As it should be by law

The main standards on a given topic are set out in special federal law No. 1510 of 07/04/1991. In addition to the basic principles, restrictions are listed. In particular, only adult residents with permanent registration are allowed to privatize an apartment. However, there is no prohibition on the gratuitous transfer of state real estate to private individuals due to debt. There are no similar obstacles in the rules for registering real estate (Federal Law No. 218 of July 15, 2015).

Nevertheless, according to the current Housing Code (Article 83, paragraph 4, paragraph 1), the municipality has the right to apply to the courts with a request to terminate the social contract. This collection of regulations states the obligation of residents to pay rent for:

• consumed energy and other resources;
• public utilities.

An exception is made only for major repairs. However, other positions are quite enough to accumulate significant debt. In this case, what matters is not the total amount, but the fact that there have been no regular payments for the last 6 months.

For your information! The law allows you to privatize an apartment with debts, but in practice you may encounter administrative refusals.

How it happens in practice

Based on the data presented, two conclusions can be drawn:

• an apartment with a debt can be privatized legally;
• The municipality is able to apply specific enforcement measures only by appropriate decision of the courts.

However, in practice, obstacles arise during the procedure for transferring real estate into private ownership. In order to force the tenant to repay the debt, management company employees do not issue certificates of registered tenants. Responsible employees of the local administration refuse to accept documents for the privatization of real estate with rent arrears. Below are ways to solve the identified problems.

They do not issue a certificate to the Criminal Code

To privatize an apartment (with or without debts), they provide a personal account and an extract on family composition. To obtain these documents, the responsible tenant contacts the office of the management company.

If the responsible employee refuses to issue certificates, you should refer to a gross violation of the following Federal Laws (both dated July 27, 2006):

• 149 (art. 8);
• 152 (vv. 14, 20).

In some situations, negotiations with the head of the relevant organization will ensure a positive result. If a “peaceful” solution to the problem is impossible, they contact the prosecutor’s office (housing inspectorate) on the basis of the rules of the Code of Administrative Offenses (Article 19.1 - arbitrariness).

For your information! Sometimes you can complain about the Criminal Code online - through the website of the housing inspectorate or the prosecutor's office.

Administration is denied

You can appeal the decision of local executive bodies in the courts. The statement of claim must be filed no later than three months from the date of receipt of the relevant refusal. Officials make a refusal to privatize an apartment with debts in accordance with current regulations in writing, with the obligatory indication of the reasons.

Having studied this data, they make an appeal to the court. If debts are noted as the reason, a positive decision in favor of the plaintiff can be obtained within 1-2 months. It, along with the necessary accompanying documents, is transferred to the Rosreestr branch for re-registration of ownership to a private owner.

The consideration of the case may take 5-6 months or more. It is possible that counterclaims will arise with demands for payment of debts. To eliminate unnecessary risks, you must carefully prepare convincing evidence that you are right. In difficult situations, you can only privatize an apartment with a debt with the help of an experienced lawyer.

Attention! Download the court claim form.

They threaten to terminate the social rent agreement

Termination of a social tenancy agreement with relocation and other compulsory actions is permissible only by court decision. During the proceedings, the following are taken into account:

• loss of employment, other objective reasons for temporary deterioration in financial situation;
• compliance of the apartment proposed for relocation with current housing standards;
• presence of dependents and minor children in the family.

The municipality has the right to claim only debts for the last three years. Additionally, court costs, fines and penalties may be charged.

Conclusion! If employees threaten to terminate the employment contract “as early as tomorrow,” you need to remember that if there is a large debt, this is only possible through the court.

Appeal in court

You can prepare a statement of claim against the privatization body yourself. To do this, it will be necessary to prepare a text with links to regulations. A copy of this document is sent by registered mail to the defendant (privatization body).

The claim must contain the following points:

• name, details of the privatization body;
• personal data of the applicant;
• reasons for application (refusal of privatization);
• substantiation of violations of the law in connection with the adoption of this decision;
• demand to the court (cancellation of refusal and recognition of property rights).

Attached to the document:

1. A copy of the refusal of the privatization body.
2. Social tenancy order or contract.
3. An extract from the house register, which indicates the persons registered in the apartment.
4. Certificate of debt status for utilities and rent. If you have recently paid off part of a debt, it would be good to confirm this with receipts.

As an attachment, a certificate is also provided stating that the applicant has not previously participated in privatization, as well as a receipt for payment of the state duty.

