Decree of the President

Decree of the President of Russian Federation on June 10, 1994 N 1180 

In order to assist citizens in the construction (reconstruction) and acquisition of housing, I reslive:

1. To establish that:
   citizens of the Russian Federation recognized in the prescribed manner to be in need of improvement of housing conditions, receive grants for construction or purchase of housing in accordance with a decree of the Council of Ministers - the Government of the Russian Federation dated December 10, 1993 N 1278 "On approval Provisions for the citizens of the Russian Federation in need of improvement of housing conditions, grants for construction or purchase of housing ";
   legal entities and citizens of the Russian Federation have borrowed funds for construction (reconstruction) and the acquisition of housing and resettlement of land for housing Construction on a commercial basis.
2. To approve the attached Regulations on housing loans.
   Set that the provisions on housing loans extended to loans obtained for the construction and purchase of real property and dacha garden plots.
3. The organs of executive power entities of the Russian Federation to enhance the provision or sale of Russian Federation citizens and legal entities - the land to developers for housing.
4. The Government of the Russian Federation in 3 - one month to amend the State Duma Federal Assembly a bill to change the taxation of profits of banks from providing loans for the construction of (reconstruction) and the acquisition of housing and resettlement of land for housing.
5. Encourage businesses and organizations of various forms of ownership in order to assist their employees in improving housing conditions to provide guarantees to banks to repay loans received by enterprises for the construction of (reconstruction) and the acquisition of housing and resettlement of land for housing, as well as partially or fully repay them from their own funds.
6. This Decree shall enter into force upon signature.

The situation
on housing loans
(utv. Decree of the President of Russian Federation on June 10, 1994 N 1180)

1. These Regulations are prepared in accordance with the Law of the Russian Federation "On the Fundamentals of federal housing policy" and the Decree of the President of the Russian Federation dated December 24, 1993 N 2281 on the development and introduction of extra-budgetary forms of housing investment ".
2. The main purpose of this Regulation is to define the modalities for the overall monetary support to the population in solving the housing problem by using its own funds nationals, as well as grants received for the construction or purchase of housing on the basis of the Council of Ministers - the Government of the Russian Federation dated December 10, 1993 N 1278 "On approval of provisions for the citizens of the Russian Federation in need of improvement of housing conditions, grants for construction or purchase of housing".
3. The situation determines the order of banks in the Russian Federation legal and natural persons loans for the construction of (reconstruction) of housing, land improvement, as well as housing provided mortgage real estate (mortgage).
4. When construction lending (reconstruction) or purchase housing bank can be given three types of housing loans:
   a) short-term or long-term loan, provided legal and natural persons for the acquisition and rehabilitation of land for the upcoming housing (land loan);
   b. ) Short-term loan for the construction of (reconstruction) of housing, provided legal and natural persons to finance the construction works (construction loan);
   c) the long-term loan granted to individuals and legal entities to purchase housing (loan for the purchase of housing).
5. Legal persons covered by the present situation, are:
   investor-developer (an organization making investments in housing);
   general contractor (performing the entire range of construction and installation works turnkey);
   contracting organization Participating in the construction cycle;
   other legal persons who acquire real estate in the housing sector.
6. Lending to housing are subject to disqualification developer in the prescribed manner of land and a permit relevant bodies for housing construction.
7. Credit for the construction of (reconstruction) of housing is provided within the envisaged projects and award contracts for the implementation of construction and erection of the timing and cost of construction (reconstruction).
8. Housing credit shall be subject to the basic principles of credit: the use of trust, security, urgency, payment, repayment.
   Proof targeted use of credit is to provide the borrower received the documents on the use of loans for housing construction or acquisition or the acquisition and rehabilitation of land for the upcoming housing .
   Loan security is a real estate mortgage borrower (including built or acquired through loan), property rights in immovable property, other assets and property rights, which, in accordance with Russian law could be used as collateral.
   Proof repayment is to provide the borrower documents about its solvency.
9. The issuance of construction loan effected by the opening line of credit, while loans issued by the borrower parts corresponding to the value of the completed stages of construction and installation works.
   Bank financing is entitled to exercise staged by advances funds in accordance with the timetable for construction.
   In the process Bank is financing the construction phases of inspection, monitoring the expenditure of trust funds, subject to cost and schedule for construction.
10. The amount of credit issued by the bank should not normally exceed 70 per cent of the cost of land acquisition and resettlement, construction (reconstruction) or the cost of purchased housing in fixed mortgage, provided the remaining funds investing borrower (own or received in grants from the budgets or from enterprises) in the amount not less than 30 per cent of the cost credited object.
11. The main document defining the relationship bank and the borrower in granting loans are credit agreement and a treaty on mortgage (on mortgage).
12. In the loan agreement are defined: the purpose of obtaining loans, loan terms and size, order the issuance and repayment of the loan, a tool lending (interest rate, terms and the frequency of its changes), the borrower's credit obligations, loan insurance conditions, method and form of security checks and targeted use loan, penalties for diversion and untimely refund loans, size and procedure for payment of fines, the order terminating the contract, other conditions under the agreement lender and the borrower.
13. Specific terms of housing lending bank established in agreement with the borrower. As a tool for possible use variable lending interest rate, index of principal debt, deferring payments the borrower.
14. Depending on the type of credit in the contract on mortgage (on mortgage) is defined shape, size and order collateral loan.
    The subject of mortgage may be:
    a) plot of land for construction, which is the borrower's property, or other proprietary right to the site;
    b) finished or unfinished housing construction;
    in) other types of property and property rights.
15. As a guarantee (bail) repayment of housing loans granted by banks may be used: for legal entities - the bank guarantees, which opened the current account of the borrower, as well as other banks, insurance companies and other entities; for individuals - sponsorship of one or more citizens, Insurance companies and other entities.
16. Mortgaged property is subject to insurance mortgagor risk of loss and damage.
17. The decision on granting the construction loan was adopted creditor banks on the basis of the borrower's credit application.
    In addition to applications for loans, which specifies the purpose and duration of use of credit, as well as its form of security in the application include:
    for legal persons - borrowers - foundation and registration documents; balance sheet of the company; schedule of revenue and mandatory payments; documents proving the existence of ensuring loans; feasibility study on the use of credit and calculating the expected return on credit costs; documents confirming the right to station construction, and building permits ; Design Estimates approved in the prescribed manner; copies of contracts for the implementation of contracting construction works; other documents at the request of the creditor;
    for individuals - documents confirming the right to station buildings, building permits; agreed in the prescribed manner project Estimates; documents needed to determine the creditworthiness of the borrower; other documents at the request of the bank.
18. At the stage of the application the lender conducts a comprehensive analysis of the creditworthiness of the borrower, its financial sustainability, assesses the construction budget (funding sources and intent on using built housing - sale, lease), the needs of the housing market in the location of buildings.
19. Until the full repayment of principal and interest on the loan the borrower has no right without the written consent of the bank to sell or transfer property rights to real estate third party.
20. Failing the return of the credit borrower is made attachment and sale of mortgaged property to cover bank losses in the manner and under conditions established by Russian law.
21. In identifying the misuse of loans obtained for the construction or purchase of housing, establishment of banks have the right to recover prematurely issued loans.