When can you use mat capital after birth? When can maternity capital be used? Nuances and limitations
How to use mat capital to purchase housing and other needs? What is the period and procedure for using maternity capital funds? Is it possible to use family capital without waiting 3 years?
Hello, dear readers of the HeatherBeaver online magazine. Welcome to the site's regular expert, Eduard Stembolsky.
We continue our series of publications about maternity capital. The topic of this article is the competent, efficient and profitable use of funds secured by a state certificate for family capital.
Let's start, friends!
1. General procedure for using maternity capital - terms, conditions, rules and documents
The state incentive program for families with two or more children has been in effect since 2007. Initially, the amount of maternity capital (MC) was 250 thousand rubles, currently its size (thanks to annual indexation) is 453 thousand.
The main goal of the program is to increase the birth rate in the country and stimulate natural population growth. You can receive a certificate for family capital immediately after the birth (adoption) of a second (or subsequent) child, but you can use the funds (with the exception of certain situations) only after the baby’s third birthday.
The amount is not given to parents or children after they come of age: it is not cash, but a kind of financial asset that can only be used for specific needs. The list of such needs is limited by law.
A few important facts regarding the use of MK:
- one family can receive benefits only once (with the exception of regional programs, according to which you can receive capital again after the birth of the fourth or fifth child);
- You can apply to the Pension Fund of Russia (PFR) at any time after the birth of your 2nd (or subsequent) child;
- a change in the amount of capital due to indexation is not a reason to replace an already received certificate;
- The benefit is given to the management of the parents, not the child.
Certificates are issued by the Pension Fund. This structure also deals with all decisions regarding the intended use of funds. More precisely, the Pension Fund gives consent or refusal to proposals from families to use public funds.
Families who have a second baby can contact the regional office of the Foundation at their place of stay or residence immediately after this event.
There are 3 options for submitting an application:
- Personally.
- Through a trusted person.
- By mail (including email).
Women who gave birth or adopted children after January 1, 2007, men who are adoptive parents or sole parents have the right to own a certificate.
To obtain a certificate you need the following documents:
- a written application;
- applicant's passport;
- birth certificates of all children in the family;
- court order on adoption.
The application is reviewed by the Fund within a month (during this time, employees carry out a standard legal check), after which a decision is made to grant the right to benefits. If the applicant cannot come to receive the document in person, it will be sent to him by mail.
Please note some nuances: capital is issued only for children born (adopted) after 01/01/2007. However, in the “children” column you must indicate all children, including those born before this date.
Example
The mother gave birth to 3 children - in 2004, 2007 and 2015. When applying for a certificate in 2017, she needs to indicate that the benefit should be issued in connection with the birth of a second child. However, the application must include all children, including the youngest.
In this case, the family will be able to use the funds immediately after the certificate is issued, since 3 years have passed since the birth of the second baby.
The certificate itself is a bearer security: it is not valid without a document confirming your identity. The form has several degrees of protection, but the paper itself has no value without confirmation of information in the unified state register.
What I mean is that falsifying a document is pointless - only those who have the legal right to do so can gain access to funds secured by a certificate. Nevertheless, maternity capital scams do occur: I will talk about them in a separate section of our article.
Important news on the topic:
President Putin proposed extending the maternity program until 2022. Additionally, he proposed introducing a number of changes to its implementation.
Now families who need it will be able to receive maternity capital funds within the first 1.5 years after the birth of a child - in the form of monthly payments of about 10,000 rubles.
In addition, families can use maternity capital to care for a child during the preschool period, paying for the services of private kindergartens and nurseries.
News video on this topic:
2. Is it possible to use mat capital for up to 3 years?
Current legislation states that it is possible to obtain the right to use funds secured by a certificate only after the child reaches three years of age.
At first there were no exceptions to this rule, but practice has shown that for many families it is not practical to wait three years, since money is often needed right now, and not in the near future.
This is especially true for families who do not have their own home or live in a cramped apartment with two or more children. State support is especially important in the first years of the life of the second or next child, and not after three years.
For this reason, the state accommodated young families and allowed in some situations the use of maternity capital for up to 3 years.
Early use of money is possible in the following cases:
- if you need to repay an existing housing loan;
- if you need to make a down payment on your mortgage;
- if you need to pay off a loan received for housing construction or reconstruction.
