Buying a share in an apartment: pitfalls and risks

The need to purchase a share of an apartment arises in a variety of cases.

Someone buys a share to obtain a residence permit , others plan to live in the purchased living space, others use such transactions as an investment , etc.

Dear readers! Our articles talk about typical ways to resolve legal issues, but each case is unique.  

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Regardless of the reasons that prompted a person to decide to buy a share in an apartment , he should know about the procedure for carrying out such a procedure, the necessary documents and possible pitfalls.

Required documents

The first thing you need to do before concluding a purchase and sale agreement is to prepare documents. As for the buyer, all he will need is a passport and a taxpayer code .

Particular attention must be paid to the seller’s documents and the living space directly sold by him.

Start checking by studying the title documents:

• certificate confirming ownership of the share;
• agreement confirming the legality of obtaining the above-mentioned certificate (sale and purchase agreement, donation, inheritance, etc.).

The buyer only needs to make sure that the title documents are available. Their authenticity verified by the relevant authority during state registration of the transaction.

Important!

If you want to buy a share in an apartment, the buyer is recommended to check the date of conclusion of the previous contract.

If a property is resold too often , this should raise suspicions and a number of questions that need to be clarified with the seller.

If one of the parties takes part in a transaction by power of attorney, you need to find out from the notary who issued it whether this power of attorney was revoked a couple of days before the meeting with you. Illegal fraud in the real estate market is carried out quite often and this is one of the most common.

The next important document that the buyer must check is an extract from the house register .

In the case of a share, it has one very serious feature - an extract is issued only for a specific share owned by the seller.

difficult to find out what is happening in the remaining shares . And, for example, dozens of people can be registered there. Will you like this neighborhood? Hardly. To clarify the information, you need to try to get an extended statement for the entire apartment with information about potential residents.

• There must be a certificate confirming the fact of notification of the co-owners of the intention to sell the share.
• Co-owners of shared property have the right of first refusal .
• If one of the participants in shared ownership decides to sell his property, the law obliges him to notify the other co-owners of such intentions.

1 month to respond . If no one agrees to the purchase or does not respond within a month , the seller can dispose of his property as he pleases.

The difficulty is that it is impossible to verify that the notification was delivered to the recipient. Unscrupulous sellers often practice the following scheme: they send a notice addressed to the co-owner, and upon delivery they present it to the postal service employee as the recipient. The notice was both served and not served.

You can play it safe by writing down the entire amount of the transaction in the purchase and sale agreement, so that if conflict situations arise, you do not lose your money.

Agreement for the purchase of a share in an apartment

1. After completing the verification of all necessary documents, you can proceed to concluding a purchase and sale agreement.
2. In the case of shares, it is practically no different from a similar agreement for transactions involving “full-fledged” apartments.
3. To draw up an agreement, it is best to contact a lawyer, realtor or notary.

You can, of course, find some kind of ready-made agreement on your own, but if you don’t understand this, it is recommended to refuse . And you will spend a lot of time editing and finalizing such an agreement.

The law allows sales contracts to be concluded in simple written form without notarization. Decide for yourself here. The cost of this specialist’s services usually reaches 1% of the transaction price.

To conclude an agreement, you can choose a real estate agency office, a cozy restaurant or any other place.

But it’s best to do this in the bank’s meeting room , whose services will be used by the seller and buyer to make payments.

Address and exact characteristics of the property being sold.

Before signing the contract, the buyer is recommended to personally visit the apartment in which he is purchasing a share, examine the situation, and check that the street, house and apartment numbers correspond to those specified in the contract.

Also, the essential terms of the contract include the transaction price, the date of conclusion, the terms and procedure for releasing the acquired property. It is better for the share to be released before signing the contract.

• The contract file must contain detailed information about the parties to the transaction, title documents, certificates and the procedure for distributing shares in the apartment in question.
• An annex is added to the contract, which describes the condition of the purchase object and its contents.
• It would be better if the supplement comes with photographs .

1. The first thing a potential buyer should do is check the owner .
2. The verification is multi-stage and includes the following.
3. Checking the physical and mental health of the owner.
4. You can personally clarify this information with the seller or check with the relevant authorities.
5. Study of documents confirming that the seller has ownership rights to the object being sold with additional indication of the circumstances under which he acquired these rights.

After completing the verification of the seller, you need to visit the apartment in which you plan to purchase a share and assess its condition , talk with neighbors, etc.

This point is important only in cases where the share is purchased for personal residence .

At the end, the documents for the share are checked and an agreement is concluded . The list of documents and the procedure for concluding an agreement were discussed above.

"Underwater rocks"

Although buying a share is a profitable deal in some situations, it also has its own risks and pitfalls. the first risk even before concluding a contract.

For example, sellers often offer to give a share as a gift , and ask to give them money in the general manner.

Problems will arise if you are not satisfied with the purchased share and you decide to terminate the contract through the court.

