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State assistance in restructuring mortgage loans by the population. Concept and essence of the procedure

The financial crisis has added problems to the majority of Russians who previously took out a mortgage loan. It will help you avoid losing your home, perhaps your only one, and restore your solvency mortgage restructuring. This assistance is provided by the state through the Housing Mortgage Lending Agency (now known as JSC DOM.RF), reducing the loan burden by up to one and a half million rubles.

How it works?

Mortgage restructuring in 2019 became possible after the entry into force of the decree signed by Dmitry Medvedev on April 20, 2015 (Resolution of the Government of the Russian Federation dated April 20, 2015 No. 373 is currently called “On the main conditions for the implementation of the program of assistance to certain categories of borrowers for mortgage housing loans (loans ), finding themselves in a difficult financial situation, and increasing the authorized capital of the joint-stock company "DOM.RF").

The program provides loan reduction in the amount of up to one and a half million rubles at the expense of one-time forgiveness of part of the debt and/or replacement of foreign currency on a loan with Russian rubles at a rate lower than the rate of the corresponding currency established by the Central Bank of the Russian Federation on the date of restructuring. Monthly loan payments after restructuring are reduced to 11.5% per annum for loans taken in foreign currency, or to the percentage rate in effect on the date of restructuring for loans taken in rubles. In addition, the borrower is exempt from paying penalties accrued under the loan agreement.

Losses incurred by the bank as a result of restructuring are compensated by the state. Thus, the financial burden on the borrower is significantly reduced, and banks do not lose their money.

Required Requirements

In order to receive support and use the services of a mortgage restructuring agency, there are a number of conditions and parameters.

Firstly, they relate to the mortgaged housing itself, which is pledged to the bank.

  • This must be the borrowers' only home. Thus, mortgage loans for which several apartments or houses were purchased are not subject to restructuring. Borrowers are allowed to own other real estate, or rather, the total share in it is no more than 50% for all family members.
  • The size of the home also matters. It should be a small apartment or house. The resolution specifies the maximum permissible footage. For a one-room apartment no more than 45 square meters. m, for a two-room apartment - no more than 65 sq. m. m, and for three-, four-room, etc. this area should not exceed 85 square meters. m.
  • The purchase of housing and the issuance of a mortgage loan must be made no earlier than a year before the restructuring.

Eligibility for a subsidy

Secondly, the resolution clearly defines the categories of people who can apply for assistance from the state and not lose their housing by becoming a habitual defaulter. It included:

  • citizens who are parents or guardians (trustees) of one or more minor children;
  • combat veterans;
  • disabled people and parents of disabled children;
  • persons who are dependent on full-time students under 24 years of age.

Mortgage restructuring 2019 applies to bona fide borrowers who have experienced financial difficulties due to a decrease in their standard of living, for example, due to job loss. At the same time, they must document the fact that after making the monthly mortgage payment, from the total family income there remains for each family member less than 2 subsistence minimums established by the state in the region of residence of the borrowers. Or your mortgage payments have increased by 30 percent or more.

After all conditions are met, the borrower has the right to apply for mortgage restructuring. Even if this is not a complete relief from debt, but only a reduction in payments, it makes a mortgage loan more affordable.

Debtor's action algorithm

To receive financial support for a mortgage from the state, you must contact the bank branch where the mortgage loan was issued with an application for restructuring and a package of necessary papers.

Below is an approximate list of documents that are required to be submitted for consideration of your application:

  • passport;
  • loan agreement and annexes thereto (if any);
  • bank certificate indicating the repayment period and amount of debt;
  • a document containing information about the co-borrower’s income (income certificate);
  • documents confirming the validity of the reasons for the debt:
    • in case of loss of a job - a work book with a record of dismissal, a certificate of registration at the employment center as an unemployed person indicating the amount of benefits received;
    • for health problems - a certificate of illness from a medical institution;
    • if the amount of labor income decreases - a certificate from the employer about a salary reduction, etc.

