The “children's deduction” on mortgages will increase the number of poor people. Reducing the mortgage at the birth of a child Children's housing deduction law when they plan
State program "children housing deduction"was proposed in March 2016 by the United Russia bloc jointly in AHML. This scheme provides benefits and assistance in payment mortgage lending young families who have a child.
The basics of the program were announced by O. Batalina, who is the Deputy Secretary of the General Council, she was supported by many government officials and the scheme is currently in operation. When exactly the child housing allowance will be introduced for young parents, in what amount and to whom it will apply, is not yet completely clear.
The essence of the program to support young families at the birth of a child
The essence of the program is very simple - for those families who have a mortgage, part of it will be written off at the birth of a child. But there are also features that currently act as obstacles to the adoption of the project:
- The proposed draft does not mention anything about those parents who already have children and housing purchased on credit.
- The write-off mechanism has not been worked out, there are no exact amounts and conditions. Certain difficulties are also observed in the source of financing; it is planned that funds will be withdrawn from state budget, but these are trillions of rubles that simply do not exist.
Question about assistance to families with mortgage, is quite sharp. According to studies, this is approximately 3.5 million existing agreements, of which from 17.5 thousand were issued in foreign currency. Due to severe economic situation Many citizens are faced with the fact that they are no longer able to service their obligations to banks. Maternal capital to date does not act as an effective tool to address this issue, although it has helped many families in need improve living conditions.
When will the child housing allowance be introduced? At the moment, it is not possible to name a date, since even the mechanism for implementing the program is not yet clear. In addition, the project reveals social injustice, since write-offs are planned to be made only for families with newborns, and for those who already have children, such benefits are not offered. P. Astakhov proposed introducing a step-by-step write-off system, in which families would be written off 50% of the total interest rate at the birth of 2 children, and 100% at the birth of the 3rd child.
Children's deduction - expert opinion
How realistic is the child housing deduction for a mortgage when children are born? According to I. Safyanova, who is the press secretary of the All-Russian Association foreign currency borrowers, such a project is entirely populist, since the sources of its financing are not clear. Commercial banks are unlikely to contribute to such charity, and there are no free funds in the state budget for this. And the bill itself seems devoid of logic - why will borrowers with children be deprived of benefits, and only those whose babies will be born after the adoption of the law will receive benefits?
Many questions arise regarding how the children's housing deduction will work and for whom it will apply. There are plans that assistance will be provided only to young parents under 30 years of age, but what about the rest, who risk losing their home along with the funds already invested and are unlikely to find a source of income to buy an apartment in the future. That is, with the adoption of the law, a large number of families are still left with the problem of a mortgage alone.
The children's housing deduction program is currently ineffective. Despite the fact that the initiative is supported by many, and the scheme itself carries the most important social function, it has not been worked out. I. Prostakova (head of the mortgage lending department of the ICB) believes that the program is very important; it will help support the real estate market and improve credit discipline, reducing the financial burden on borrowers. But the state cannot simply forgive the entire amount of debt at the expense of banks; it is necessary to find funds from the budget.
A. Aksakov (Chairman of the State Duma for economic issues) believes that the state is ready to provide assistance to citizens who find themselves in difficult situations. But this requires elaboration of the mechanism for allocating funds. For example, the law on a child housing deduction may work similarly to the maternity capital program or require the introduction of a separate budget line allocated for mortgage compensation. The state cannot simply write off debts to banks, but it can allocate certain funds for restructuring. All that is needed is a thorough revision of the project.
Project history
The fact that they want to introduce a children's housing deduction in Russia became known at the end of March 2016. The United Russia bloc stated that support for young families with mortgages is needed, for which it proposed introducing a bill on the possibility of writing off part of the loan. But even after a couple of months, work on the project has not progressed far, since it is not even clear which categories will fall under the preferences and to what extent they will be able to use them. The main disadvantage, according to D. Monastyrshin (chief analyst of Promsvyazbank), is the already laid down social inequality. The draft stipulates that only those who had babies after the adoption of the law will be able to receive preferences. At the same time, the program will not affect those borrowers who already have children; they simply find themselves left out of state assistance and left to fend for themselves.
Will a child housing allowance be introduced in 2016? It is very difficult to answer positively at the moment due to the incompleteness of the project, the lack of a compensation and financing mechanism. It is not even clear who will be able to take advantage of the benefits after the law is adopted. The proposed write-off option only for young families or parents whose babies were born after the project came into force causes social inequality. Will the bill work in the future? It is too early to judge now, since the document is being finalized and there is no exact date for its presentation.