In such a situation, it will not be possible , because According to the documents, you did not give him any money.

The second “pitfall” is the misconception of many buyers who “confuse” the concept of “share” and “room” in an apartment.

For example, when purchasing a 33% share in a three-room apartment, the buyer does not automatically become the owner of one of the available rooms. He receives ownership of specifically 33% of the total area of ​​the property. Whether it will be a separate room or, for example, a balcony and a storage room, you have to negotiate with the neighbors.

It is also important to understand that the buyer will not live alone . And, as practice shows, conflicts with neighbors arise very, very often. Often it comes to serious scandals and litigation.

Thus, buying a share in an apartment is a very serious undertaking for which you need to carefully prepare. Preparation should begin with checking all the documents that would normally be required by the seller.

• If the verification is successful, you can proceed to the conclusion of the contract.
• It is best to draw it up from a specialist - a notary, lawyer or realtor.
• The procedure for drawing up a purchase and sale agreement does not differ significantly from a similar agreement for “entire apartments”.
• Buying a share in an apartment has its own pitfalls, which you need to know in advance to avoid problems in the future.
• Didn't find the answer to your question? Find out how to solve exactly your problem - call right now:
• +7 (499) 938-65-46 (Moscow)

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How to buy a share in an apartment

Acquiring a share in an apartment is one of the most difficult and controversial types of real estate transactions. In this publication we will try to present the most important information regarding this issue.

What are the disadvantages and advantages of buying a share in an apartment, what should you pay attention to before making a transaction, is it possible to subsequently become the full and sole owner of a residential property that is in shared ownership - find out right now.

What is the point of buying a share in an apartment?

Let's identify several main reasons for buying a share in an apartment.

• Obtaining permanent registration.
• Investment of funds.
• Purchasing budget housing for real living.
• Plans for further redemption of the remaining shares.

Buying a share in an apartment is a legal and relatively inexpensive way to obtain registration in the desired city. At the same time, the size of the share does not in any way affect the ability to obtain official registration.

As an investment, such a step also makes sense. Far-sighted and prudent people become owners of shares in apartments, hoping to later profitably sell the entire home, buying the rest of it cheaply.

In more rare cases, the measure is aimed at acquiring a place of immediate residence, with all the “ensuing” delights of living together.

As for the last point, there is also an expectation to get housing at a price significantly lower than the market price. Even if not immediately, but after a while, during which the remaining co-owners can be persuaded to sell their shares. By the way, about the price.

Cost of a share in an apartment

Based on reality, the cost of a share in an apartment is no more than 30% of the market value of the number of square meters calculated for its volume. For example, the price of one third of an apartment worth 6 million rubles, which is in common ownership, will not be 2 million (6 divided by 3), but only 400 - 600 thousand rubles, depending on the location, square footage, layout, condition of the housing and the house , in which she is located.

If the layout and total area of ​​the apartment contribute to its division into zones that are acceptable for more or less comfortable living for all co-owners, the price may increase, and vice versa.

However, the too low cost of a share in an apartment should alert you - probably the neighborhood in it will be such that you won’t have any problems for many years.

On this note, let's move on to the negative factors of acquiring a share in an apartment.

Possible problems and risks

In fact, there are “pitfalls” of buying a share in an apartment, and they are significant. One of the main ones is the inability to allocate and assign to the co-owner a specific material part of the object. When purchasing a share in an apartment, you are not buying a room or a certain part of it, but just a “virtual” number with a fraction, which can only be converted into square meters by agreement of all property owners. And if it is not possible to reach a consensus, take legal action. Moreover, when determining the part of the property of each co-owner, the judge will take into account a lot of nuances: whether the residents have minor children, dependents, or an alternative place to live. It is possible that a more comfortable, spacious, advantageous room in some respects will go to your neighbor, who has a share of the same size as you, or even less.

Life in an apartment that is in common ownership is even more difficult than, say, in a communal apartment, where residents still have “inviolable” personal space.

Even having drawn up a written agreement about who will be located where and what boundaries not to cross, you should not relax - it will be abolished with the change of any of the co-owners.

And the process of “conquering territory” will have to start all over again.

Without the consent of the co-owners, you cannot accommodate or register someone in your part of the home (even if they are immediate relatives or family members). To achieve such goals, it is necessary initially, when registering ownership rights, to further split your share into those people whom you want to see nearby in the apartment, or who need to be registered in it.

A significant risk in purchasing a share in an apartment is the fact that you, in a sense, become dependent on the future co-owners. You cannot, without obtaining the consent of your neighbors or notifying them, perform any actions with your part of the property (rent, make repairs, etc.).

Only if you have written refusals to purchase a share on the terms established by you from the co-owners of the apartment (you need to notify them no later than 30 days before the expected date of the transaction), you have the right to sell your share to an outsider.