Note! Since 2017, the provision of extracts from the Unified State Register of Real Estate is not required: JSC "DOM.RF" independently verifies the relevant information on real estate.

Please note that the above list is approximate and may be supplemented or changed depending on the specific bank. The processing time for an application may also vary (on average, up to 10 working days).

In conclusion, I would like to note that an economic crisis is not yet a reason to panic, because there is always a way out. Mortgages with state support are designed to help citizens who find themselves in a difficult financial situation solve their housing problem.

A new program to help mortgage borrowers for 2015-2016 has been approved - mortgage holders will receive up to 600 thousand rubles and a restructuring of foreign currency mortgages at the Central Bank exchange rate.
Prime Minister Dmitry Medvedev approved the new program
government assistance to mortgage borrowers who are experiencing problems with
payment of a mortgage (ruble or foreign currency). Maximum amount of assistance
is 600 thousand rubles, previously this amount was 200 thousand
rubles
Decree of the Government of the Russian Federation No. 373 of April 20, 2015 in
edition dated December 7, 2015 No. 1331.
You can count on help from the state in repaying your mortgage
citizens with one (or more) minor children,
raising disabled children, as well as combat veterans. This
categories of citizens will be provided with financial assistance from the Agency for
housing mortgage lending (AHML) for one mortgage loan per
up to 600 thousand rubles, but not more than 10% of the balance of the principal debt.
Money will not be issued in person; assistance will consist of:
conversion of a foreign currency mortgage at a rate not higher than the Bank of Russia rate or
writing off part of the principal debt, or reducing the size of the monthly
assistance payments for up to 18 months.
Foreign currency mortgage holders will be able to convert foreign currency mortgages into ruble
exchange rate of the Bank of Russia without commissions or reduce the monthly
payment up to 50% for up to 18 months. After restructuring size
The interest rate will be no more than 12% per annum.
When the payment amount is reduced to 50% for a period of 18 months, the amount of savings
on payments cannot exceed 600 thousand rubles and be more than 10% of
the balance of the principal debt on the date of application for restructuring.
How to get help paying off your mortgage
The borrower must contact the bank with applications for restructuring,
it is not necessary to have an overdue loan debt, but with
from the moment of registration of the mortgage before submitting the application, at least
12 months.
Income Requirements
However, the average monthly family income for 3 months before filing the application must
be less than at least 30% compared to average monthly income
for the same period before the date of conclusion of the mortgage agreement. Or
average monthly family income for 3 months before filing an application after deduction
the average monthly mortgage payment for the same period does not exceed two
living wages for each family member (borrower and co-borrowers).
In the case of a foreign currency mortgage, the size of the monthly payment for the last 3
there must be more than a month before the date of filing the application for restructuring,
at least by 30% compared to the amount of payment on the date of conclusion
agreement. After making such payment, the remaining amount of the borrower's income,
his family members and co-borrower should not have more than two subsistence levels
minimums in the region of residence.
Housing requirements
The property purchased with a mortgage must be the only residence and
belongs to the category of economy class housing, and its area should not be
more:
one-room apartment – ​​45 sq.m;
two-room – 65 sq.m;
three-room or more – 85 sq.m.
For families with three or more minor children, requirements for
the cost and area of ​​housing are not covered.
In this case, the family can have up to 1/2 shares in the aggregate in other residential
premises.
Banks where you can get help paying off your mortgage
Only those who can receive help from the state in repaying their mortgage
borrowers whose bank (or other organization) is a participant
the corresponding program. Participating in the mortgage assistance program are:
JSC AHML
Sberbank (PJSC)
VTB 24 (PJSC)
Gazprombank (JSC)
Bank "FC Otkritie"
JSC Rosselkhozbank
OJSC "Bank of Moscow"
UniCredit Bank
"Promsvyazbank"
ROSBANK
Raffisenbank
"BINBANK"
"Absolut Bank" (PJSC)
"Avtogradbank"
"AZHIK Voronezh region"
"AHML KO"
"AK BARS" BANK
"AKIBANK"
"Almazergienbank" JSC
AHML in the Tyumen region
"Bank BFA"
Bank "RRB" (JSC)
GLOBEXBANK
"Far Eastern Bank"
"DVITs"
"Devon-Credit" (PJSC)
"DeltaCredit"
BystroBank
"Bank ZhilFinance"
"Zapsibkombank"
Bank ZENIT
"Izhkombank" (PJSC)
"Kama Commercial Bank"
"Krayinvestbank"
"Credit Europe Bank"
"KUB" (JSC)
"Kuban Credit" LLC
"Kurskprombank"
Bank "Levoberezhny" (PJSC)
"LOKO-Bank" (JSC)
"METCOMBANK"
"MTS-Bank"
"SAFE HOUSE"
"NOAIK"
JSCIB "EDUCATION" (JSC)
"OTP Bank"
"Plus Bank"
"Primsotsbank"
"Proinvestbank" (PJSC)
"RosEvroBank" (JSC)
"Russian Capital" (PJSC)
"SPb TsJ"
"Svyaz-Bank"
"BANK SGB"
"Northern Credit"
"SMP Bank"
"SNGB"
"Sobinbank"
"AIKB "Tatfondbank"
"Timer Bank" (PJSC)
"TKB" (CJSC)
"Tomskpromstroybank"
"BOOM-BANK" LLC
"Ural FD"
"FIA-BANK"
"FORA-BANK" (JSC)
"Forstadt" (JSC)
"Khanty-Mansiysk Bank Opening"
"Center-invest"
"CHELINDBANK"
Regional Fund for the Development of Housing Construction and Mortgage
lending
"North-West 1 Alliance Bank"
LLC KB "RostFinance"
"AltaiBusiness-Bank" (OJSC)
"BINBANK Tver"
"CHUVASHKREDITPROMBANK" (PJSC)
LLC "AVENIR"
AHML Tambov region
OJSC "OblZHAIK"
List of documents for participation in the program
According to the Government Decree, creditors (including banks) have the right
independently generate a list of documents based on which
a decision will be made on the provision of state aid
borrowers. The list of documents for the restructuring of AHML is
approximate.