You can repay both the principal amount of the loan and interest with your mother’s money. But penalties and fines for late payments are prohibited from being paid with state assets.
In all cases, the decision to transfer finances to bank accounts is made by the Pension Fund. Sometimes employees of this institution refuse to use capital early - for example, if they suspect certificate holders of misappropriation of funds.
3. How to use maternity capital in 2018 – TOP 5 popular ways
When deciding to use family money, parents should carefully consider the pros and cons, since they will not be able to receive government subsidies a second time.
Families who have a difficult housing situation - nowhere to live, overcrowding, inappropriate living conditions - do not have to think much about it. Money needs to be spent on purchasing real estate or building (reconstructing) a house.
If there are no problems with living space, you should think about the education of your children: investing in a child’s development is the most profitable and promising type of investment.
Let us consider in more detail all types of treatment of family capital.
Method 1. Buying an apartment (house)
If the family already has its own savings, but they are not enough to buy an apartment, you can supplement the required amount from maternity capital funds.
According to statistics, purchasing real estate is the most popular and relevant option for using public funds. Matkapital is used both for a one-time purchase of an apartment and for purchasing housing with the help of a loan.
Not all housing can be purchased with government assets.
Requirements for real estate objects are strictly regulated:
- apartments and houses purchased with maternal capital funds must be located in Russia;
- housing should not be dilapidated and unsafe;
- the property must have the status of a full-fledged residential property.
The transfer of money to the seller’s account occurs only after a positive response from the Pension Fund of Russia on the expenditure of funds and the execution of a purchase and sale act in Rosreestr (Federal State Registration Service).
To protect the interests of children, Pension Fund employees are required to personally inspect purchased housing for compliance with the requirements established by law. If they feel that the house or apartment is unsuitable for children to live in, they may refuse to finance the transaction.
Please note a few important facts:
- When purchasing housing, registration is made for all family members(usually dad, mom, 2 children).
- It is not necessary to use the entire amount of capital– part of the funds can be left for other purposes.
- The decision to transfer funds is made by the Fund within 2 months– be sure to calculate the time frame for purchasing a home in advance to avoid conflicts and misunderstandings with the seller.
- It is prohibited to purchase land plots using maternity capital.- You will have to buy land with your own funds.
In fact, the housing is purchased either in installments (if the seller agrees to wait for the funds to be transferred), or the buyer takes out a loan, transfers the money to the former owner of the apartment, and pays the debt to the bank from maternal capital.
All the details about purchasing private housing with state benefits are in the article “”.
Method 2. Improving living conditions - reconstruction and construction
Another way to improve your living conditions is to build a house yourself or with the help of contractors. Parental assets can also be used for these purposes.
Previously, it was possible to build houses with family money only with the involvement of professional construction organizations. However, practice has shown that it is more profitable for many families to build housing on their own, calculating the timing of the work and purchasing building materials on their own.
You can request money for construction from the Pension Fund in advance or reimburse the costs retroactively (if you want to build a house before your child reaches three years of age). In the latter case, it is important to keep all receipts and documentary evidence of your expenses.
Funds for the construction of a house are issued in 2 stages. First, 50% of the requested funds are transferred, and six months later the second half is credited to the account. An important condition is that within 6 months you must lay the foundation, build the walls and roof of the future house.
I have already described its use in detail in one of the previous articles.
Now about housing reconstruction. This term refers to an actual change in the technical characteristics of an apartment in order to increase their efficiency and functionality.
In other words, traditional home repairs - changing plumbing, laying parquet, installing plastic windows and suspended ceilings - cannot be paid for with public funds.
What about reconstruction?
- increasing the area or number of floors of housing;
- changing the technical characteristics of the room (for example, turning an attic into an attic);
- complete renovation of load-bearing structures - in particular, increasing the height of ceilings in the house.
All work to change the characteristics of a building is pre-approved by the relevant institutions.
Method 3. Loans, credits and mortgages under capital
With the help of matkapital, you can make a down payment on the loan and repay the main part of it. Before contacting the bank about loans under microfinance, you should obtain permission to use government subsidies from the Pension Fund of the Russian Federation.
Only when the Fund’s employees give the go-ahead should it be worth negotiating with financial institutions about issuing a loan. You will not be able to use the funds yourself, bypassing the Pension Fund.