Concerned about increasing the population, the Russian authorities regularly initiate the adoption of various programs. And if everyone knows about maternity capital, then measures such as mortgage benefits at the birth of a child are not so popular. There are new projects that are still under development.
Let's figure out what kind of help the state is ready to provide. How is the reduction made? interest rate on a mortgage at the birth of a child.
General description and purpose of benefits
The state is interested in population growth. This is his wealth. IN modern conditions young families are limited to one or two children.
Having carefully examined the problem, we found out that there is only one limiting factor: housing issue. Buying an apartment is expensive. Apply for a loan - there is not enough money for children.
Therefore, the government has developed a system of measures to provide families with benefits upon the birth of a child on an existing mortgage.
Benefits are provided exclusively to citizens of the Russian Federation.
The loan is written off partially or completely. This depends on the number of children in the family, the age of the parents, the characteristics of the region, and the cost of housing.
Repayment of part of the mortgage within the framework of an existing project
The program “Affordable Housing for Young Families” has been running since 2011.
Families who decide to take out a mortgage loan have the opportunity to slightly reduce its amount.
There are certain conditions that potential participants in the program must meet.
Namely:
- the applicant's age is limited to 35 years (one of the parents);
- the area of the apartment should not be more accounting norm, established by the region per person. The average values are as follows: for a person living alone - 33 sq.m., for two people - 42 sq.m., for each subsequent family member 18 sq.m. These standards determine the family's need for improved housing conditions;
- family solvency. Your gross income must be sufficient to pay your monthly mortgage payments.
The state covers the family's housing costs only partially. The program provides a cash subsidy that covers the cost of housing by 30-35%.
Young people can apply for a loan and take advantage of the benefits after becoming eligible for a subsidy or repay part of the principal debt on an existing mortgage.
Where to contact
Mortgage forgiveness does not automatically occur upon the birth of a child. It is necessary to go to the district administration with the package of documents listed below. There they will check your papers and ask you to fill out an application form.
You should have with you:
- passports (mom and dad or one if the family is single-parent);
- birth certificate of the baby (all children);
- Marriage certificate;
- documents confirming the need for improved housing conditions;
- document on home ownership;
- income documents.
Make copies of all documents. For passports, in addition to the first page, you should also photocopy the registration page. Review of the application will take some time.
The bank writes off the mortgage only after a positive decision has been made by the administration and a subsidy certificate has been issued. If your family has financial difficulties, you can take advantage of another benefit during this time.
Program conditions vary by region. Details should be checked with local authorities.
Features of debt write-off at the birth of a second baby
The program under which a family receives maternity capital has been extended until 2022.
This means that they can cover the mortgage when a second or subsequent child appears in the family. At the same time, the loan write-off benefits mentioned above do not intersect in any way with the use of maternal money.
That is, people can take advantage of both types of benefits and invest them in their apartment. This allows you to reduce your debt to the bank.
Maternity capital can be used to pay off any mortgage, not just taken out under the state program.
Paying off the mortgage at the birth of your third child
Some families are eligible to receive Money, in addition to those mentioned above. They receive this right upon the birth of their third or subsequent child. To do this, you need to contact the bank branch where you took out the mortgage loan.
The mortgage upon the birth of a third child is written off upon presentation of the following documents:
- application for mortgage repayment;
- children's birth certificates;
- marriage certificates;
- loan agreement;
- document confirming the ownership of real estate purchased with a loan.
Copies are provided to the bank branch; the originals should be brought with you at the reception. After checking the documents by the DOM.rf organization, the money will go to the bank. Some or all of the principal will be written off.
It does not matter when the loan was taken and for the purchase of what kind of real estate, what the debt balance is and the age of the borrowers. The main condition is the birth of a third or subsequent child after 01/01/2019.
Deferred payments in 2020 - benefits from the bank
Some financial institutions are accommodating to young families. They provide a deferment on the principal mortgage payment when children appear.
This benefit is called “Mortgage holiday”.
According to federal law, the borrower has the right to ask to temporarily suspend mortgage payments or reduce their amount for up to 6 months. It is important that the situation in which the borrower finds himself complies with those set out in the law:
- obtaining unemployed status;
- receipt of disability of 1 or 2 groups;
- being on sick leave for more than 2 months (this includes sick leave for pregnancy and childbirth);
- loss of more than 30% of regular income, with mortgage payments taking up more than half of current income;
- maintaining more dependents than when incarcerated loan agreement, a loss of more than 20% of income, while the mortgage payment takes away more than 40% of current income.