Given that the country's economy was faced with a sharp decline in the national currency, the standard of living of the population deteriorated sharply.

In this regard, the number of overdue loans has increased, which is why the need arose to provide state support to people who find themselves in a difficult financial situation.

Started operating in April 2015 Resolution No. 373 of April 20, 2015“On the basic conditions for the implementation of assistance programs for certain categories of borrowers for housing mortgage loans”, based on the provisions of which the groups of citizens who receive from the state budget are determined.

But not every client of a credit institution can count on it, but it makes life much easier for those who find themselves in financial difficulties.

The Resolution has been amended several times. Today for main categories of borrowers restructuring with state support is possible for 20% of the remaining amount, but not more than 600 thousand rubles. Therefore, the maximum size subject to restructuring has not been established. But this applies to people belonging to certain social groups.

It should be noted that, first of all, such a program is aimed to increase the authorized capital Mortgage lending agencies (hereinafter referred to as AHML).

Concept and essence of the procedure

Restructuring involves a revision by a banking institution of the conditions for issuing a housing loan at the request of the borrower.

Wherein may be revised:

Loan review available only if the applicant’s living conditions deteriorate and it is impossible to repay the mortgage in the same amount. This applies to situations when a person stops paying wages or is fired. In order for the provisions of the mortgage agreement to be revised, the applicant must present evidence of a change in the conditions of his residence. For example, this could be a work book with a corresponding entry.

But there is no need to mislead the banking organization; if its employees do not find any reasons for changing the clauses of the contract, the applicant will receive a refusal. Without serious financial difficulties, you should not apply.

In addition, the bank will refuse if the person is in arrears on monthly payments. It should be noted that restructuring is carried out only at the initiative of the borrower and will not affect his image in any way.