The fund allows the use of money only for the purpose of improving housing conditions. Taking consumer loans secured by maternal capital is prohibited, although in some regions of the Russian Federation this practice occurs.
In large banks you can get a mortgage using capital. This money is used as a down payment or a way to reduce your monthly payments. To repay the mortgage, it is allowed to use funds up to 3 years of age.
Example
The Petrov family has a mortgage debt for 20 years. 10 years after the start of payments, they have a child. Immediately after receiving the certificate, parents have the right to redirect funds to repay the loan or reduce the interest rate on the mortgage.
For a positive decision on issuing loans secured by MK, borrowers must have a regular income, stable work and a clean credit history.
Method 4. Payment for education
Education means not only studying at a university, but also any other training and development programs. You can spend funds on education from 3 to 25 years, using government assistance as needed.
The most popular areas for using maternal capital:
- payment for kindergartens;
- payment for clubs, music and art schools;
- training in higher and secondary educational institutions;
- accommodation of students in a dormitory.
Public and private educational institutions work with MK. The main condition is that they must be located on the territory of the Russian Federation. Unfortunately, it will not be possible to pay for tuition at a European university with state support.
Method 5. Transfer of funds towards pension
Experts believe that directing funds to accumulate a mother’s pension is a profitable and far-sighted decision. Although only a few of the total number of certificate holders use this method, the prospects for this option are quite numerous.
Firstly, this money is invested in general pension savings, which means it is included in circulation and increases interest on income.
If you direct these finances to a non-state Pension Fund, you have a chance of a significant increase in funds, since such organizations not only store, but also invest this money in profitable financial instruments with low risks.
You also have the right to change your mind at any time and withdraw funds from the NPF along with the accumulated interest.
For clarity, I combined all the options for using MK in a comparison table
№ Methods of use Advantages Flaws 1 Buying a house New housing at a reduced price Not all developers work with maternity capital 2 Reconstruction and construction Opportunity to radically improve living conditions using public money Complex documentation of the procedure 3 Loans and credits You can make a down payment or repay existing loans Not all banks issue loans against mat capital 4 Payment for education Can be used at any time from 3 to 25 years Not all institutions work with family state assets 5 Pension contribution It is possible to increase the amount of capital in private non-state companies Risk of losing part of your funds due to inflation 4. Allocation of shares of children and husband when using mat capital - legal advice
Many certificate holders are concerned about an important question - how to allocate the shares of the husband and children when using maternal capital to purchase real estate.
When purchasing an apartment or house, including the husband and all children in the list of owners of the property is a mandatory condition.
Loan agreements for the purchase of housing are often drawn up by both parents - they are co-borrowers and home owners.
However, Pension Fund employees will not issue permission to use the funds without a written commitment from the parents to include all existing children (including adopted children) among the owners of the purchased apartment.
An agreement on the allocation of shares can be drawn up at a notary or independently. This must be done no later than six months after purchasing a home or purchasing it on credit.
If such a procedure has not been carried out, all subsequent transactions with housing will be considered illegal, as well as the very ownership of a house or apartment. The specific sizes of shares are not stipulated by law: the main thing is that all children are allocated their share of housing.
5. Fraud and scams with mat capital - how to avoid deception
Although MK is not “real” cash, there are plenty of hunters to profit from it. There are dozens of fraudulent schemes developed by swindlers in order to use maternity capital for their own purposes.
Main scam options:
- illegal withdrawal of capital;
- obtaining a certificate by people who are not entitled to it;
- real estate scams: acquisition of non-existent housing, fictitious sales contracts, sale of construction shares purchased with capital;
- scams of officials who have access to the disposal of assets.
The simplest scheme is direct deception of certificate holders. Criminals promise to “help with cashing out” funds for a certain percentage, but after taking a commission, they disappear without a trace.
Operations with maternity capital through microfinance organizations offered good prospects for fraudsters. However, since 2015, microfinance organizations have been officially prohibited from working with maternity capital.
This forced measure was taken after some companies cashed out several billion rubles of public money using fraudulent schemes.
To avoid fraud, I advise certificate holders to act only through official channels - the Pension Fund of the Russian Federation, large banks and government agencies.
6. Prospects and new opportunities for using family capital
New opportunities for the use of maternal capital are often provided by regional structures. Thus, in some regions of the Russian Federation it is already possible to purchase not only real estate, but also furniture, household appliances and other goods with these funds.