Where to contact?

You should contact the district court at the place of residence of the plaintiff or location of the defendant.

The claim may be:

• on recognition of property rights;
• with a requirement to oblige to conclude a privatization agreement;
• on declaring the refusal to privatize illegal.

You can also prepare a complaint to the head of the privatization body , but as practice shows, this is not the most effective way to solve the problem.

It is preferable to file a claim for recognition of ownership rights. If the case fails, then you won’t have to contact the administration again. With a court ruling, you can immediately go to Rosreestr to register property rights.

Timeframe for making a decision

The trial can last 2-3 months. Sometimes this process drags on for a longer period. If the claim is denied, you can file an appeal or still pay off the debt and re-submit documents for privatization.

The debt is large, but there is nothing to pay

How to privatize an apartment in a difficult financial situation is decided after carefully checking several important factors. They start by clarifying the size of the debt. The maximum period for filing a claim for debt repayment is 3 years - the management company will not be able to collect older debts even through the court.

If there is still a risk of debt collection through the court, and the amount is significant, you can achieve through negotiations with the management company:

• deferred payment;
• distribution of payments in small amounts over a long period of time;
• writing off part of the debt;
• settlement after the sale of privatized housing.

Agreements are made in writing. If necessary, with notarization. After reaching a consensus, you can privatize the apartment with debts according to the standard scheme. Of course, we should not forget about fulfilling the agreed obligations.

Large debt can be paid off with consumer lending. It should be understood that such programs have higher interest rates. In this situation, it will not be possible to register real estate as collateral as security for the repayment of the loan received. It is necessary to evaluate objectively other types of guarantees:

• level of regular income;
• use of guarantors;
• attracting co-borrowers.

Attention! It is not recommended to contact microfinance organizations - there is a risk of multiplying the debt due to the high interest rate. It is better to get a loan from a bank.

The procedure for privatizing an apartment with debts

You can privatize an apartment using the standard algorithm:

• clarify the opinions of other owners on the implementation of privatization, formalize consents/refusals;
• receive O&P permission if there are minor children registered at this address;
• collect supporting documents;
• contact the relevant department of the local administration;
• after a positive decision, a privatization agreement is signed;
• if they refuse, they act according to the methods discussed above (they go to court, the prosecutor’s office);
• complete the procedure by registering property rights in Rosreestr.

List of required documents

To carry out privatization you need to prepare:

• participants' passports;
• refusals of other residents;
• consent of the OiP (if the child refuses);
• technical passport (extract from Rosreestr) with data on the technical parameters of the property;
• order, social rental agreement;
• confirmation of the absence of debts;
• information about registered residents.

Important! Download the privatization application form.

Contacting the administration

In order to privatize an apartment with debts without unnecessary problems, they check the composition and condition of the accompanying documentation in advance. If necessary, old originals are restored using archival data. It is preferable for all interested persons with identification documents to be present in person at the time of application.

For your information! When privatizing an apartment, we must not forget about temporarily absent residents. They have the right to a corresponding share of the real estate.

According to current regulations, the administration must give a positive (negative) answer no later than 60 days after completing the application for privatization.

Registration in the Unified State Register of Real Estate

The received positive decision of the municipality is the basis for concluding an agreement on the transfer of state property to private owners. The signed agreement along with the application is sent to the MFC office. The state duty is the same in any case - 2,000 rubles. Registration speed (working days, maximum):

• 7 – “Rosreestr”;
• 10 – MFC;
• 3 – through a notary.

An application for registration will be filled out by an employee at the reception at the MFC. There is no need to fill out anything in advance.

Details of privatization with rent arrears

Additionally, they can request an extract from the house register to see where each participant in the privatization lived previously or a certificate of minors who have been discharged, and others. The list of documents in each individual case will be provided to the applicant in the privatization department or the Housing Policy Department.

• passports of all those permanently registered in the premises;
• for minors who are registered in the apartment together with both or one of their parents, birth certificates are submitted;
• a social rental agreement that the owner of the premises concludes with the main tenant;
• order for an apartment;
• registration certificate, which is issued by the BTI;
• a certificate stating that previously persons wishing to take part in privatization did not receive ownership of housing from the state;
• an extract from the personal account, which should indicate the presence or absence of rent arrears;
• certificate of composition registered in the premises.

We recommend reading: Is it possible to privatize residential premises only for a minor child?