To apply for a benefit, you must write to financial institution statement. Copies of documents confirming benefits are attached to it.
Mortgage interest rate reduction
Families in which a second or subsequent child was born after 01/01/2018 may qualify for a reduction in the mortgage rate to 6%. This happens with the help of state support. Some banks go further - they reduce the rate to 4.5-5% on their own.
In addition to the date of birth of the child, one of the main conditions is the type of purchased real estate. State assistance applies only to the primary housing market. Those. the property must be purchased directly from the developer or under contract equity participation in housing construction.
With current mortgage rates starting from 9%, this measure is very profitable; the mortgage payment is significantly reduced.
Regional programs
In addition to all the above methods of reducing a family’s credit burden, regions can develop their own measures to support families with children.
One of these measures includes regional capital. This sums of money, which issue local authorities at the birth of a second or third child. As a rule, they can pay off part of the mortgage debt or use it for other needs. Amounts regional capital not as large as in the federal version of maternity capital, but are a nice bonus.
In the Far East, mortgage rates of up to 2% are provided for families with children. This is significantly lower than throughout the rest of the country. The program is designed to attract people to the region.
Your state may have other programs. Check the conditions for participation in them with the administration or the MFC.
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Mortgage write-off at the birth of a child
January 28, 2017, 23:03 Dec 25, 2019 00:20
Experts: the children's housing deduction scheme should suit all market participants 3 The State Duma Committee on Social Policy proposed introducing the “Children's Housing Deduction” - a program according to which part of the mortgage loan of young parents in the event of the birth of a child will be paid from budget funds. How such a measure will affect the real estate market and whether, thanks to it, residential projects will become more focused on families with children - experts told the UrbanLook portal about this.
Dmitry Mikhalev, head of the service for working with government agencies at St. Petersburg Renovation:
A child housing allowance would be a useful measure to support young families. Today, many are cautious about long-term credit products, because they are not confident in the stability of their income. Writing off part of the debt at the birth of a child would motivate people to purchase housing without putting an excessive burden on family budget. In addition, such a deduction could support developers, as it would increase the demand for multi-room housing. This would make it possible to make many residential complexes aimed at mass buyers more balanced in terms of apartment geography by increasing the share of two- and three-room apartments. Only two questions remain. The first is the amount of the children's housing deduction. Most likely, it will vary depending on the number of children in the family: the more there are, the higher the deduction. And the second question is whether its introduction will mean the abolition of maternity capital. Today, matkapital can also be used to service a mortgage loan, and it is unlikely the government will go to finance two similar instruments at once.
Evgenia Vladimirova, head of the Rambler.Real Estate project Rambler&Co:
The initiative to forgive part of the mortgage debt to young parents is interesting, but it is important to understand whether this idea is populist. Perhaps it would be wiser to extend and expand the program for providing maternity capital, since up to 90% of this government payment is used by families to improve their living conditions. In addition, a completely logical question arises: why it was decided to support only mortgage holders, and not all young parents. The proposal has been made, but the details of the possible social program, sources of its financing. Of course, supporting families at the birth of children and helping to improve living conditions are important areas in the state’s social policy. Developers also benefit from the launch of such programs; many projects will further develop social infrastructure, this will become an additional competitive advantage for residential complexes. Russians need such programs and the construction industry needs them.
Vasily Sharapov, lawyer at the development company City-XXI Century:
Any reasonably regulated assistance from the state to young families can only be welcomed. But for the stable functioning of the market mortgage loans We need rules that suit all participants in this market. Forgiving part of the debt means a loss for the creditor. If mortgage loans are unprofitable, simply no one will issue them, and therefore no one will receive them. At one time, so-called maternity capital appeared in the legislation, at the expense of which the child’s mother has the right to repay part of the mortgage loan. Any new duplicating mechanisms like the “children’s housing deduction” are hardly needed. The state can also use a mechanism to subsidize mortgage loans, which is already being used in some banks during the crisis.
You can simply increase the amount of maternity capital, which the mother has the right to direct to mortgage payments. However, such a measure, as we understand, can significantly increase costs federal budget. I would also emphasize that families with children pay taxes almost the same as those people who do not have children. Maybe think in this direction and reduce taxes for families with two or more children. This would be useful and, in my opinion, fair. Taking care of a child is kind of our social tax, our duty to future generations. The money that parents save on taxes, they can invest in their children, for example, in their education and development.
