term, monthly payment amount, early repayment conditions, etc.).
2. Step 2
   - fill out the form and prepare documents to receive a loan secured by real estate.

As a rule, banks require the following documents:

• application for a mortgage loan in the form of a bank;
• borrower's passport;
• marriage certificate (if you are married);
• birth certificate of minor children (if any);
• documents confirming your income;
• a copy of the work book certified by the employer (to confirm work experience), etc.

If necessary, at this stage a deposit agreement or a preliminary purchase and sale agreement can be signed (Article 380, paragraph 1 of Article 429 of the Civil Code of the Russian Federation).

• Step 5
  - re-apply to the bank to issue a loan, supplementing the package of documents with: a report from an independent appraiser on the market value of real estate (Clause 3, Article 9 of the Mortgage Law; Article 11 of the Federal Law of July 29, 1998 No. 135-FZ “On Valuation Activities In Russian federation");
• a copy of the agreement on the deposit (advance payment) or a copy of the preliminary purchase and sale agreement (at the request of the bank);
• risk insurance agreement (life and health of the borrower, purchased property, etc.).

Restriction of rights and encumbrance of real estate

Encumbrance of a property is a temporary restriction of the owner’s rights to it. Mortgage is the most common encumbrance on collateral real estate. The essence of such an encumbrance is that until the housing loan is paid in full, the collateral property actually belongs to the bank.

Of course, the bank cannot do everything with the collateral real estate: sell it, let tenants into it, or register someone in it. But the mortgagor is also limited in his rights to the property during the repayment of the loan secured by real estate.

• Sell;
• Transfer for use to a third party free of charge;
• Rent out (according to the conditions of a number of banks).

All these possible actions must be agreed upon with the bank, but it is clear that the financial institution lending to the borrower will not allow him to transfer the rights to the collateral property to someone else.

However, the transfer of real estate as collateral does not make the borrower unconditionally powerless: he can register his spouse, children, etc. in it without the consent of the bank. And if a mortgage was issued by force of law, then he has every right (and must) register himself in the mortgaged housing.

After full repayment of the housing loan, the borrower/mortgagor is required to remove the encumbrance from the collateral housing.