Some use a trick: they draw up a gift agreement and, on its basis, transfer the share to the new owner, supposedly for free (this operation does not require the consent of the co-owners of the property). However, such a transaction may be considered void if legal proceedings are initiated by disgruntled neighbors. In such a situation, both the seller and the buyer of the share in the problem apartment risk losing money.

In general, when planning to buy a share in real estate, it is extremely important to study the features of the relationship between co-owners and predict how they will affect you personally if you join a friendly or not so friendly team.

Make sure that the seller sells it, having official refusals from the acquisition of the share by the “first priority”.

In addition to considering the technical parameters and location of the object of interest, it is necessary to determine whether acquiring a share in it will allow you to achieve your goals and obtain the expected benefits.

Advantages of sharing an apartment

The main advantage of buying a share in an apartment is the opportunity to solve housing and registration problems with minimal costs. The financial aspect has been and remains one of the most significant when choosing housing.

Having a share in an apartment, you don’t have to live there - it’s an affordable type of reliable investment, for insurance for all occasions.

In addition, with the prospect of receiving a good profit if in the future it is possible to buy out the shares of other co-owners.

Having spent much less money than when buying a regular “whole” apartment, you will become the sole owner of a full-fledged unit of real estate. How to do this - read on.

Buying shares in an apartment

The easiest way to buy out shares in an apartment of other owners is with their consent. Through negotiations and discussion of mutually beneficial transaction options, it is possible to gain the support of people who were initially not inclined to part with their part of the property. The main thing is to find effective points of influence, based, most often, on the same financial interest. For example, offer your neighbors a little more for their shares than they are actually worth. Having become a full-fledged owner of a home, the attractiveness of which will immediately increase (and with it, market position and liquidity), you will not lose money.

Otherwise, nothing will work. Unless you intend to “go on the warpath”, and in war, as you know, all means are good, even not very clean ones.

It is no secret that sometimes the purchase of shares in an apartment occurs with the use of moral pressure from neighbors, through the “connection” of professional raiders.

But this is not about you and me, right? Moreover, the legislation clearly defines: the purchase of shares of real estate that is in common ownership against the will of the co-owners is illegal.

Acting according to the law, it is possible to initiate a forced buyout through the court, but only in relation to those co-owners who have insignificant shares and do not show interest in the housing. That is, they do not appear there, are not registered at the property address, do not pay utility bills, etc. After studying the details of the case, the court may oblige them to sell their shares to other co-owners.

If at this point in the discussion of the topic you are still interested in buying a share in the apartment, it’s time to find out the procedure for the operation.

How to buy a share in an apartment: stages of the transaction, what documents are needed

Before you buy a share in an apartment, you need to not only study the situation prevailing in it from the inside. Make sure the property is legally clean, the seller is legally competent (whether he is registered with a psychoneurological or drug treatment clinic), check all the documentation. By the time the purchase and sale agreement is signed, the following documents must be prepared:

• title document (certificate of ownership);
• certificate of state registration of ownership of a share in the apartment (if it was issued before July 2016, in connection with amendments to the Federal Law “On State Registration of Rights to Real Estate and Transactions with It” dated July 3, 2016);
• extract from the Unified State Register;
• a written statement from existing co-owners waiving the right of priority to purchase a share;
• an extended extract from the house register indicating all persons living in the apartment;
• written consent of the seller’s spouse to conduct the transaction, if the share in the apartment is joint property acquired during marriage.

In addition to the above list, you will need passports and tax identification numbers of all participants in the procedure. For people who do not have specific knowledge in jurisprudence, it is advisable to involve specialists in the process.

Professional real estate agents will check the availability and authenticity of the documents required to formalize the purchase and sale of a share in an apartment, assess the real prospects of the transaction, and identify possible difficulties.

If all the documents are ready, you can discuss payment methods and set a day for signing the purchase and sale agreement. It is also better to entrust its compilation to a professional. After the transaction is concluded and the ownership rights of the new owner of the real estate share are registered, full settlement between the parties occurs.

An important point: from July 15, 2016, the law abolished the issuance of certificates of state registration of rights to real estate (including repeated ones).

Registration of real estate transactions in the Russian Register of Real Estate is certified by a special inscription on the document reflecting the essence of the transaction.

State registration of the emergence and transfer of rights to real estate will be confirmed by an extract from the Unified State Register (also in electronic version).

What pitfalls can there be when buying a share in an apartment and how to formalize the deal correctly?

To solve your problem RIGHT NOW, get a free LEGAL consultation: +7 (499) 504-88-91 Moscow +7 (812) 385-57-31 St. Petersburg

Who has an advantage in acquisition?

Art. 244 of the Civil Code of the Russian Federation establishes that property can be owned by several persons - and in this case they own shares in the right to it (unless otherwise expressly provided by law).

There are no separate rules for residential real estate, and therefore it can also belong to several persons, being in their shared ownership.

In general, shared ownership gives the owner the same rights as sole ownership - but with a few exceptions.