Kristina Shulgina, head of the mortgage department at NDV-Real Estate:
The introduction of such a mechanism seems realistic, especially since the state provides social support: there is a maternity capital program, military mortgage. However, not everything is simple: you need to develop a mechanism “from scratch”, think through the algorithm and interaction processes, as was the case, for example, with maternity capital. Banks are not commercially interested in forgiving mortgage debts, so the implementation of such a measure seems possible with the direct participation of the state. If a mechanism for debt compensation is determined, then the program for this deduction may well work successfully. The measure itself, if implemented, could have a positive impact on the real estate market, especially since family people often become apartment buyers. However, the strength of this effect will depend on the terms of the program and the audience of borrowers it covers. Given the fairly stringent restrictions and requirements that program participants will have to meet, the impact on the market will be very narrow. For now, these issues are most likely at the initial stage of discussion. Changes in real estate formats are unlikely to be expected. New buildings offer the desired level of comfort for both families with and without children. In addition, there are already projects on the market that are conceptually oriented specifically towards family buyers.
Vadim Lamin, managing partner of the SPENCER ESTATE real estate agency:
The initiative is undoubtedly interesting. In my opinion, to spur the birth rate of Russians, all means are good, because it is no secret how the population growth in Russia is formed. There is also no doubt that developers are now en masse adding to the format of small apartments and studios designed for 1-2 residents. The reason is simple - it is in demand mainly because it is cheap. It is these factors that lead to the fact that this format is fashionable and modern. Although, living in a spacious apartment, within reasonable limits, of course, is much more comfortable. And it’s more profitable for the developer to build large apartments. However, demand determines supply. Everything follows from financial opportunities population, which is undoubtedly now declining. Under these conditions, even small movements, to which the one under consideration can be attributed, will have positive value, although, in my opinion, they will not bring fundamental solutions to the real estate market.
Raisa Manashirova, commercial director of SDI Group, developer of the Accord residential complex project. Smart-quarter":
Such a measure, if adopted at the legal level, could have a very positive impact not only on the real estate market, but also on the improvement demographic situation. Firstly, this will affect the quality of life of young families who will have a real chance to acquire their own housing, and as a result, the entire construction industry, which has been last year supported through government subsidies of mortgage rates.
Maria Litinetskaya, managing partner of Metrium Group:
Any stimulation of effective demand has a positive effect on the market. This is not an unfounded statement, since government subsidies for mortgages are clear evidence of this. Without this tool, the market would have frozen a few years ago. When a child appears in a young family, it becomes extremely difficult for one able-bodied person to independently make loan payments. And such government support will be very timely in the current economic conditions. Therefore, additional subsidies for mortgages for young families will definitely support demand and, accordingly, the market. If developers decide to change existing housing formats, this will not happen in the next 2-3 years, since the real estate market is developing gradually. In my opinion, the share of two-room apartments or similar “Euro-format” proposals may increase, since young families with at least one child will find it uncomfortable to live in small studios or one-room apartments.
Olga Shikhova, head of the Mortgage and Loans Department at the Bon Ton real estate agency:
The idea is to introduce a reduction mechanism mortgage debt at the birth of children, in fact, is another mechanism to stimulate an increase in the birth rate in the country and the availability of mortgages. Maternity capital, which is indexed every year (except for 2016), has partially taken on this role. It can also be used to pay off a debt to the bank, but it is given only once at the birth of a second or subsequent child in the period from 01/01/2007 to 12/31/2018. If a scheme is developed under which repayment will occur at the birth of each child in the family during the mortgage repayment period, then this will undoubtedly be a good help for young parents.
The main thing that this program was able to work together with others (matkapital, tax deduction), rather than replacing them. As for developers, this measure will not force them to reconsider existing formats. After all, both the cost of construction and the rate of payback of the project are taken into account. Apartments of small areas are sold faster today, since they cost the buyer less, but at the same time have a higher cost per square meter, compared to 3-4-room apartments. At the moment, in all projects the range of apartments is varied and any family will be able to choose a suitable property for themselves.
Tatyana Guseva, director of the MIEL-Novostroiki mortgage center:
At the moment, these proposals are in the discussion phase, while there are no concrete decisions. However, the idea is good and interesting, since any measures to support citizens, and especially families with children, have a positive effect on both sales volumes and construction volumes, respectively, and even more so such a measure as subsidizing part of the debt. At the same time, there is one tangible “but” - in order to receive a “children’s housing deduction” you must first take out a loan, and this is directly related to the solvency of the population. But the real incomes of citizens are still declining.
