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The mortgage of living quarters is regulated in Belarus by special norms: Art. 52-53 of the Law of the Republic of Belarus “On Mortgage”. Mortgage is a pledge of immovable property.

The mortgage agreement must be concluded in writing and is considered concluded from the moment of its registration with the state registration agency and land cadastre at the location of the dwelling.

At once it is necessary to note that an apartment or a dwelling house, even if it is the only one owned by the owner, can be seized and sold in order to repay the debt, if it is in a mortgage.

Now about the specifics of residential mortgage.

In Belarus, only mortgages of residential premises that are privately owned by citizens or property of organizations are allowed. Mortgages of residential premises of the public housing stock are not allowed.

For transfer to the mortgage of a residential premises owned by a citizen on the right of ownership, a written consent is required:

  • adult members of his family;
  •  former members of his family living in this residential area;
  • citizens living in a dwelling provided by a testamentary refusal or on the basis of a contract of lifelong maintenance with dependents.

The only exception is when the dwelling was mortgaged under a mortgage agreement to secure repayment of a loan granted for the acquisition or construction of a dwelling premise and interest on it.

It should be noted that citizens who have agreed to alienate or pledge living quarters and are not specified in the alienation contract as citizens who retain the right to use the dwelling premise may be evicted at the request of the new owner without the provision of another dwelling.

Former family members in accordance with clause 3 of Art. 1 of the Housing Code are citizens of the Republic of Belarus, as well as foreign citizens, stateless persons permanently residing in the Republic of Belarus, who have lost the status of a family member of the owner as a result of divorce, deprivation of parental rights, termination of a written agreement on recognition as a family member. Former family members must live in the owner’s home.

Testamentary refusal under Art. 1054 of the Civil Code is the assignment to the heir by testament of performance at the expense of the inheritance of any obligation in favor of one or more persons, both incoming and not included in the number of heirs by law. Such an obligation, including the granting to another person of the right of lifelong use of a dwelling or a certain part thereof. In the case of granting the right to use the living quarters for a living space for legacy, legatees are not subject to eviction in the event of the realization of the mortgaged accommodation.

In accordance with Art. 572 CC under the contract of life-long maintenance with a dependent (a kind of the contract of rent) the receiver of the rent – the citizen transfers the real estate belonging to him to the property of the payer of the rent. The payer of the rent in this case who undertakes to carry out lifelong maintenance with the dependent of the citizen and (or) the third person (persons) indicated by him. In this case, according to Art. 575 CC any transfer to the mortgage of real estate, transferred to the payer of rent to ensure lifelong maintenance, is allowed only with the prior consent of the recipient of the rent.

Only with the written consent of the guardianship and trusteeship authority is it possible to transfer to the mortgage of the living quarters in which:

  • Minors, including minor owners of residential premises;
  • Limited active and incompetent;
  • Former members of the owner’s family, recognized as being in a socially dangerous situation or in need of state protection;
  • Orphans or children left without parental care, in relation to the dwelling premise assigned to them.A minor who is in a socially dangerous situation is a person under the age of 18 who is in an environment in which his basic life needs are not met; Which, due to homelessness or neglect, commits offenses; Parents, guardians or trustees of whom conduct an immoral lifestyle that has a harmful effect on the minor, abuse their rights and (or) abuse him or otherwise improperly perform the duties of his upbringing and maintenance, and therefore there is a danger to his Life or health (Article 1 of the Law of the Republic of Belarus “On the basics of the system for the prevention of neglect and juvenile delinquency”).

In Art. 76 ZhK are listed the grounds for refusal to give such consent to the guardianship and trusteeship body, namely if the pledge of residential premises can significantly worsen housing conditions or harm the interests of minors or property status.

Under the essential deterioration of housing conditions are understood: a) the provision of a living space with a total area of less than 15 sq. M (in the city of Minsk – less than 10 sq. M.) Per person in case prior to that the security was within the framework of this standard; B) discrepancy of living quarters with sanitation and technical requirements established for living; C) discrepancy of living quarters with typical consumer qualities, if the occupied premises meet such qualities.

The mortgage agreement must be concluded in writing and is considered concluded from the moment of its registration with the state registration agency and land cadastre at the location of the dwelling.

Failure to comply with the form of the mortgage agreement and (or) the requirements for its state registration entails the invalidity of the mortgage agreement.

The mortgage agreement must specify:

  •  residential premises that are the subject of a mortgage: its name, location and sufficient description for identification, cost;
  •  the essence, size and term of the performance of the obligation secured by the mortgage (for example, a loan agreement for monetary funds secured by a mortgage).

The draft mortgage agreement can be submitted by the parties to the transaction or compiled by the registrar. If the draft agreement is submitted by the parties to the transaction, the registrar must check whether the contents of the agreement correspond to the parties’ actual intentions, whether the transaction is contrary to the legislation of the Republic of Belarus, whether all essential conditions are specified in the contract.

The registrar must verify the identity of the parties, after which he decides on the receipt of documents submitted for the certification of the contract, or on the refusal to accept documents.

The parties sign a mortgage agreement in the presence of the registrar.

The foreclosure of the mortgaged residential premises is possible both in judicial and extrajudicial manner.

Persons living in a mortgaged residential building on the terms of a contract of employment or sublease of a dwelling are not liable to eviction when the mortgaged premises are sold. The contracts concluded with them prior to the conclusion of the mortgage agreement, or the sublease of the premises, remain valid.

Persons living in a mortgaged living quarters that have been granted the right to life tenure by a living quarters for testamentary refusal are also not subject to eviction when the mortgaged premises are sold.

The enforcement of a share in the right of common ownership of the common property of a multi-unit residential building can only be carried out with the simultaneous application of levy on an apartment in this house.

Realization of a dwelling, bypassing a court, is allowed on the basis of a notarially certified agreement between the pledgee and the pledger. Such an agreement should contain a provision on granting the right to the pledgor, or to the pledgee, or to another person, at the parties’ choice, to sell the premises. Mortgage does not provide for the transfer of ownership of the mortgaged residential premises to the mortgagee.

Residential premises, encumbered by a mortgage, are sold at public auction for the highest bidder offered at the auction.

Alexander Zhuk, Master of Law, Director of the law firm “SPRAVA Consulting”.

A source: www.nb.by