Anna Tavolzhanskaya, notary of the Chamber of Notaries, answers:
Perhaps the main problem with completing this transaction can be considered the non-participation in the privatization of the apartment of the seller’s daughter, who was a minor at that time.
Despite the fact that previously the law allowed the privatization of residential premises in the name of only adult family members, judicial practice recognizes such privatization agreements, as well as subsequent contracts for the alienation of residential premises, as invalid. That is, having bought such an apartment, the buyer may after some time receive a claim from a former minor member of the seller’s family, on the basis of which the purchase and sale agreement may be declared invalid by the court. Determining the limitation period for such claims is currently a question that does not have a clear answer. In the most unfavorable circumstances, this period is 1 year from the moment when the former minor learned about the violation of his rights. Therefore, having decided to purchase such an object, buyers need to have proof that the seller’s daughter knew that the apartment was privatized without her participation. This circumstance can be confirmed by a statement of appropriate content signed by the daughter. It is advisable that this statement indicate that she has been aware of this fact for more than a year. It is recommended that the signature on the application be notarized. Social media messaging is not reliable evidence in this case. Is a child an owner in a privatized apartment?
What is the risk of buying an apartment that was privatized in the 90s?
It should be taken into account that if such a legal dispute arises, it is impossible to give a 100% guarantee that the court will refuse to satisfy the claims of a former minor. In addition, persons who lived in the residential premises, but did not participate in its privatization, can claim to retain the right to use this residential premises even after its sale. In the situation under consideration, such a person is clearly the daughter of the seller, and also, possibly, his wife. To protect the rights of the buyer when concluding an agreement for the purchase and sale of an apartment, it is necessary to obtain from these persons a document confirming their renunciation of the right to use the apartment after its alienation. It is also advisable to register these waivers with a notary.
A certificate stating that a participant in a transaction is not registered with a psychoneurological dispensary does not guarantee that he is aware of his actions, is fully aware of the meaning of the transaction being concluded and sincerely desires the corresponding consequences to occur. A more reliable proof of these circumstances can be the conclusion of a psychiatrist received on the day the contract is signed. Moreover, the advanced age of the transaction participant and the presence of serious diseases, including cancer, are factors that complicate the situation. Additional protection for the buyer can be provided by notarization of the transaction. In the event of a legal dispute, the notary will confirm that the parties to the transaction were in adequate condition.
Also, complicating factors include the participation in the transaction of a representative acting on the basis of a power of attorney. The first important point that needs to be checked in this case is the question “Is the owner of the premises alive at the time of concluding the purchase and sale agreement?” After all, a power of attorney expires upon the death of the principal. The buyer can verify that the principal is alive by communicating with him. In addition, in the case of notarization of a purchase and sale agreement, the notary has the opportunity to verify the relevant circumstance by sending a request to the electronic register of the civil registry office.
The second important point is to check the cancellation of the power of attorney. The fact of cancellation of a notarized power of attorney can be checked on the website of the Federal Notary Chamber. It is also advisable to check not only the fact of cancellation of the power of attorney, but also the fact of its issuance in order to protect against forgery. This can be done by contacting a notary. When notarizing a transaction, the notary will necessarily request all the necessary information about the power of attorney from the Unified Notary Information System and check the fact of its execution, the authenticity of its content, and the absence of orders to revoke it.
Since in the situation under consideration the privatization agreement was concluded by the seller before January 31, 1998 (before the Law “On State Registration of Rights to Real Estate and Transactions with It” came into force), there is a possibility that information about his ownership is not included in the Unified State real estate register (USRN). Sometimes this circumstance creates unnecessary difficulties when registering the transfer of ownership of an apartment to the buyer in Rosreestr. To ensure a hassle-free registration, you must ask the seller to register his ownership in the Unified State Register of Real Estate before selling the apartment.
Does a child who did not participate in privatization have the right to an apartment?
Is it possible to challenge privatization because of a child?
The parties to the purchase and sale agreement have the right to agree on any price for the apartment being sold. However, if the apartment is sold at a price that is clearly below the market price, in order to protect against the occurrence of a future legal dispute based on this circumstance, it is advisable for the buyer to receive a statement from the seller, which will reflect that the seller is aware of the size of the market price of the apartment and the price in the contract is determined by him to be lower than the market price consciously. This application must be completed by the owner of the apartment in person, and not through a representative by proxy.
In conclusion, we can once again recommend drawing up the purchase and sale agreement in notarial form. In the case of notarization of the contract, the notary is the guarantor of the legality of the transaction. He is responsible for the compliance of the transaction with the law, including studying and analyzing all legal aspects, checking the submitted documents, drawing up a legally competent draft agreement, explaining to the parties the consequences of the transaction, and ensuring that the transaction complies with the intentions of its participants. In addition, when notarizing the purchase and sale agreement, documents for state registration of the transfer of ownership can be submitted by the buyer without the participation of the seller. When concluding a transaction in simple written form, registration documents must be submitted by both parties to the agreement.