Dmitry Panteleimonov, Director of the Marketing and Sales Department of Leader Group, Moscow Region:
Today, most large-scale residential complexes in the Moscow region are already aimed at family buyers with children. On the territory of large microdistricts, developers are building kindergartens and schools, placing playgrounds and sports grounds in the courtyards of houses, improving walking areas, etc. So, additional infrastructure facilities are unlikely to be needed. In addition, the expansion of infrastructure will increase the cost of construction and, as a consequence, prices for apartments. Another thing is that “child-centricity” will certainly be used in one form or another in advertising and promotion of objects.
Konstantin Shibetsky, director of the mortgage department of the MIC Group of Companies:
If the State Duma passes the bill on a children's housing deduction, this will give some increase in the volume of mortgage loans to families with children, since such a measure will increase the purchasing power of this category of citizens. However, we cannot yet predict exactly to what extent. As for the reaction of developers to this measure, its format will directly depend on the mechanism for implementing the legislative initiative, as was the case with state subsidies for mortgages. The only difference is that the process may take longer. With the state subsidy, the mechanism became clear quite quickly, since it did not depend on the factor of childbirth. On average, the process may take 2-3 years - during this period developers will be able to evaluate sales statistics for this category of clients, and if their volume increases significantly after the adoption of the bill, then there will definitely be a reaction. Developers will be able to plan the following projects with a qualitatively different layout ratio, designed for families with children. In any case, this initiative implies significant support for both family citizens and the construction industry as a whole, especially since there are similar bills in the West, and they are successfully functioning in the real estate market.
Lyudmila Tsvetkova, financial director"MIEL-Country Real Estate":
It is too early to talk about the impact of such an initiative on the market, since the exact scheme and volume of the deduction are not yet known. According to the government representative, it is clear that it is not one-time (like maternity capital), but it is not clear how many times the deduction can be used and whether it will be linked to the number of children. In my personal opinion, it is difficult for young families to save for an initial fee on a mortgage, without which they cannot use the loan. Therefore, I think it is important to think through mechanisms that will help either save up for a down payment on a mortgage, or use public funds for this (similar to maternity capital, which can now be used as a down payment). But the very idea of helping young parents pay off their mortgage is certainly correct. Perhaps, in the future, this could become the engine with which consumers themselves will be able to influence commercial structures (developers) in order to increase their “child-centricity.”
Vartan Poghosyan, Marketing Director of TEKTA GROUP:
It is not yet possible to draw a conclusion about the degree of influence of this measure on the real estate market, since specific proposals and mechanisms have not yet been presented. In principle, similar functions are already performed by maternity capital. Of course, an additional mechanism would not hurt, but a lot of questions immediately arise here - from the fairness of such a measure to the size of the amounts written off. It is worth noting that buyers with families and children are by far the most active. This is largely because the birth of a child becomes a powerful incentive to buy your own home.
And accordingly, the larger the family becomes, the more space it needs to live. In principle, in most projects the issue of creating this kind of infrastructure is paramount and mandatory. Therefore, we can say that almost any object on the market is “child-centric.” Another question is that a reasonable approach involves creating not only children's infrastructure, but also other facilities necessary for life. Firstly, in addition to children, there are other categories of citizens who need special treatment. And secondly and most importantly, good project should be oriented to a long cycle. That is, take into account that today children need kindergarten, tomorrow they will grow up - and they will need a school, and the day after tomorrow - a workplace, a hospital, a cinema, shops, etc. In any case, this measure will be very useful as it stimulates an increase in the birth rate.
Nikita Zhuravlev, Chairman of the Board of the Association of Real Estate Market Professionals REPA:
The proposal of deputies to introduce a “children’s housing deduction” gives us hope for a promising future for our children. However, this is not enough to stimulate the primary real estate market. Interest rates on a mortgage loan for a person’s first and only home should not exceed 5-7% in order to eliminate possible speculation in the market, and the down payment should be from 10%. And all these preferences should not depend on age and apply only to young families. In addition, at the state level, it is important to work out the issues of constructing rental housing and offer it to citizens as an alternative to the complex, lengthy and expensive process of purchasing a home. A statement of intent is, of course, good, but concrete actions are important.