The main one is the pre-emptive right to purchase. It is established by Art. 250 Civil Code of the Russian Federation. According to its norms, transactions for the sale of shares within the circle of co-owners and outside it differ. The difference is as follows:

1. If the owner of a share sells it to another owner of a share in the right to the same apartment, the transaction does not concern anyone else, both parties are free to complete it without informing anyone.
2. If a share is sold to an outsider, you must first offer to purchase it to those who already own the shares.

It is necessary to offer a purchase on the same terms and at the same price at which the sale to an outsider is planned.

At the same time, the law specifies that an offer must be made only in writing, consent or refusal must also be written. The offer is valid for a limited time.

If, having received the notification, the owner does not respond within a month, he is considered to have refused the purchase (Part 2 of Article 250 of the Civil Code of the Russian Federation).

How to formalize the refusal of a co-owner of the pre-emptive right?

If the seller of a share in an apartment does not want to wait a month, he must obtain a written refusal from each of the co-owners. The algorithm of actions in this case will be as follows:

1. Written notice is sent to co-owners. It is drawn up in any form, the main thing is that it contains a description of the key terms of the transaction.
   • You can send it by mail (registered mail with notification).
   • It can also be transferred from hand to hand during a personal meeting (in this case, two copies of the document are made, one of which the co-owner takes for himself, and the second remains with the seller with a note from the recipient that he has received the notification).
   • Also, according to Art. 86 Fundamentals of legislation on notaries, you can submit a notification through a notary (the agreement will still have to be certified by him).
2. If the purchase is not part of the co-owner’s plans, he writes a refusal. The document can be prepared in simple written form, but then when registering the share purchase agreement, the notary, according to Art. 15 and 45 of the Fundamentals, he has the right to request confirmation from the person who refused, postponing the certification of the contract. Therefore, it will be faster to immediately notarize this refusal.
3. After the refusal is received, you can proceed directly to the execution of the share purchase and sale agreement.

What documents are needed when registering?

Basic package

To acquire a share in the ownership of an apartment, you will need the following documents:

• Documents confirming the identity of the buyer. The law provides for different options for identification, but almost always only a citizen’s passport is used.
• Extract from the Unified State Register of Real Estate. According to the Federal Law “On State Registration of Rights to Real Estate”, since 2016 this document has served as the only confirmation of ownership; certificates are no longer issued.
• If the share is sold to an outsider - written refusals from the other co-owners to purchase, or documents confirming that they were notified.
• Certificate of persons registered in the apartment.
• Documents of title for the share (privatization agreement, donation agreement, purchase and sale agreement, etc.).
• Technical documentation for the apartment.
• Certificate of personal account with information on utility payments.

Depending on the specific situation, additional documents may be required. Some of them are worth talking about in particular.

Joint ownership with a minor child

Among the owners there may be children under 18 years of age. And in the event that their share is sold, they will need to additionally obtain the consent of the local guardianship authority.

Part 3 art. 60 IC of the Russian Federation and part 2 of Art. 37 of the Civil Code of the Russian Federation directly indicate that without this, the transaction is not allowed, and the guardianship, having received information about the sale, must immediately apply to the court with a claim for its termination.

In order to obtain such consent, you must contact your local guardianship authority.

According to the Federal Law “On Guardianship and Trusteeship,” it can be either a state or a municipal body, but in almost all regions this function is assigned to local governments.

There, the applicant must provide documents confirming that the terms of the contract do not violate the rights of the child. In particular, you can demonstrate a purchase and sale agreement for an equal share of another apartment, in which the child will act as a buyer.

Both parents must apply. The exception is when one of them is dead, deprived of his rights, or simply unknown. From the age of 14, the application must be signed by the child himself.

If permission is received, no validity period is established for it. However, letter No. 09-M of the Ministry of Education of the Russian Federation dated 1995, which is still in force, requires that the agreement be submitted to the guardianship authority within a month. Therefore, in practice it is better to proceed from this period.

Preparation of contract

There is no official form for the share purchase and sale agreement , so it is prepared by the parties in any form. It is only necessary to clearly indicate the following points:

1. Indication of the apartment in which the share is purchased. You can use both the full address (city, street, house number, apartment number) and the cadastral number under which it is registered in the Unified State Register of Real Estate.
2. The size of the share in the right that is transferred under the agreement. It should be no more than what is registered with the seller. However, it is possible to sell part of your share, in which case the buyer will become a new co-owner of the apartment.
3. The price at which the share is sold and the payment procedure.

Since only a share is being sold, and not the entire apartment, a transfer and acceptance certificate is not drawn up.

Notarization of a transaction: necessity and price

Previously, for a share purchase and sale agreement concluded between the owners, notarization was not required. However, with the entry into force of the Federal Law “On State Registration of Real Estate” the situation has changed. Art. 24 of this law indicates that any transactions related to the alienation of a share in the right of common ownership of real estate must be notarized.