Among the real prospects on a federal scale is the possibility of purchasing a car for the whole family with MK money. There is a separate material on this issue on our resource “ Buying a car with maternity capital».
A woman who gave birth (adopted) a second or subsequent child from January 1, 2007 to December 31, 2021 can obtain a maternity capital certificate immediately after birth baby or later at any convenient time, since the deadline for applying for him is not limited.
After submitting a complete application, PFR specialists review the information provided by the applicant in within 1 calendar month and make a decision to issue a certificate or to refuse the applicant to receive it. Within 5 days, the applicant is sent a corresponding notification of the decision.
You can send funds provided for by this program of state support for families with children (in 2018): after 3 years after becoming eligible to receive a certificate. This can be done in the following areas:
- without attracting loans or borrowings;
- or his maintenance in kindergarten;
However, in the following two areas it is possible to realize maternity capital, in connection with the birth or adoption of which this certificate was issued:
- payment of a down payment or principal and interest taken out for the purchase or construction of housing, including a mortgage;
- purchase of goods intended for .
An application with the appropriate package of documents for the sale of family capital is considered by Pension Fund employees within a period not exceeding 1 month After a positive decision is made, the money is credited to the account specified in the application, depending on the direction of use of the maternity capital, within another 10 working days.
When can you receive maternity capital after the birth of a child in 2018?
Period of application for obtaining a certificate for maternal family capital is not limited. The main condition is the birth (adoption) of a second or subsequent child during the period from 01.01.2007 to 31.12.2021.
You can obtain a certificate by submitting an application with the appropriate list of mandatory requirements:
- to the territorial administration of the Pension Fund of the Russian Federation (PFR);
- to the Multifunctional Center;
- through the public services portal;
Employees of the Pension Fund during one month:
- will check the accuracy of the information submitted by the applicant;
- correctness of filling out the application;
- request the necessary additional information about the recipient from the relevant government organizations;
- will make a decision to issue a certificate or refuse (with justification of the reasons).
During 5 days After the relevant decision is made, a notification is sent to the applicant. If the decision contains a refusal to issue a certificate, then the relevant legal grounds are indicated there.
How long does it take to use the certificate?
After receiving the certificate, many families have a question about when can you use maternity capital?. It should be noted that the permissible period for applying for the sale of maternity capital, as well as for obtaining a certificate, is not limited.
However, if the certificate was received before the child for whose birth it was issued, three years old, then you can immediately dispose of it only for:
- making a down payment or payment;
- purchasing goods to society.
Maternity capital can only be used for the following areas: after the child reaches 3 years of age:
- or paragraph 1 of Art. 8 of the above law during 1 month and make a decision on the transfer of funds or refusal to transfer money.
Based on Government Decree
Maternity capital today is a very tangible state support for many large and young families with two or more children. The legislative framework makes it possible to use the available preferential funds in order to:
- Improve the conditions of the family’s current residence in the form of major repairs, including reconstruction, the purchase of finished housing or its share, as well as the construction of a private residential building on a plot of land;
- Pay for the child’s education in paid preschool, school and higher educational institutions with a state license, as well as accommodation in a hostel on the territory of the Russian Federation;
- Increase savings for the mother’s pension or, in some exceptional cases, the father’s;
- Purchase the necessary equipment for children with disabilities.
The above categories have some limitations. For example, housing is located only within the boundaries of Russia in the ownership of family members (only spouses and children), payment for education for children under twenty-five years of age, compulsory Russian citizenship, as well as the period after which one can take advantage of financial assistance from maternity capital.
In fact, the time frame within which government assistance can be used for the same purchase of housing depends on the age of the children and the intended purpose of the payment.
Who is eligible?
Before considering any deadline, it is important to consider some of the nuances of obtaining the certificate itself. This is especially important in a subsequent transaction or mortgage to purchase a home. The current legislation and together with it the conditions of the social program for calculating maternity capital make it possible to issue a certificate in the name of:
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Particular attention should be paid to such rules for families in which only one spouse has Russian citizenship or in which the mother, for some reason, cannot obtain a mortgage for herself. This is due to the fact that maternity capital can be used to purchase a home only when the mortgage, purchase and sale agreement and title of ownership are issued in the name of the recipient of the certificate, regardless of whether the established period has passed and all requirements have been met. Moreover, we should not forget that the certificate cannot be cashed.