Irina Ignatieva, Marketing Director of ComStrin:
We live in difficult times. Yes, effective demand for real estate is falling. Yes, it needs to be supported. But, probably, in other ways - by reducing mortgage rate for all categories of citizens, reducing administrative barriers for small and medium-sized businesses, creating new jobs, and so on. Writing off part of the mortgage debt for young parents will, of course, help, and primarily the regions. Now people there take out a mortgage reluctantly and with difficulty. More affordable mortgages will certainly stimulate demand for real estate. But this support measure will have a quick short-term effect, like a headache pill. Whether the “children’s housing deduction” will cure our economy and increase the well-being of our citizens in the long term are probably rhetorical questions. In order for residential projects to become more child-centric, support is needed for the construction of social facilities - kindergartens, schools and clinics. Today, these objects account for 10 to 20% of the cost per square meter.
Alexey Perlin, CEO"SMU-6 Invest":
In modern conditions and economic realities, developers are focused more on families with children. Thus, in the business-class housing segment, the share of family buyers is about 50%. The number of mortgage buyers who want to improve their living conditions and are planning to increase their family is today about 60%. The initiative that came from AHML to pay compensation (or provide benefits) to those families in which a child was born already in the process of paying off the mortgage loan is good, but it still leaves more questions than it answers. In particular, it is not clear how the amount of compensation will be calculated: the period will decrease, the absolute amount or % of total debt. How will the 2-3 and subsequent children who appear during the mortgage process be counted? That is, there are no obvious answers yet.
Anna Borisova, head of the mortgage lending department of the KASKAD Family of companies:
Indeed, this State Duma committee proposes to introduce a measure called “Children’s housing deduction.” This is due to the fact that there is a big state problem in which there are no more than seven square meters, which leads to an urgent need for improved living conditions. If this measure comes into effect, first of all, it will improve the situation in those families who are expecting the birth of a child, since in the case of an existing mortgage, the loan burden will decrease, which will allow the family to reduce the amount of expenses as a whole. This measure will also affect the volume of mortgage transactions not only in the primary, but also in secondary market housing, increasing the overall share of such transactions by at least 30% approximately a year after entry into force, due to the fact that pent-up demand will be stimulated.
Natalya Smirnova, Deputy Director of the Sales Department of the Granel Group of Companies for mortgage lending:
At the moment, not all developers can boast of a well-thought-out infrastructure within their projects. However, in general, in the primary housing market there is a tendency to improve the quality of construction; many developers are trying to adapt to the new requirements of the time and build infrastructure facilities that are necessary primarily for family clients with children. The “Children's Housing Deduction” program, along with the maternity capital program, will partly contribute to the continuation of this trend and the emergence of new high-quality properties aimed primarily at families with children.
From 2019 conditions preferential mortgage for families with children have changed. Now reduced rate 6% is valid for the entire term of the mortgage and applies to families in which the second, third, fourth and subsequent children were born until 2022. Previously, the period of the preferential rate - three, five or eight years - was influenced by the child's priority.
The benefit can be obtained on a new or existing mortgage.
Also in April of this year, another important change appeared: if you took out a loan according to the “old rules” for a short-term reduction, you can apply again and reduce the rate until the end of the mortgage term.
The state program is aimed not only at stimulating the birth rate and supporting families with children, but also at supporting the construction industry, because only loans for primary housing are subsidized.
Government Decree No. 1711 of 12/30/17Government Decree No. 339 of 03/28/19
The age of parents who want to participate in the program does not matter. The main thing is that the borrower’s age is from 21 to 65 years.
“A decision was made to adjust the program for subsidizing mortgage interest rates for families with children. If previously the rate was subsidized only for eight years - three years for the first child, five years for the second - a total of eight years, now these restrictions have been lifted on behalf of the president, and a 6 percent mortgage will be subsidized for the entire period of the loan,” said the Minister of Labor and Social Protection Maxim Topilin.
Who do they give it to?
The program has a number of conditions under which you can use it:
- the child must have been born between January 1, 2018 and December 31, 2022;
- a down payment of 20% of the cost of housing is required, for example, you can use maternity capital;
- Both the mother and the father of the second and (or) subsequent children can take advantage of the subsidy. The loan agreement may include additional borrowers (citizens of the Russian Federation), who may be without children;
- Only citizens of the Russian Federation can participate in the program;
- employees must have worked at their last place of work for at least 6 months, individual entrepreneurs must operate without losses for at least 2 years;
- The loan must be repaid in equal installments.
Conditions
Interest rate reductions work in all regions under certain conditions:
- the apartment must be purchased on the primary market; subsidies do not apply to the secondary market;
- housing should cost no more than the established limits. For Moscow, St. Petersburg and their regions the limit is 12 million rubles, for other regions - 6 million rubles.
