Mortgage prenuptial agreement: When buying a home with a mortgage, both spouses or one person can act as a borrower, but most often the loan is repaid by joint efforts. So that in the event of a divorce there are no disputes over the ownership of real estate, it is reasonable to conclude a prenuptial agreement. Such a document contains information about who will continue to pay and who will become the owner.
What is a prenuptial agreement
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A marriage contract is an official document certified by a notary and regulating financial and property issues between the parties. At the time of the conclusion of the agreement, both spouses must be fully capable.
The document should reflect the following items: the obligations of the spouses to repay the loan, material obligations to invest in the repair or reconstruction of housing, the shares of both parties upon termination of the union. And one more obligatory aspect is the responsibility of everyone in case of failure to fulfill the prescribed obligations.
There are many reasons for signing an agreement. The most common:
- One of the spouses is against buying a home;
- One of the spouses has a bad credit history;
- Money for a down payment is given by parents;
- The spouses agreed that after the divorce, the housing will become the property of a third party;
- The loan was taken before marriage;
- The parties are in an uneven financial situation.
You can conclude an agreement for a certain period, and if necessary, extend it or draw it up again by adding additional clauses.
When can a mortgage prenuptial agreement be drawn up?
In some cases, a person acquires an apartment in a mortgage even before marriage. After joining the union, the second spouse joins the repayment of payments, but the borrower remains the owner of the property. By concluding an agreement in such a situation, two tasks can be solved: to establish the procedure for payments and to distribute the shares of the property of each spouse during a divorce.
The conclusion of an agreement during marriage helps to equalize the rights of spouses in relation to common property in the event of a possible divorce. It is advisable to indicate in the document who will repay the loan and own real estate in the future. Ownership of a mortgaged apartment can be left to the main borrower and indicate what part of the property the second spouse will receive. Or immediately distribute the shares and prescribe it in the agreement.
The possibility of a conclusion after the official break in relations is not provided. The Family Code prescribes to take care of this, being married or at the stage of its conclusion. In the absence of a formal agreement or agreement between the spouses, the division of property occurs through the courts. You will have to wait until the decision to terminate the marriage after 1 month comes into force, and submit a separate application for the division of common assets. The document in many cases helps to avoid litigation.
How does a mortgage prenuptial agreement work?
Such an agreement implies that only one of the spouses should own the apartment purchased with the loan. He is also required to make monthly payments on the loan. The second spouse as a result of the agreement does not have the right to claim a share in the property after the divorce.
It is up to the spouses to decide whether to enter into such an agreement. You should not be guided by the persistent demands of employees of Sberbank or another financial organization that benefits from having only one payer. Each of the couple can choose for himself whether to give up housing upon termination of the union or not.
- borrower details;
- information about who will receive housing after a divorce;
- information about who makes the initial contribution and current payments;
- clause on liability for violation of the agreement;
- grounds for reconsideration.
If, in case of disagreement to sign the agreement, the bank refuses to provide a loan for the purchase of an apartment, the spouses have the right to demand compensation for the disruption of the real estate transaction.
What you need to draw up a contract on separate property
To draw up a document, you need to come to the notary’s office with a passport, marriage certificate, papers on the right of ownership and a completed form. You will also need information about the creditor bank, the purchased apartment, the timing and amount of debt.
Before the visit, you need to think over in advance a sample of a future agreement down to each point. It is important to decide who will own the assets and pay the debt. When applying for a mortgage, Sberbank often offers its own sample contract on separate property, which already contains the main provisions. However, it is not necessary to agree to its use.
Legal assistance in the execution of the contract
The formation of an agreement is a responsible event that requires careful analysis. The duties of the specialist who certifies the document does not include helping spouses prepare the content, so most often he advises using ready-made standard templates.
Banks also act in their own interests, offering to sign a document on their terms. Having agreed, the spouses then find in the papers information about increased interest rates and other unforeseen expenses.
In order to avoid risks to the maximum, it is better to contact a qualified lawyer. He will study all the circumstances and offer the best solution.
Pros and cons of a mortgage prenuptial agreement
Such documents have more advantages than disadvantages. There is only one significant drawback of the agreement – the need to change the content in the event of amendments to the legislation. Someone classifies the very procedure for concluding a marriage contract with a spouse as a minus, but this item cannot be classified as objective.
- distribution of financial obligations to repay the mortgage debt to the bank;
- early determination of housing rights in the event of a divorce;
- protection from conflicts and lengthy litigation.
Experts recommend always making an agreement. Relations between spouses can change, so you need to take care in advance to prevent possible financial disputes. Moreover, conflicts are reflected in other family members.
Marriage contract and maternity capital
Only the owner of the certificate has the right to purchase real estate in a mortgage using maternity capital. However, housing must be registered for all family members, including minor children. The contract must indicate to whom and in what shares the apartment belongs.
The agreement can include a clause on donating housing to a child, if he is alone. In large families, each of the children should have shares. This should be taken into account when preparing the content of the document.
Termination of the marriage contract in the presence of a valid mortgage
Citizens have the right to conclude and terminate agreements at any time. This provision is spelled out in article 4421 of the Civil Code. However, if the conditions for obtaining a housing loan stipulate the existence of a contract between the spouses, it is not recommended to refuse it. Otherwise, the bank has the right to refuse agreements with the borrower and put forward a demand for the full repayment of the mortgage.
A mortgage prenuptial agreement is 100% justified, even if initially the idea of its creation seemed meaningless. It saves spouses from many problems that may arise in the process of resolving any financial disputes. Reviews of those who issued the document confirm this fact.