Payment for a notary's work consists of two parts:

1. State duty established by Art. 333.24 Tax Code of the Russian Federation.
2. Payment for technical and consulting activities.

The amount of the state duty is clearly defined in the law - 0.5% of the value of the share. But, that amount should be no less than 300 and no more than 20 thousand rubles.

But for legal and technical work, the notary sets the price independently within the limits introduced by the Notary Chamber of the Russian Federation.

Its size is regularly reviewed and varies in each region, so the cost must be clarified before certification by a specific notary.

Registration of the agreement

After the agreement is signed and certified by a notary, you must contact Rosreestr so that new data on the ownership of the apartment will be entered into the Unified State Register of Real Estate. This can be done by contacting the local branch of the registration authority and through the MFC. Citizens who have registered accounts on the State Services portal can also submit an application electronically.

After registration takes place, the applicant can receive an extract from the Unified State Register of Real Estate, where he will be indicated as one of the co-owners of the apartment.

Features of purchasing for mat. capital

Separately, it is necessary to talk about those cases when “maternity capital” is used to purchase a share in a residential apartment - financial assistance from the state for families who have given birth to a second or half-next child.

The legislation establishes two restrictions on the use of maternal capital when purchasing a share. It can be used for payment if:

1. As a result, all housing will be the property of the buyer.
2. The purchased share can be physically allocated as a separate isolated room.

It should be noted that the restrictions are due to the fact that the certificates are intended only for the purchase of a separate home.

• It will not be possible to purchase a share for maternity capital from a spouse: their property is not in shared ownership. But if the marriage has already been dissolved by the time of the transaction, and the division of property has taken place, the mother can use the certificate to buy his half of the apartment from her ex-husband.
• According to Part 4 of Art. 10 of Law No. 256-FZ, in order to purchase a room, a house, or any residential real estate using financial capital, shares must be allocated to all family members, including minors.

You can make a transaction using a certificate for maternal capital only with the consent of the Pension Fund. Therefore, you need to be prepared for the terms of the contract to be carefully checked.

How to buy a room in a communal apartment?

The transaction for purchasing one or more rooms in a communal apartment also has its own characteristics (you will find a step-by-step procedure for purchasing a room in a communal apartment here, and read about the specifics of purchasing a room in a dorm here). The rule of pre-emptive right to purchase also applies here, so the procedure for the parties will be as follows:

1. Determining the terms of the transaction. It is possible to sign a preliminary agreement (agreement of intent) indicating in it that the transaction is canceled subject to the purchase of the room by one of the co-owners of the communal apartment.
2. The seller notifies buyers.
3. After receiving a refusal or expiration of the waiting period, documents are prepared.
4. Drawing up an agreement and its notarization.
5. Registration of rights in Rosreestr.

Ransom from a relative

However, you need to keep in mind:

1. You cannot use matkapital when purchasing - the Pension Fund will consider such a transaction as cashing out.
2. A forced redemption of a share is possible by a court decision if the share is insignificant (Part 4 of Article 252 of the Civil Code of the Russian Federation). Typically, this method is used if the owner of the share does not actually live in the apartment, does not participate in the costs of maintaining the housing, and there is a conflict situation in the family.
3. To avoid disputes as to whether the transaction is imaginary or feigned, it is imperative to document the transfer of money. Fictitious agreements between close relatives are a common fraud scheme.

"Pitfalls", risks

When concluding a contract for the sale and purchase of a share in the right to housing, there are a number of potentially dangerous situations. Dangerous situations should be taken into account by the parties to the transaction:

• If one of the co-owners does not live in it, and his exact address is unknown, search and notification can become a serious problem.
• Using a gift deed to cover up a sale or purchase made without the consent of the co-owners is illegal. Such a transaction can be challenged and canceled in court - and the money may not return to the buyer.
• Often used as a cover for a pledge agreement. In this case, the seller “borrows” from the buyer in the amount of the cost of the share. When the time comes to repay the “loan”, he, naturally, does not pay the money and the buyer acquires ownership of the share. Such a transaction is more reliable than a gift, but it can also be challenged.
• We should not forget about the tax side: the seller is obliged to pay personal income tax, and the buyer can take advantage of a tax deduction.
• All co-owners have the right to use the apartment, even if they usually live separately. Therefore, the buyer risks finding additional residents at any time.

Conclusion

Buying a share is a very real and legal transaction. However, in order to carry it out, you need to comply with a number of additional conditions that do not exist with a regular home purchase. And therefore, the parties to the contract must be attentive to the fulfillment of their obligations.

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Pitfalls when buying an apartment

Pitfalls when buying an apartment are not always encountered; approximately 10% - 15% of transactions go through like clockwork. And the apartment is legally clean and the parties to the transaction are adequate.

In other cases - either pebbles, or cobblestones, or boulders. And it’s good if they are visible - you can stop in time or be careful.