Considering that the material obligations incurred by the person who issued the loan are reduced, and this comes from lowering the loan rate to 12% per annum. In addition, the financial institution provides deferment in debt payment for one and a half years.

Part of interest During that period, the loan holder pays, and 50% is reimbursed by AHML. This makes it possible to organize your material condition. In this case, the credit institution does not lose anything, so banks willingly agree to this procedure.

Existing forms

Revision of the provisions of the agreement can be expressed in:

Requirements for the borrower and terms of implementation

Assistance to mortgage borrowers is provided with the mutual consent of all participants in the mortgage agreement.

By Decree of the Government of the Russian Federation dated April 20, 2015. determined rules for receiving state support. They are:

The state, represented by .

Everyone can count on it, but first of all it concerns privileged categories of people. They are:

  • Citizens with minor children. This affects both the natural child and those adopted and under guardianship;
  • Pensioners, veterans of various military operations;
  • People who have become disabled;
  • Parents raising disabled children;
  • Large families.

Order of conduct

Expecting to receive government support in the established amount, it is necessary take the following actions:

Required package of documents

To carry out the procedure will need to submit:

Deadlines

In accordance with the latest amendments made to the Government resolution, in 2019 minimum period of validity of the mortgage agreement on the day of filing an application for revision of the loan provisions does not matter and you can use state support at any stage of the credit line.

Advantages and disadvantages

Of course, there are pros and cons to implementing the process.

Regarding the bank, it is worth noting that it will always win. Besides, positive aspects are:

Basic but important negative point restructuring is served by an increase in the time of settlements with a banking organization, which may attract additional material costs for servicing the loan.

For information on the rules for allocating state aid to citizens who are unable to pay their mortgage, see the following video:

Obtaining a mortgage loan is a salvation for many Russians in need of housing. The amounts required to purchase your own apartment or house are sometimes so large that it is difficult to buy real estate on your own. Mortgage restructuring with the help of the state is a rational solution to the housing issue.

The state of crisis in which the country's economy has been for the last few years is affecting people's well-being. Mortgage repayment conditions, which were difficult even without economic difficulties, are becoming an unbearable burden for many families. In such cases, large banking organizations offer a mortgage restructuring service.

What is mortgage restructuring

Mortgage loan restructuring helps borrowers rid themselves of the debtor status in cases where it is difficult to repay the loan on their own. The terms of the restructuring provide for variability in monthly payment amounts and payment terms. This service can be used by all payers who meet the program conditions.

During the restructuring process, the parties revise the previously concluded loan agreement. The purpose of the revision is to make changes that are primarily beneficial to the borrower. When temporary financial difficulties are confirmed, the bank meets halfway, having secured an order from AHML.

  1. The steps a credit institution takes to ensure the borrower fulfills the loan terms may be as follows:
  2. Reducing the interest rate. This is possible if the level of development of the credit institution and the economic situation of the country allow this, for example, when the Central Bank rate was reduced after the signing of the agreement. The amount of savings the borrower receives is not significant on a monthly basis, but the amount saved over the course of a year can exceed the amount of one payment.
  3. Changing the loan payment currency. Since the depreciation of the ruble is directly related to the financial situation of many borrowers, the bank may decide to pay in dollars.
  4. Changing the repayment schedule. The lender may offer an option to change the payment amount for a certain amount of time: for 6 months, for a year. This time is enough for the borrower’s financial situation to stabilize. It is possible to reduce the payment amount by up to 50 percent.
  5. Providing credit holidays. The average period is 6 months. During the holidays, the borrower pays only the principal debt; he is exempt from paying interest during this time. In some cases, a complete exemption from making payments for a specified period is possible.

Restructuring a residential mortgage loan is a smart decision that brings benefits to both parties to the transaction. The bank is guaranteed to continue to receive payments, the borrower maintains a “clean” credit history without being included in the list of debtors. The existence of such a service in the banking market justifies itself. It is important not to accumulate debts, but to promptly contact AHML with a request for state support.