How to protect yourself when buying an apartment
When buying an apartment both on the secondary market and in a new building, there is always a risk of meeting an unscrupulous owner. Especially in cases where the buyer does not turn to professional realtors and lawyers. Even when purchasing real estate directly from the developer, the buyer cannot be 100% sure of the reliability of the project. The sad experience with long-term construction projects and thousands of defrauded shareholders is a clear confirmation of this. However, you are much less likely to fall into the hands of an unscrupulous seller on the primary market if you choose a developer responsibly. It is worth choosing large, time-tested developers, studying in advance all the necessary constituent, title and design documentation, as well as analyzing information on the quality and timing of construction of other projects of the same company and the availability of a stable source of financing.
As for the secondary market, it is more risky, since apartments can have a rich history of transfer of ownership, which is difficult for even the most experienced lawyers to understand all aspects of. To avoid risks, you should only contact real estate agencies that have proven themselves in the market. They value their business reputation, so they approach the legal examination of objects with particular care. Regardless of whether you decide to buy a property yourself or trust market professionals, there are 3 key points that you need to find out before concluding a deal: who is selling the property, what is the history of the transfer of rights to the property and a comparative analysis of the cost. Let's take a closer look at each question.
1. Who is the owner of the apartment, and who is the owner’s representative? It is important to understand whether the owner or trustee is selling the property. Clearly, conducting a purchase and sale transaction with a trusted person is extremely risky. The power of attorney can be revoked long ago. Most likely, such a transaction will be declared invalid in court, so there are no guarantees that the buyer will be able to get his money back. In such ambiguous situations, you should not rely on luck, but it is better to immediately contact competent lawyers.
2. What is the history of the transfer of rights to the apartment and are there other applicants? Before purchasing an apartment, the buyer must make sure that after the transaction is completed there will be no more applicants, for example, minor children or heirs. It is imperative to study the information websites of the courts at the address of the property and according to the owner’s data, obtain an archival extract from the house register, and track the movement of all persons ever registered in this living space. Also, the seller’s attempt to hide the presence of any encumbrances and illegal redevelopment does not speak in favor of purchasing this property. Obtaining technical documents from the BTI and extracts from the Unified State Register in this matter is mandatory. But a bona fide seller should already have all the necessary documents available.
3. The cost of the apartment and the reasons for its sale. The first thing that should alert the buyer is the cost is significantly lower than the market price, the second is the reasons for the urgent sale. Before purchasing, you need to analyze the cost of the property and compare the price with analogues in the same location. Free cheese is only in a mousetrap, so when you see an apartment 50% below its market value, this most likely indicates that there are some circumstances forcing the owner to sell the apartment significantly below the market value. As a rule, the seller is silent about the reasons for such an unfavorable deal for him. The situation in the real estate market is difficult now, and many property owners are actually reducing prices by 20-30%. This happens when the apartment is on display for many months or even years, and there are still no buyers. But there is a logical explanation for this: not the most convenient layout, poor quality and old, or, on the contrary, too specific finishing, unfortunate location of the house - the so-called illiquid property. In other cases, such a significant discount is a reason to be wary. It is also important to pay attention to the frequency of changes in ownership. If they have changed several times, then perhaps this indicates unfavorable living conditions. Naturally, you should refuse the purchase.
Separately, it is worth noting that if you are confident in the legal purity of the transaction, this is not a reason to lose vigilance, because there are risks both at the stage of mutual settlements, including using a cell, and at the stage of registering the transaction. Since the fact of ownership is confirmed by state registration of the transaction, you should not transfer funds until this moment. There is a possibility that the seller will disappear along with the payment, and the buyer will be left to plunge into long legal battles.
Author of the article: Elena Zemtsova, managing partner of Delta estate
Anatoly Pysin, General Director of the TsDN agency, answers:
Of course, the deal the author of the question is planning is both difficult and contested. In particular, the fact of a sale “below the market” in the future may be a strong argument in the hands of those who want to invalidate it. I would recommend that the legal review carried out be assessed by an independent specialist. He is responsible for the result within the framework of the contract concluded with him.
In any case, you should pay attention to the following nuances:
- The oncological disease of the seller's representative pushes the already difficult transaction even deeper into the risk zone. The medications taken may affect the capacity of the trustee.
- If the seller cannot be physically present at the transaction, you can come to him and sign the purchase and sale agreement where it is convenient for him. If this is not possible, you should check the power of attorney (whether it has been revoked) and conduct the transaction with the notary who issued it.
- The seller’s representative - the spouse - due to her age, must immediately before the transaction undergo a medical examination to determine her legal capacity and obtain the appropriate doctor’s opinion, including certificates from the IPA and ND.
The main risk, in my opinion, is that the minor daughter did not take part in the privatization. Communication on social networks is not legally significant. You cannot enter into a transaction without receiving a notarized consent from her, in which she must confirm that she knows about the upcoming transaction, knows about the infringement of her rights in the privatization process, and that she agrees with everything that is happening and will not make any claims in the future. Notaries have a form for such a statement.
Children did not participate in privatization. Are they the owners of the apartment?
Should the owner's child participate in privatization?