Let's leave lyrical digressions.

In this article I will tell you about hidden risks.

Article updated on January 15, 2018

You probably won’t find such a selection of hidden risks in one article in other sources. You can learn more from the training materials in the newsletter from the Author.

Pitfalls when buying an apartment are hidden risks - violations of the law, leading to voidable transactions, that is, transactions that can be terminated by a court decision. And everything would be fine, but after this the buyer is left not only without an apartment, but also without money, since it is very difficult, and sometimes impossible, to return it!

• Transactions fall into the category of voidable transactions in the event of a violation of the rights of family members, primary buyers, heirs or founders of legal entities.
• There is no need to confuse voidable transactions with void ones, which are recognized as such even without a court decision.
• Read more about void transactions later in the article: Miscellaneous real estate transactions

Violation of the rights of minors

1. This is the most common situation today.
2. -Why?
3. -Because many transactions have occurred and are occurring with the use of Maternal (family) capital, “Young Family” certificates, in which money is allocated to improve the living conditions of all family members.
4. Let's take a closer look and use examples:

Example one

The apartment was purchased using the Young Family certificate and bank loans. But according to the terms of the credit institution, children could not be included among the owners of the apartment being purchased, because in case of non-payment of the loan, it would be difficult for the bank to take away this housing.

Therefore, the apartment was registered in the name of the parents, but they gave an obligation to allocate the children to the children after the mortgage was repaid. In accordance with the requirements of the authority that issued the above certificate, a copy of this undertaking was required to be placed in the registration file.

A few years later, the mortgage was paid off, the apartment was taken out of collateral and put up for sale in order to buy a better one.

As usual, parents “forgot” about the obligation to allocate shares to their children. After all, if you complete it, then for the sale you will need permission from the guardianship authorities, and this means additional time and vanity. We decided that it would do. After all, they will definitely allocate shares to the children in the new apartment

The purchase and sale agreement was signed and the money was received. The documents were submitted to Rosreestr.

And the next day we bought a new apartment and paid for it. The seller, having received the funds, flew to another country for permanent residence.

• -And how did events develop further?
• -Guess three times!
• The registrar opened the registration file for the first transaction, and there is an obligation to allocate shares to the children! After all, the Rosreestr Archive stores information about previous transactions
• Of course, registration of property rights was refused .
• And the money for the deal floated across the border. (Not a made up story)

Example two

The apartment was purchased using our own and credit funds. Issued in the name of one of the spouses. The right is registered in Rosreestr.

1. A few years later, a certificate for Maternal (family) capital was received and used to pay off the mortgage loan.
2. In order for the money from my mother’s pension account to be transferred to the bank, the Pension Fund was provided with an obligation to allocate shares to all family members.
3. Next, the apartment is put up for sale.
4. Parents “forgot” to tell buyers about the obligation.
5. -Well, then the prosecutor’s audit of the Pension Fund.
6. -And what?
7. -The deal was declared illegal!
8. (Not a made up story)
9. To be continued…

Read a guide to completing transactions from the Author:

Always happy to clarify. Author

Pitfalls when buying an apartment

What pitfalls await you when buying an apartment on the secondary market?

Real estate purchase and sale transactions always involve certain risks for both the seller and the buyer. To avoid them and conclude a profitable deal, it is important to know what pitfalls exist when buying an apartment on the secondary market and in new buildings in 2023.

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Risks when buying a home in a new building

What are the pitfalls when buying an apartment in a new building? The main risks in such agreements are related to the unreliability of the developer. Among them:

• financial problems of the developer company;
• lack of permits for construction;
• execution of a contract for renting a plot of land to another legal entity;
• lack of project accreditation with major banks.

A developer who has such problems may go bankrupt before construction is completed . In this case, the real estate buyer will have to unite with other shareholders and look for a new company to complete the project. To prevent this from happening, you should carefully study the project documentation before starting cooperation with the developer.

It is also recommended to request information on the construction company from the Tax Service and the Arbitration Court.

What risks are associated with purchasing secondary real estate?

Purchasing finished housing from private individuals has its pitfalls. When purchasing an apartment on the secondary market with a mortgage, these may include:

• the presence of an encumbrance on the property. This category includes debts of homeowners for loans and utility payments;
• registration of minor children and incapacitated persons;
• the right to use living space of persons who have not previously taken advantage of privatization;
• prohibition on conducting a transaction on the part of the seller’s spouse. A sample of a spouse's consent can be downloaded from this link;
• non-compliance of housing with banking requirements. In this case, the bank may refuse to lend.

Transactions with distressed real estate are dangerous, for example, buying an apartment after a fire . The pitfalls of such a deal are unsuitable living conditions. Even after renovation, the smell of burning will remain in such a house. Also, in such housing, the floors may be damaged, which is why the new owners will have to carry out major repairs.