- After registration of ownership of the apartment, you need to conclude an agreement personal insurance and apartment insurance.
You can buy an apartment either ready-made or at the stage shared construction. There are no restrictions on the number of apartments for which a mortgage will be issued. If the bank decides that the family can handle the load and can repay loans for several apartments, then they will be issued. The state transfers the right to banks to resolve such issues.
Maternity capital is included in the mortgage limit
A family cannot take out a mortgage higher than the established amount of 12 million for large cities and 6 million for all others. But starting this year, the limits will be lower for those families who received maternity capital: it was included in the loan limit.
That is, if residents of Tula are going to invest maternal capital in the down payment, they will be approved for a preferential mortgage of a maximum of 5,500,000 rubles.
New conditions for obtaining refinancing
There are a number of conditions for refinancing:
- the loan must have been repaid for at least 6 months;
- no late payments;
- The family did not pursue other refinancing options.
If the child was born in 2017 or earlier, then the family does not have the right for preferential mortgage subsidies.
How to get government support
To receive preferential subsidies, you need to contact the bank where the mortgage was issued, or apply for a mortgage according to the standard scheme and attach the relevant documents for preferential lending.
If the family is already paying off the mortgage, it is enough to bring the birth certificate of the children, both the first and subsequent ones, and write an application for benefits. In this case, the bank will restructure the remaining payment.
If you are just applying for a mortgage, you must provide a standard set of documents to obtain a loan:
- loan application;
- passport and its copy;
- a copy of the work book;
- income certificate in form 2-NDFL;
- for individual entrepreneurs certificate of state registration and tax return;
- birth certificates of all children;
- purchase and sale agreement or agreement for participation in shared construction.
Depending on the bank, you may need some additional documents, which employees request.
The birth of a second and (or) subsequent children does not automatically give you the right to receive a preferential “children’s” mortgage. Each bank will assess the solvency of an individual family and take into account its risks. Therefore, if a loan is denied at one bank, you can turn to another.
For the Far East 5 percent
If a family is going to buy housing in the Far Eastern region, it is entitled to additional benefits:
- You can buy an apartment or house on the secondary market, provided that the housing is located in a rural area.
- If the child was born from January 1, 2019 to December 31, 2022, and mortgage agreement concluded after March 1, 2019, preferential rate of 5%.
Which banks refinance
The loan is issued by Russian commercial banks or the DOM.RF society. A preferential rate can be obtained from those banks that have applied for participation in the program. The application will be approved by those banks that meet the state requirements.
The full list of participating banks was approved by order of the Ministry of Finance.
- "Sberbank of Russia";
- VTB Bank;
- "Absolut Bank";
- bank "ROSSIYSKY CAPITAL";
- Gazprombank;
- JSC Russian Agricultural Bank;
- Promsvyazbank;
- Otkritie Financial Corporation Bank;
- "CREDIT BANK OF MOSCOW";
- Raiffeisenbank.
Housing on the secondary market
Secondary housing does not fall under the preferential mortgage program at 6 percent. Even if the family already had a mortgage loan for secondary housing and after January 1, 2018, their second and (or) subsequent children were born, the loan will also not be refinanced.
Tax deductions under the new loan program
The financing program in excess of 6% per annum does not cancel property tax deductions for apartments. If you have taken out a primary mortgage, you can return part of the money in the usual manner. If a family wants to refinance a previously taken out mortgage loan, it is better to contact only approved banks.
Mortgage for families with disabled children
In November 2019, Russian Prime Minister Medvedev signed a decree according to which families with disabled children can take out mortgages at a preferential rate.
Conditions for obtaining a mortgage: the child must be born no later than 2022. If disability is established after this period, the family will be able to obtain a mortgage on preferential terms until the end of 2027.
Since the beginning of 2020, a number of changes have come into effect in the field of social payments. Most of them have become targeted and are intended for low-income families whose average per capita income is below the minimum wage. At the same time, the Minister of Labor and social protection M. Topilin announced that the state will strive to increase the minimum wage and at the same time reduce the amount of benefits paid. As he stated: “It’s better that people have higher wages.”
28.12.2020 President V.V. Putin signed new law on payments to families with children, which came into force on January 1, 2020. According to this law, now families in which both first and second children are born can receive monthly allowance for caring for a baby up to 1.5 years old. At the same time, money for the first can be received through social security, and money for the second through Pension Fund, since they will be paid from maternity capital funds. Families whose average per capita income is below 1.5 times the amount can apply for payments living wage in the region.
