Most happy owners of a certificate of maternity capital use it to improve housing conditions. Since the amount allocated by the state is not enough to purchase a finished property, there is a need to apply for a housing loan or mortgage. This procedure has some features and nuances.
Therefore, it is worthwhile to figure out how the mortgage for maternity capital will look, and on what conditions it can be issued.
Key Features
In 2015, more than 3 million Russian families have already received certificates for the birth of their second child. And about 2 million of them directed funds for the purchase of apartments or the construction of houses, because this problem is most relevant in our time. Despite the fact that you can dispose of the right to provide financial assistance after 3 years from the moment the second child appears in the family, if we are talking about improving housing conditions, this rule does not apply. In a word, it is possible to channel maternity capital funds to purchase housing without waiting for the baby’s three-year anniversary. But you also need to consider that every member of the family, both children and parents, must have housing in shared ownership. That is, the second child must also have its own share in the apartment or house, but which one is not specified in the law.
So, a mortgage for maternity capital, the conditions of which will be discussed below, is a reality. You do not have to wait three years, as many people mistakenly believe, but you should register the property as a property for all family members, including children.
Mortgage down payment
You can use maternity capital as a down payment on a mortgage, which is quite profitable for those who buy housing after the birth of their second child and are not able to contribute a certain amount at a time. And banks will refuse to provide a loan to purchase real estate if the family does not have start-up capital.
So, you can direct maternity capital as an initial contribution on a mortgage, for this you need to choose a bank and draw up a mortgage loan agreement with it. Then, housing is selected and a transaction is made with a financial institution. After this, the loan agreement with the bank and the certificate of ownership along with the certificate should be referred to the Pension Fund.
Within two months after submitting the application, the specified amount is transferred to the bank account where the mortgage was issued to pay off the down payment. Money is not issued to certificate holders under any circumstances.
Repayment of principal or interest on a mortgage
A mortgage under maternity capital also means paying for an existing housing loan, even if it was issued long before the birth of the second child. That is, by means of state support it is possible to repay a housing loan and thus reduce the loan terms and the size of the monthly payment. But keep in mind that it is impossible to pay fines and late fees for late mortgage payments due to maternity capital.
How to apply for a loan
Further, we will talk about how to take a mortgage under the maternity capital. For starters, of course, you need to issue a certificate at the Pension Fund. This can be done immediately after the birth of the second child and the paperwork for him. The application is considered within a month, after which the parents receive a certificate.
Next, you should apply for a loan at the bank, for this you need to choose one that provides more favorable conditions, then provide a number of documents:
- Passport.
- Income statement.
- Certificate for the right to receive maternity capital.
- A statement of the balance in the maternity capital account.
Only after this is the property purchased, that is, a deal is being made with it. After that, the package of documents should be taken to the department of the Pension Fund. Namely, a certificate, an agreement with a bank, a certificate of ownership. After reviewing the documents within 2 months, the money is transferred to the bank account. And here it is not necessary to immediately draw up housing for all family members, it is enough within 6 months to draw up a notary obligation to transfer immovable property to shared ownership.
Terms of an agreement
A mortgage agreement taken with the involvement of maternal family capital does not differ much from the standard one. That is, the bank still puts forward stringent requirements for the borrower. You also need to confirm the income, your solvency and take out insurance. Although some banks reduce the interest rate on mortgages using parent capital, its size can reach 14% per annum. As in all other cases, the amount of interest depends on the down payment, therefore it is more advisable to invest a certificate for these purposes.
In addition, it is possible to improve housing conditions in the literal sense of the word. That is, to sell an existing facility and buy a larger one with surcharge. And here you can also draw up a mortgage agreement with the bank. There is no doubt that you will have to pay interest on the loan until the funds are transferred to the bank from the Pension Fund, but you should not wait three years from the moment the baby is born.
What to look for?
A mortgage for maternity capital has several of its own characteristics, which you need to pay attention to:
- If the housing or part of it is purchased with maternity capital without additional financing from the bank, but under a loan agreement, then, until the funds arrive at the lender's account, the borrower pays interest on the use of the funds.
- If the amount of the down payment, and it is usually 10% of the appraised value of housing, exceeds the cost of maternity capital, then the borrower must pay the difference on his own.
- If the funds of maternity capital were previously used, for example, to educate a child, then the balance of the amount cannot be used as an initial contribution for the purchase of housing under the mortgage program (only for repayment of debt or interest on it).
- A mortgage loan can be repaid with maternity capital funds, even if, for example, a father took a loan before marriage, but only if he renews the living space for all family members.
In general, there are several options on how to get a mortgage under maternity capital. But you also need to choose the right financial institution that has special lending programs.
Banks that provide maternity mortgages
According to statistics, many clients have entrusted such a financial institution as Sberbank, maternity capital. A mortgage, by the way, can be issued in several programs, which significantly increases the chances of approving a loan and makes its terms more favorable. The interest rate depends on many circumstances, for example, on the size of the down payment and the loan term, as well as on whether the client participates in the Sberbank salary project. The maximum interest on a mortgage will be 14% per year.
Among other banks in our country, VTB 24, Bank of Moscow, Unicredit, DeltaCredit work with certificates. Rates and terms of lending can be found in the financial institution. It is also worth comparing the conditions under which a mortgage is issued for maternity capital.The calculator, presented on the official websites of banks, will help to visually assess the benefits of the client.
Conclusion
So, first of all, you need to issue a certificate in the Pension Fund. Further, carefully consider all the options, because a mortgage for maternity capital is a unique chance that you need to be able to use correctly. Perhaps it is more profitable to buy an apartment in a new building, there are special programs for this, or invest in a mortgage for the purpose of building a residential building. There may be quite a few options.