If you are planning to buy an apartment in a HOA, pitfalls will concern the cost of housing maintenance, the procedure for distributing votes in the HOA, and restrictions on the use of the total area.

What difficulties may arise when purchasing a share of real estate?

The purchase of a share in an apartment is considered a risky transaction (download a sample agreement for the purchase of a share in an apartment). The pitfalls here are:

• lack of clearly demarcated shares. Because of this, owners will have problems using the property in the future. A sample agreement on determining shares can be downloaded here;
• the presence of utility debts among other homeowners, due to which access to electricity, water, and gas may be limited. These are the most common pitfalls when buying a share in an apartment;
• unsatisfactory condition of common areas.

What are the pitfalls of buying a room in an apartment? It may turn out that the former owner did not offer the owners of other shares to buy out this property . In this case, the housing sale transaction may be challenged in court.

What to look for when buying real estate from an heir?

What difficulties might be associated with buying an apartment from an heir? The pitfalls in such cases are:

• too many claimants to inheritance with equal rights;
• the presence of a will, according to which a third party receives ownership rights. A sample will can be found at this link;
• violation of the rights of other heirs;
• the existence of persons who have an undeniable share.

In all the presented cases, the right to home ownership can be appealed in court. At the same time, a bona fide buyer will not be able to count on compensation after the property is transferred to another owner.

What risks are associated with purchase and sale agreements?

Separately, you need to consider the pitfalls of the apartment purchase and sale agreement, which can be downloaded here. These include:

• indication in the contract of the undervalued cost of housing;
• lack of exact deadlines for eviction and deregistration of former residents;
• lack of information about the deposit.

When participating in shared construction, the seller may not indicate in the contract the specific share of the future owner. In this case, it can be resold to other people.

If an agreement for the purchase and sale of an apartment with installment payment is concluded between the parties, pitfalls will be associated with the size of payments, installment periods and additional commissions.

For example, initially the parties entered into an agreement on an interest-free installment plan, but after the paperwork was completed, it turned out that the new owner of the property must pay a fee for using the installment plan. The buyer will be able to challenge additional payments only in court.

Features of working with alternative contracts for the transfer of property rights

Sometimes the transfer of ownership of housing occurs under contracts of gift or inheritance, which is considered an alternative. A sample gift agreement can be found here. They have their pitfalls.

The purchase of an apartment under such agreements can be challenged in court.

This may happen if it is proven that the former owner acted under duress or did not understand the consequences of the transaction.

The most dangerous is the purchase of an apartment under a gift agreement. The pitfalls of such a contract are the lack of an exact transaction amount and recording the fact of transfer of money . If the court terminates such an agreement, a bona fide buyer will not be able to return the funds invested in the property. After all, the contract will not indicate the amount of the transaction.

No less dangerous is buying a donated apartment. Pitfalls here are also associated with the gift transaction. If it is disputed, the property will revert to the original owner without compensation to the buyer.

What to pay attention to when working with a realtor?

An agreement with a realtor for the purchase of an apartment has its own characteristics. The pitfalls in this case are related to the deadlines for fulfilling obligations, the number of objects offered, and commissions.

When concluding such an agreement, it is necessary to separately stipulate responsibility for providing the buyer with false information.

Watch useful video

Risks when buying property abroad

Real estate transactions abroad have their pitfalls. Buying an apartment in Bulgaria may be associated with the following difficulties:

• differences in the rules for calculating living space;
• problems with heating in houses;
• high prices for utilities.

It should also be remembered that in Bulgaria and other EU countries, the period of permanent stay of foreigners in the state is limited to 90 days.

What difficulties may arise with real estate in resort towns?

Buying an apartment in Sochi is not always successful. The pitfalls of such a deal are problems with electricity in some areas of the city, low quality of cheap housing, and flooding of houses in areas near the sea . Because of these problems, every object in the city needs to be viewed independently.

It should also be remembered that some objects in Sochi, as in other resort cities, are self-built. After the sale, the new owner will have to legalize them himself.

What should sellers check during a sales transaction?

Is it safe for the owner to sell an apartment in 2023? Pitfalls for the seller in such transactions are associated with incorrect appraisal of the home and non-fulfillment of payment obligations by buyers.

Problems when selling real estate also arise when coordinating the transaction with other home owners, as well as persons who have the right to first purchase it. The homeowner will not be able to sell the property without their consent.

Selling an apartment to mortgage holders has its own peculiarities. The pitfalls here are:

• restrictions on real estate prices. The bank will not approve a transaction at an inflated price;
• the need to submit a full package of documents for the transaction, which can be waived during the normal purchase and sale procedure.

There are pitfalls when selling an apartment using maternity capital. This deal must be agreed upon with the guardianship, otherwise it will be challenged in court . It can be carried out only after receiving consent from the Pension Fund.

Separately, it is worth considering the contract with a real estate agency for the sale of an apartment. The pitfalls of such an agreement are the cost and scope of services provided . When drawing it up, it is also necessary to specify the obligations of the realtor.