How much to wait?
Of course, one of the exciting questions is after what time and within what period can the issued certificate for maternal capital be used according to the law. Speaking about increasing pension savings and paying for educational institutions, this period is three years after the birth of the second child.
However, when funds are used to purchase housing, the following can be noted:
The period for consideration of the application and documents submitted to the Pension Fund institution at the place of residence of a family with children is approximately one month. Further, within five working days after the decision is made, the responsible officer must send the applicant written notice of what decision has been made.
Don't neglect
Considering the fact that the term is not the only strict limitation that can be attributed to some barriers to the use of maternity capital, citizens need to take into account the associated nuances. For example, there are cases when parents tried to spend the certificate to pay for consumer loans, issuing them for the purchase of any housing, sometimes buildings that are not at all suitable for habitation. Since today there is no clear supervisory authority, it is necessary to indicate in contracts what the loan was taken for. If there is no such mark in the documents, you will have to prove through the court that the loan was actually taken out to purchase a home.
You should also not draw up contracts that mention installment plans. Maternity capital can only be used to repay a loan when it comes to real estate.
Considering the latest legislative changes and the fact that the validity period of the social program for payment of maternity capital has been extended, everything needs to be carefully planned. We have been talking about the abolition of maternity capital for several years now, so it is better to take advantage of it while the opportunity still exists.
What should you be prepared for?
There are no restrictions on the period for obtaining the certificate. It can be issued not immediately after the birth of the second child, but after the birth or adoption of the third or fourth. There is also no limitation on the period of use of the received certificate for maternity capital required by law. That is, it is not necessary to spend it immediately after three years. However, this would be illogical, given the fact that one of the intended purposes of this state assistance is to pay for education. Although there is an interesting point here and it is that you can pay for education with maternity capital only until the child reaches twenty-five years of age.
Whatever the intended purpose is chosen, the recipient of the certificate will need to prepare all the necessary documents in advance, no matter how long they have to wait. The list of required papers will depend on the individual case and must confirm its focus so that Pension Fund employees have no doubts about where the budget funds are going.
If an incomplete list or false information in documents is provided, the applicant will be refused. And if you try to commit fraud and cash out funds, you may even lose your freedom for several years.
The maternity capital program has undergone many changes, but one thing has remained unchanged - this amount has quite seriously helped many families and has become a kind of impetus for demographic growth.
Almost every year the state carries out indexation of maternity capital, and currently amounts to 453,026 rubles.
Terms of use
As the law says, maternity capital can be used in the following:
- Formation of a pension for the child’s mother;
- Children receiving education;
- on the territory of the Russian Federation;
- Purchasing various services and goods necessary to integrate and adapt children with disabilities into society.
Legislative aspect of the use of funds in the first three years
The seventh article 256 of the Federal Law specifies the exact terms of use of those funds intended for maternity capital.
Here are following rules:
- If the baby’s mother has the right to a certificate, she can dispose of it only after 3 years have passed after adoption, or after the child is born. In order to receive a maternity certificate, you must submit documents to the Pension Fund.
- If the child’s parents are deprived of their rights or have died, and the certificate has not been cashed during this time, then the right to it passes to the child. However, he will be able to use it only after he reaches adulthood.
Features of cashing out
In 2019, maternity capital will apply to all same rules, which were also in effect in 2018. Namely:
Well, if we talk about the age of three, then, indeed, you can cash out capital only after the child has turned 3 years old. After this age, parents can spend the certificate on a pension for the mother and education for the children.
What and under what conditions can funds be spent until the child is 3 years old?
However, as the law states, parents of a child under three years old still have the opportunity to spend Maternity Capital in 2019 on some goals. Among them:
- in the amount of the subsistence minimum for a child up to one and a half years old;
- , or repayment of a certain amount for living space already taken.
- Adaptation of children with
In all of the above cases, parents have the right to spend Maternity Capital received for a child under three years of age.
If we talk directly about the use of maternity capital up to three years for housing needs, then the situation is as follows:
- Purchase of housing under construction or ready-made housing. According to Law 256, you can use the certificate after the child turns three years old, or to purchase an apartment or, as well as to purchase a room. This is under normal conditions. If you are going to take out a real estate loan, then you don’t have to wait three years, but spend all or part of the amount when you want.
