One of the ways to ensure proper fulfillment of obligations is pledge. It arises in accordance with the contract and on the basis of the law. In case of violation of the obligations accepted by the debtor, the creditor may file a claim for foreclosure on the mortgaged property. However, this option is considered a last resort. It is used when extrajudicial collection of mortgaged property has not yielded results. 
Contract
If the debtor does not fulfill its obligations, the pledge holder has the right to satisfy his claims from the value of the pledged property. Corresponding legal relations arise at the conclusion of the contract. Under the terms of the agreement, the subject of the pledge remains with the creditor or is transferred to him. The subjects are the owner of the object and the lender. The last can be any person. A pledge agreement must be concluded in writing. Otherwise, it will be considered invalid. If the object is real estate, then the agreement is certified by a notary. A mortgage agreement is also considered collateral. In accordance with Art. 339 GK agreement of this type is subject to state registration.
Transaction subject
According to Art. 336 GK as it can be any property. If the subject of the transaction is any thing, then it must be individually defined. If this is a right, then it must be described in detail. Property is not subject to pledge:
- Limited in circulation or withdrawn from it.
- To which the penalty under Art. 446 Code of Civil Procedure can not handle.
Rights that are not subject to assignment are not subject to pledge, as well as claims directly related to the identity of the creditor. The latter, in particular, include compensation for harm, alimony debts, etc. 
Additional terms of the contract
The agreement must indicate the value of the collateral. It is determined by the parties to the transaction. The contractual conditions describe the essence of the obligation, which is provided by the property. In particular, the agreement establishes that the object remains with the debtor, and he continues to dispose of it and use it. However, the powers of the owner are limited in the interests of the creditor.
Compliance with breach of contract
It is carried out in two stages:
- Collection of mortgaged property.
- Realization of material values.
The lender will be able to recover the mortgaged object in case of non-fulfillment or improper fulfillment of contractual conditions. In essence, this procedure acts as a withdrawal of a part or the full value of an item to pay off a debt. The implementation of the pledged material assets is carried out by sale at public auction. 
Executive production
In Art. 78 Federal Law No. 299, the procedure for foreclosing on mortgaged property is described in detail. It is carried out in accordance with:
- Writ of execution.
- Judicial act.
- Executive notary record.
Collection of mortgaged property may be carried out to satisfy the requirements of:
- The lender himself.
- A claimant who does not act as a pledge holder.
In the latter case, the value of the object is taken as the basis.For the implementation of the procedure, a decision is required on foreclosure on the mortgaged property issued by the first instance (second or supervisory in the event of an appeal). 
Peace settlement
The legislation provides for an out-of-court procedure for foreclosing on pledged property. Such a procedure is allowed on the basis of a contract of a debtor with a creditor. This agreement must meet the following requirements:
- The contract is concluded after obligations have been violated.
- The agreement is certified by a notary.
- The agreement was signed with the participation of previous creditors.
- To establish a mortgage, the consent of other persons or authorities is not required.
- The subject of the agreement is not agricultural land, an object of artistic value, property complex.
- The agreement does not establish the acquisition by the lender of a land allotment in a mortgage.
- The agreement does not violate the interests of the parties about the upcoming pledges.
All these requirements must be met at the same time. 
Bailiff
In accordance with the judicial act, the FSSP employee seizes property from the mortgagor, and seizes him. In this case, the employee draws up the decision and sends it to the appropriate authority. If necessary, measures are taken to ensure the protection of the immovable property. The bailiff should transfer the documents and property to the creditor for subsequent sale. The sale can also be carried out by the FSSP service - at the relevant request.
Activities of a financial institution
Foreclosure of mortgaged property by a bank is carried out according to the following scheme:
- The debtor is notified of the amount of debt, a reasonable time is set for repayment on a voluntary basis.
- A financial organization sends a letter to the subject stating that foreclosure on pledged property has begun.
- The debtor is obliged to transfer the mortgage subject to the acceptance certificate.
- The financial company informs the subject of the time and place of the public auction, which will be implemented material values.
Sale Features
If the first auction has not taken place, the bank has the right to redeem property in a ten-day period and set off its claims in the amount of the acquisition. If the financial institution did not take this opportunity, a month later repeated tenders are held. If they did not take place, the bank can acquire property within a month at a cost 25% less than the price at the first auction. If the financial company does not do this, the procedure is terminated and the mortgage is withdrawn. 
General implementation rules
They are established by Art. 350 GK. By judicial decision, the sale is held at public auction. The course of the procedure is set in the Code of Civil Procedure. At the request of the debtor, the term for foreclosure on pledged property may be postponed for no more than a year. At the same time, the postponement cannot infringe on the rights and interests of the parties to the legal relationship. The postponement of tenders does not exempt the debtor from compensation of the penalty and compensation of losses to creditors for the entire period of delay
Collection of mortgaged property: judicial practice
The value of the object at the first auction is established by the authorized authority for the consideration of the dispute. If it is not sold for the first time, prices are subsequently determined by the parties. Bidding is held on the basis of an auction. The objects for sale go to the highest bidder. If the amount received during the sale from the auction is small to cover the debt, the missing funds are withdrawn from other material assets of the debtor. At the same time, the lender cannot use the pre-emptive right based on a mortgage. If the amount exceeds the principal, the difference is returned to the debtor. If the bidding did not take place, the parties may sign a contract of sale.The purchase value includes requirements in respect of which a foreclosure was made on the mortgaged property. Judicial practice recognizes the auction as failed if:
- There were less than two buyers.
- No allowance for the initial cost of objects.
- The entity that won the tender did not deposit the purchase price in a timely manner.
If repeated tenders have not taken place, the mortgagee may reserve the property (acquire it), but its price will be 10% less than the initial one. If the subject has not used this right for a month, the contract (dispute) ceases to exist. The debtor has the right at any time to terminate the foreclosure on the mortgaged property, having fulfilled the obligation. Agreements that in any way limit this opportunity are null and void. 
The practice of foreclosure on a mortgaged building / premises
The subject of a mortgage may be the object specified in paragraph 1 of Article 130 of the Civil Code:
- Land.
- Buildings / constructions for carrying out entrepreneurial activity.
- Enterprises.
- Garden houses.
- Apartments, rooms, houses.
- Garages.
- Aircraft, watercraft.
- Space objects.
To satisfy the requirements, the creditor should file an application for foreclosure on the mortgaged property. The document is sent to the authority authorized to consider civil disputes. The legislation establishes questions that the court must answer in the course of the proceedings. The satisfaction of the creditor's requirements may be refused if it is recognized that the violations committed by the debtor are minor. With a positive decision, the court in its act indicates:
- Amount payable.
- Implementation Method.
- Mortgage subject.
- Initial cost.
- Security measures for the facility.
The sale of property is carried out, as in previous cases, from tenders. Sale through auction is allowed. Organization and holding of tenders is assigned to the FSSP employees. The parties must be notified of the time and place of their holding no later than 2 months. before the estimated date. The notice is published in the official periodical.