Role of the state

Borrowers in need of government assistance enter into a new mortgage agreement with a banking organization. This happens after a corresponding request is received from AHML, where the citizen must apply with the assistance of the bank. The agency's activities are regulated by legislative acts, since this organization is the federal operator of the project.

The last document signed by the Chairman of the Government of the Russian Federation Dmitry Medvedev is dated July 25, 2017 (Order of the Government of the Russian Federation dated July 25, 2017 No. 1579-r). The program provides for spending 2 billion rubles to help citizens who find themselves in difficult financial situations and have difficulties repaying their mortgage loans. The terms of the program are specified in detail in the Resolution dated April 20, 2015.

If the borrower meets the program requirements, then he can count on support from the state in the form of:

  • interest rate reduction: maximum – 12%;
  • writing off part of the principal debt on the mortgage (but not more than 200,000 rubles);
  • suspension of payments for a certain period;
  • non-collection of commissions related to the restructuring procedure;
  • currency changes.

Participation in this program is completely free for payers. Property pledged to the bank must meet the following requirements:

  • not be luxury housing;
  • the area of ​​a one-room apartment is no more than 45 square meters;
  • area of ​​a two-room apartment – ​​no more than 65 square meters;
  • The size of a three-room apartment is no more than 85 meters.

An apartment pledged to a lender bank, for example, Sberbank, is the borrower’s only home. If there are three or more children under 18 years of age in a family, the requirements for room space are not relevant.

After applying to AHML, the borrower who received a positive decision again contacts the bank, where the parties contractually choose the restructuring option. The new agreement will allow the citizen to fulfill his loan obligations in full, but with a short delay. The Housing Mortgage Lending Agency (AHML) will transfer funds to the bank in the amount of the concession made to the borrower.

Who gets help?

Not every citizen can become a participant in the state program. The agency imposes a number of requirements on borrowers. Categories of citizens who can apply for participation in the program:

  • combat veterans;
  • large families with at least one minor child;
  • persons with disabilities;
  • parents of disabled children or who are disabled themselves;
  • citizens with at least one minor child and under the age of 35;
  • citizens who are employees of government bodies and local government bodies;
  • citizens who are employees of state and municipal institutions, organizations of the military-industrial and scientific-production complexes.

All program participants must be citizens of the Russian Federation whose income has recently fallen below that confirmed at the time of obtaining a mortgage. For each family member, the income must be less than the sum of two subsistence minimums. The property taken on credit must be located in Russia.

Procedure

Anyone who meets the conditions of the program and wants to restructure a mortgage loan must first find out whether a bank, for example, VTB-24, cooperates with AHML. There is no direct contact with the Agency. The step-by-step instructions are as follows:

  1. Submitting a request to the bank for cooperation with AHML.
  2. If the answer is positive according to point 1, carefully read the terms of the program.
  3. Preparation of a package of documents requested by the Agency and required by the bank.
  4. Filling out an application on a form issued by the creditor bank.
  5. The reply is in process.
  6. If the answer to clause 5 is positive, a new loan agreement will be signed.

Required documents

If the answer is positive, you must provide a package of documents to the bank. It includes:

  • application form;
  • passports of all family members and copies;
  • Marriage certificate;
  • decision of the guardianship authorities on adoption;
  • Veteran's ID (if available);
  • documents confirming the borrower's disability;
  • certificate of family composition;
  • a copy of the work book;
  • certificate of income (2 – personal income tax);
  • certificate of registration with the employment service.

Every year, banks make mortgage lending more accessible, offering preferential conditions for certain categories of citizens and a simplified procedure for obtaining a loan. However, if your financial situation worsens, a home loan, even on the most favorable terms, can become an insurmountable problem. This is why many banks provide for mortgage restructuring with the help of the state. The program was supposed to end in 2018, but the government extended it in August, read about it below, but now let’s take a look at the essence of the problem.