- There is one more aspect regarding maternity capital and housing. The certificate can be spent without waiting for the child to turn three years old, if your family has land obligations for the fulfillment of which you intend to use the funds. Moreover, it is important to understand that land obligations do not necessarily have to be mortgages. But! They should be used for construction, reconstruction, as well as the acquisition of premises.
Thus, a family where a second child was born has many options for how to spend capital until the child turns three years old.
Currently, there are many rumors about what the certificate can be spent on in 2019 before the child reaches three years old, here are just a few of them:
- Using the certificate, you can repay a car loan. In fact, this option was considered in the State Duma, but was not supported.
- Also, almost every year a rumor appears that a certificate is given not only for the second, but also for the first child. In fact, in 2019, a certificate will not be given for the first child, but this option is also being considered in the State Duma.
- There was also a rumor that the state could not cope with payments and planned to cancel maternity capital in 2019. It is not true. Moreover, the program has now been extended until December 31, 2021!
- Also, at one time it was planned to allow in 2018 to pay for the education of parents with the help of maternity capital, but the bill was never adopted, although it currently remains under consideration and, perhaps, will come into force someday.
As you can see, there are many rumors, but you shouldn’t believe them all. In order to obtain complete information on the Maternal Material, you should contact the nearby Pension Fund, where you will be provided with truthful conditions for the program and a complete list of documents.
Procedure for receiving funds upon early use
In order to take advantage of maternity capital for up to three years next year, you should do the following:
As the law states, you do not have to use the entire amount allocated under the certificate. For example, you can spend a third of the money, and leave the remaining funds so that they undergo indexation in the future, if any.
List of documents provided
If you decide to take out a mortgage on your home, or pay off your housing debt with maternity capital, then you will need to collect following documents:
You will also definitely need your personal documents, namely:
- Passport of not only the mother, but also the father (a photocopy will do);
- Certificate for the provision of state aid (here you will need not only a photocopy, but also the original);
- Birth certificates of all children in the family (both originals and photocopies will also be needed here).
All of the above documents must be submitted to the Pension Fund.
Monthly payments from maternity capital
On the initiative of the President of the Russian Federation, since 2018 it has been possible to use maternity capital funds for monthly payments for a second child. Federal Law 418-FZ dated December 27, 2017 established that if a second child is born in a family after January 1, 2018 and if the family’s average per capita income does not exceed 1.5 times the subsistence level of the working population in the region, then the Pension The Russian Federation Fund can assign a monthly payment for a period of 1 year from the birth of a child in the amount of the subsistence minimum per child in the region where the family lives. This state aid is popularly called .
The use of funds before the child reaches 3 years of age is described in the following video:
One of the measures of social support for families who have a second and subsequent child is a family certificate. Parents who had a child born in 2007 or later have the right to receive funds from the state budget. If the issuance of a certificate is possible immediately after the birth of the baby, then it can be used only after reaching a certain age. Maternity capital up to 3 years can also be realized, but only if funds are used to improve housing using borrowed funds.
Conditions for issuing the certificate
The main provisions regarding the receipt and sale of family capital are given in Federal Law No. 256, adopted in 2006.
Basic Rules
The terms and conditions for the implementation of the program are established by paragraph 6 of Art. 7 of the above law:
- the general right to use funds to pay for education, pension savings, and home improvement arises three years after the birth of the baby;
- the basis for sending funds from the state budget to a specific family is an application submitted to the territorial branch of the Pension Fund of Russia;
- In the event of the death of parents or deprivation of rights when transferring the baby to state support, the child personally will be able to use maternity capital, but only after reaching adulthood.
Requirements for housing purchased with maternity capital
Parents and other persons entitled to a family certificate have the right to use funds to purchase private houses and apartments on the secondary market and among new buildings.
The purchased housing must meet certain requirements set by the Pension Fund:
- the property is located within the Russian Federation;
- the apartment or house complies with established sanitary and hygienic standards;
- the acquired property is recognized as a full-fledged comfortable residential property.
An important condition must be taken into account when using capital for housing - shares in a new apartment or house must be allocated to all family members.
How to spend maternity capital up to 3 years
Despite the general rule that allows you to dispose of a certificate only after 3 years, an exception has been established.
According to clause 6.1 of Article 7 of Federal Law No. 256, funds can be spent without waiting for the child’s third birthday if the money is used to purchase housing using housing loans. Thus, if there is an urgent need to obtain more comfortable living conditions, parents can contact the bank and apply for a mortgage.