What to pay attention to when making payments through a safe deposit box?

Most transactions involve payment through a safe deposit box when purchasing an apartment. The pitfalls in this procedure are related to the storage period of funds and the procedure for accessing them .

Also, when using a safe deposit box, the parties to the transaction need to enter into an additional agreement with the bank on sharing property risks.

This agreement will allow you to receive compensation in the event of theft of funds.

What are the risks when buying a share in an apartment?

G. Alekseev Author of the article

Table of contents:

Collective ownership of residential real estate is a common practice in Russia. For brevity and simplicity, the conclusion of purchase and sale transactions in this case is called the purchase of shares in an apartment. It will be useful for the future owner, even if he is not a realtor or a lawyer, to know what risks arise when purchasing a share in an apartment and how they can be avoided.

Legal basis for the purchase and sale of shares in an apartment

The Civil Code has Article 250, which establishes a certain procedure for selling an apartment. In particular, the text of the article gives the seller’s neighbors a preemptive right to buy out the share. Simply put, the seller of a share in an apartment is obliged to first offer a deal to his neighbors and only then, if they refuse, can he make an offer to other potential buyers.

You need to make an offer not “in passing,” but purposefully, indicating the transaction price and other conditions. The owner of a share in the apartment is obliged to notify all neighbors that he is going to sell his rights to the property and obtain a written refusal from everyone in order to complete the transaction legally.

This provision in the law was developed in order to get away from communal property as soon as possible. In practice, this measure has had some success, but the communal apartments still exist.

If the addressee remains silent for a month, it may be recognized by government agencies as a refusal.

But sometimes neighbors can, owning their shares, live somewhere very far away. And sometimes the seller simply wants to complete the transaction as quickly as possible, and then he may resort to circumventing the law. This creates risks that future owners of a share of rights are exposed to.

What risks might there be when making a transaction?

Among the “toolkit” of unscrupulous sellers and realtors, there are several measures aimed at circumventing the law:

1. The seller shows his neighbors a sample contract with an unreasonably inflated price, which scares them away and forces them to abandon the deal. Then, showing the contract to the prospective buyer, the seller promises to take an amount less than that stated in the contract. This does not create additional costs if the seller has owned his share for more than three years. But all the “agreements in words” mean nothing, and at the last moment the seller can demand the amount specified in the contract, and in case of refusal, he has the legal right not to return the advance. Therefore, you should not rely on verbal promises.
2. A purchase and sale transaction may be “disguised” as a gift. For the buyer, this creates not only an additional financial burden in the form of income tax (13% of the cost), but also an additional risk: giving a gift to a stranger may arouse unnecessary suspicion among neighbors and prompt them to conduct an investigation. A special case is possible: the seller “donates” a small part of the share in order to equalize the rights of the buyer with its neighbors. However, this is also a latent bypass of the law, and you can get into the thick of disagreements between owners.
3. The seller can “disguise” the purchase and sale transaction as a loan. The collateral in this case is the right to a share in the apartment. After concluding a fictitious transaction, the seller “does not repay the debt” and the share goes to the buyer. There are two risks here. Firstly, authorized bodies often refuse to register such transactions. Secondly, even if the deal goes through and the neighbors find out about it, they can pay the amount instead of the buyer, thus leaving him with nothing. In such cases, the court usually recognizes the property rights of the neighbors. So it’s also better not to agree to such deals, so as not to lose money. Similarly, the seller can resort to a fictitious annuity agreement - with the same risks for the buyer.

All fictitious transactions, according to Article 170 of the Civil Code, can be investigated by the court and, if the sham is proven, will be interpreted as the sale of a share in the apartment.

Be sure to request from the seller documents that confirm that he solely owns his share in the apartment, does not violate the rights of minors, does not try to sell his wife’s property after a divorce, and does not make a fraudulent real estate transaction to which he has no rights.

What other risks could there be?

All additional risks when purchasing a share in an apartment are non-legal. To avoid them, it is necessary, if possible, to find out why the former owner decided to sell his share. It is better not to waste time and effort on this, so as not to end up in an unpleasant situation later.

• If the seller is evicted because of scandalous neighbors, then you can take his place and get all his problems. It's better to find out about your neighbors in advance.
• They often sell shares in unsafe or poorly equipped apartments, during interruptions in water, electricity, or gas. You should pay special attention to situations when the seller himself begins to reduce his own price.
• Excessive haste in a matter such as selling a share in an apartment may mean that the owner has urgent business, or may mean that he is in trouble with the law. Ask for a couple of days to think it over and see how the future seller reacts.

Despite the many “pitfalls” in owning a share of an apartment, you can count on the transaction being profitable and the absence of problems if you show a little care and keep track of all the listed nuances, and at the same time make sure from your neighbors that they have given a written refusal to own the share you are going to buy You.