From this article you will learn:

There is no money to pay off the mortgage: what to do?

If you are unable to repay the loan, you can contact the bank to restructure the debt. What is it and how can you go through this procedure?

Mortgage restructuring is a procedure for re-issuing a loan agreement in order to improve debt repayment conditions for the borrower. If a client has financial difficulties and is unable to regularly make payments in the amount specified in the agreement, the bank will accommodate and offer new lending conditions.

There is another way to solve the problem of repaying a mortgage loan - refinancing. Its goal is to enable the client to repay the debt using funds from another bank. The procedure is as follows: the borrower takes out a loan from another bank at a lower interest rate.

What is more profitable: mortgage restructuring or refinancing? Restructuring is possible only in the bank from which you took out a mortgage on the residential premises, and refinancing can be arranged in any bank that provides this service. The benefit of a particular procedure depends on the individual circumstances of the borrower: the amount of debt, the term of the contract, and credit history.

Consequences of mortgage debt

Late payments will sooner or later lead to the bank demanding payment. It may end up with your mortgage being seized on your apartment. The bank has the right to file a claim for late payments, and you will have to resolve the matter in court. Seizing an apartment for debts is an extreme measure that bank lawyers take. They resort to it, as a rule, only in the following cases:

  • if the borrower ignores calls from the bank and bailiffs;
  • if he does not agree to restructure the loan debt;
  • if he does not repay the debt and does not make any attempts to reach a settlement agreement with the bank.

Losing an apartment due to debt is not the best prospect for a borrower. Therefore, restructuring of mortgage debt is one of the most optimal solutions to resolve the situation.

State-assisted restructuring

Due to the worsening financial crisis in 2015, the state created a restructuring program that allows borrowers who find themselves in a difficult financial situation to write off part of the debt.

In April 2015, a government decree was adopted according to which large families, military veterans, disabled people and guardians of incapacitated minor citizens can participate in the restructuring program. Under this program, borrowers can expect to have their mortgage principal written off. The procedure is handled by the Agency for the Restructuring of Mortgage Loans.

With the borrower assistance program developed by the government, it is possible to write off about 20% of the debt, but not more than 600 thousand rubles. And for large families, the state provides the opportunity to write off an amount of up to 1.5 million rubles.

The restructuring of mortgage debt with state support was valid until May 31, 2017. Writing off part of the debt with the support of the federal budget is currently impossible (at the time of writing), since the law has lost force and the allocated funds to help borrowers have run out.

Latest news: extension of state support

Latest news from August 2017

Based on numerous requests from citizens, the program was extended - Dmitry Medvedev signed a corresponding resolution on August 11, 2017. But in the new edition, the conditions have become significantly stricter; now, in order to become a participant in the program, you must meet the following requirements:

  1. the period between the date of receipt of the mortgage and the date of the application for restructuring must be at least 12 months
  2. The increase in monthly payment was more than 30%
  3. The mortgaged home must be the borrower's only habitable home

To ensure the targeting of allocated assistance, a special interdepartmental commission will be created; its functions, among other things, will include making decisions in providing support to borrowers who, according to certain criteria, do not meet the terms of the program, but are in dire need of state assistance.

The commission also has the right to decide to increase the amount of allocated funds, depending on the circumstances, but not more than double the amount. The standard amount of support is 30% of the balance of the loan amount, but within 1.5 million rubles. As part of the financial support for the program, the government has allocated funds in the amount of 2 billion rubles.

Mortgage restructuring: step-by-step instructions

Despite the fact that the state support program for restructuring a housing mortgage loan has ceased to operate, borrowers may have the opportunity to re-issue the contract on new terms with the bank that issued the housing loan.

Step 1 - Write an application

The main purpose of the application is to notify the bank of the impossibility of paying money on the terms specified in the agreement and to justify its demand for loan restructuring. The application must provide the following information:

  1. Full name and contact details;
  2. Agreement number, date of conclusion, amount, interest rate and other important information specified in the agreement with the bank.
  3. The balance of the debt and the amount paid to the bank.
  4. Reasons why restructuring is necessary. This paragraph should describe in detail the current financial situation and the reasons that led to this.
  5. The terms under which you can repay the loan. You can specify the monthly payment amount that you can currently make towards the loan.