If you do not have your own funds for the initial capital, the solution will be to attract budget funds through a family certificate as a down payment.
The state program allows almost every family with two or more children to become owners of their own modern housing, providing their minor wards with decent living conditions and development.
The main criterion for using maternity capital for up to three years is the participation of the banking structure in financing the transaction. This step is caused by the need to ensure control over the targeted allocation of budget funds within the framework of the areas prescribed by law. The state compensates part of the funds from the debt to the credit institution in the amount of maternity capital valid at the time of citizens’ application.
In 2017, families have the right to count on compensation in the amount of 453 thousand rubles if during the year they allocate maternity capital funds to a transaction agreed with the Pension Fund of Russia.
Most families write an application to transfer the amount due under the family certificate to pay off existing mortgage debts. However, there are alternative options that are also closely related to targeted bank lending. The country's largest banks provide comprehensive support in organizing such transactions and advise on issues of obtaining mortgages using maternal capital.
Main directions
The legislation considers the following options for disposing of a family certificate for parents who want to solve housing problems without waiting until the child turns three years old:
- Directing funds to repay the principal debt (loan body) on a mortgage loan previously issued for the purpose of improving housing.
- Compensation for interest accrued by a credit institution for the use of borrowed funds for the purchase or construction of housing.
- Accounting for capital as a down payment under a mortgage agreement with a bank.
The main common feature of all the above options is the exclusion of parent borrowers as a link in the chain of transfer of funds. The money is sent directly to the bank using the details specified in the mortgage documents and in an amount not exceeding the balance of the debt or the amount of the family capital.
Paying off an existing mortgage
When taking out a mortgage, borrowers plan to repay the loan as soon as possible, saving the amount of accrued interest on early repayment. However, in practice, a lot of unforeseen situations arise that impede the execution of the plan.
The birth of a baby is always associated with additional expenses and an increase in the financial burden on the main breadwinners in the family. In this case, the law allows state assistance to be directed towards full or partial repayment of a housing loan, provided that the housing meets the requirements of the Pension Fund of Russia and the parent-certificate holder has executed a notarized obligation to allocate each family member a share in the purchased mortgaged apartment.
In addition to purchase and sale transactions, it is possible to receive compensation during the construction of a residential property or its reconstruction.
The procedure for receiving funds consists of several steps associated with interaction with the following parties:
- credit institution;
- Pension Fund;
- the seller of an apartment or other residential property.
Before the creditor receives the funds, approval will be required from the local branch of the Pension Fund.
Features of the procedure
The process of selling maternity capital funds in the event of repaying an existing mortgage is simpler and eliminates the steps of finding suitable real estate and pre-approval of the transaction from the bank.
At the first stage, the parent who has received a family certificate applies to the Pension Fund with an application for disposal of funds under the state program and provides a full package of documents for the property, the borrower and his family members, a mortgage agreement and certificates from the bank.
The complete list is as follows:
- current mortgage agreement (copy);
- information from the lender about the amount of the remaining mortgage debt and interest (original);
- apartment security agreement;
- certificate of registration of ownership in Rosreestr (if available, for an apartment that has already been built and put into operation);
- documents establishing the right to an object under construction (when purchasing an object that has not been put into operation);
- agreement on shared construction (if an apartment is purchased in a building under construction);
- when sending funds as payment of a loan debt on shares or entrance fees, they request an extract from the register of the housing cooperative;
- permitting documents for the construction of a house (if the property has not yet been completed);
- a written obligation to register the apartment as the property of all family members.
Fund employees will review the application and check documents within a month. If all the conditions for the sale of capital are met, the Pension Fund makes a positive decision and transfers the funds according to the details of the mortgage account at the bank.
After the funds are credited, the lender makes a recalculation, reducing the monthly payment amount taking into account the reduction in the amount of debt. If the funds on the family certificate are not fully spent, the remainder can be used for other legal purposes.
To pay the down payment
In the process of implementing the state social program to help Russian families, its rules are adjusted and supplemented. Thus, in 2015, according to the enacted law No. 131-FZ, families who could not find start-up funds were given the opportunity to take out a mortgaged apartment, using the funds from the family certificate as a down payment on the mortgage. Before the law came into force, such a right arose only when the child reached the age of three.