Step 2 - Collecting documents

Documents for restructuring a mortgage depend on the borrower's situation and the reasons why he cannot pay the loan. The standard list of papers for applying for loan restructuring looks like this:

  • Passport.
  • Certificate of income form 2NDFL from the place of work for the last 12 months.
  • Certificate from the labor exchange (upon dismissal from work).
  • Certificate from a medical institution (if the need for loan restructuring is related to illness or disability).
  • A copy of the work book.
  • Receipts for payments made.
  • A copy of the loan agreement.
  • Insurance agreement, guarantee agreement.
  • A copy of the mortgage for the apartment.
  • Other documents proving the impossibility of paying the debt on the original terms.

Additionally, the bank may request a marriage certificate, military ID, and documents confirming the ownership of valuable liquid property.

Step 3 - Submission of application and documents

Where should I go to restructure my mortgage? Contact the bank where the loan was issued. You can submit an application and the necessary documents either in person at a bank branch or via email. Consideration of the application lasts from 1 week to a month, so you should not delay submitting documents, since even more interest may accrue during the processing of the application for late payments.

Conditions for restructuring

Not all borrowers can take advantage of the mortgage loan restructuring program. Most banks provide the opportunity to renew the contract under the following circumstances in the client’s life:

  • dismissal from work due to layoffs;
  • receiving disability;
  • death of a co-borrower;
  • going on maternity leave;
  • the opportunity to take advantage of the restructuring is also provided to large families;
  • other circumstances beyond the control of the borrower that resulted in loss of solvency.

A borrower who remains unemployed due to his own fault (quits of his own free will) is unlikely to be able to take advantage of the restructuring program. In this case, the bank may refuse due to the intentional actions of the borrower, which resulted in a loss of solvency.

In order for the bank to approve the application, it is necessary:

  • documentary evidence of the reasons for the deterioration of the financial situation;
  • no late payments and good credit history.

Please note that the procedure can be carried out no earlier than one year after signing the mortgage loan agreement.

Possible restructuring schemes

To understand more clearly what mortgage loan restructuring is and how it can solve the borrower’s financial problem, you need to understand its possible forms offered by banks. So, what can a borrower who applies for this procedure expect?

  • Extension of the loan term. In this case, the bank reduces the monthly payment amount or interest by increasing the mortgage term. This scheme is good because the borrower can deposit small amounts, gradually repaying the debt. The downside is that the loan term extends over several years, and when the borrower’s solvency is restored, this form of restructuring may be more expensive.
  • Reducing the monthly payment amount for a certain period of time. Typically, when choosing this form, banks allow the client to deposit smaller amounts over a period of 6 to 24 months. The use of this scheme is advisable if the borrower’s financial difficulties are temporary.
  • Grace period for payment of the principal amount. This scheme involves the borrower paying only interest, without paying the principal. Such conditions are possible for a period of six months to a year.
  • Credit holidays on interest payments. The bank provides the opportunity to repay only the principal debt, without interest, within 6-12 months.
  • Individual loan repayment schedule. In this case, the financial institution, based on the client’s situation, draws up individual conditions for the repayment of debt and interest.

The borrower may insist on one of the possible schemes, but the final decision is made by the bank. Also, after reviewing the documents and application, a decision may be made on a combined form of restructuring, which will include several schemes for its implementation.

The advantages of restructuring for individuals are obvious: the borrower retains his living space, a positive credit history is maintained, and the mortgage is paid on more favorable terms. Reviews from borrowers who have undergone the procedure indicate that this is truly the most acceptable way out of the situation. The only caveat: the bank may not approve the application if it considers that the client’s financial situation allows him to repay the debt on the original terms.