Child tax credit in 2020
The term single parent is interpreted very vaguely. In judicial practice, this status is given to a person who cares for a child alone without receiving financial assistance from the other parent due to his death, serious illness, disappearance, etc.
The tax deduction for children is made individually for each family. Let's consider this situation: an employee has two children who have not reached the age of majority, and his income is 35 thousand rubles per month. As a result of a simple analysis, we find that the total deduction for children will be 2800 rubles (1400 rubles for each child). This amount is taken into account until November, since in the mentioned month the total income of a citizen will exceed 350 thousand rubles per year. In the period from January to November, the accounting department will carry out tax deductions from the amount of 32.2 thousand rubles (35000-2800=32200) in the amount of 13%. Simply put, taxes are withheld not from 35 thousand, but from 32.2 thousand rubles:
Tax deduction when buying an apartment in 2020
The rules for using tax deductions that exist as of 2020 are applicable to those citizens who have purchased real estate since 2014. At the same time, the main innovation of 2020 is new way confirmation of ownership of the property. If previously it was enough to present only a certificate of ownership, then from the second half of 2020 it is required to provide the competent official with an extract from the Unified State Register. The legal basis for such changes was Federal Law No. 360 of July 3, 2020.
Purchasing a home in most cases entails the most significant expenses in a family’s life and, accordingly, disrupts its financial stability for some time. An important function of a socially oriented state is to support citizens during periods of their greatest vulnerability. One of the forms of support is still a tax deduction for the purchase of an apartment - 2020 did not bring any significant innovations to the conditions and procedure for providing benefits.
Everything about the children's housing deduction program: when it will be introduced, for whom it is valid, the essence of the program
When will the child housing allowance be introduced? At the moment, it is not possible to name a date, since even the mechanism for implementing the program is not yet clear. In addition, the project reveals social injustice, since write-offs are planned to be made only for families with newborns, and for those who already have children, such benefits are not offered. P. Astakhov proposed introducing a step-by-step write-off system, in which families would be written off 50% of the total interest rate at the birth of 2 children, and 100% at the birth of the 3rd child.
Standard tax deduction for children: who can receive it, its size in 2020, how to apply
You must stop using the deduction starting from the month following the month you stop studying. True, in a situation with education there is an exception - if the child gets married. In addition, the deduction is accrued not only for the natural child, but also for those adopted or in care.
- Application for tax deduction for a child. It is registered in the accounting department in the name of the director;
- A copy of the document that confirms the right to receive a deduction (a copy of the child’s certificate or adoption certificate);
- Marriage document (copy of certificate, copy of page from passport with stamp);
- If a deduction is requested for a disabled child - a corresponding certificate;
- If the child is studying full-time, a certificate from the university. The Ministry of Finance has determined that the geographical location of the institution does not matter - the child can receive education both in Russia and abroad. In addition, a deduction is provided when studying on a paid basis.
Everything about the children's housing deduction program 2020: when it will be introduced, for whom it is valid, the essence of the program
The issue of assistance to families with a mortgage loan is quite acute. According to research, this is approximately 3.5 million valid contracts, of which 17.5 thousand are issued in foreign currency. Due to the difficult economic situation, many citizens are faced with the fact that they are no longer able to service their obligations to banks. Maternity capital today does not act as an effective tool for solving this issue, although it has helped many families in need to improve their living conditions.
The fact that they want to introduce a children's housing deduction in Russia became known at the end of March 2020. The United Russia bloc said that support for young families with mortgages is needed, for which it proposed introducing a bill on the possibility of writing off part of the loan. But even after a couple of months, work on the project has not progressed far, since it is not even clear which categories will fall under the preferences and to what extent they will be able to use them. The main disadvantage, according to D. Monastyrshin (chief analyst of Promsvyazbank), is the already established social inequality. The draft stipulates that only those who had babies after the adoption of the law will be able to receive preferences. At the same time, the program will not affect those borrowers who already have children; they simply find themselves left out of state assistance and left to fend for themselves.
Children's personal income tax deductions in 2020: sizes
By general rule deductions for children in 2020 are provided monthly throughout tax period(2020) until the total salary is 350,000 rubles. Such frequency and limit are established by tax law(Article 218 of the Tax Code of the Russian Federation). The restrictions apply until the start of the new (2020) year.
Individual employees in an organization or individual entrepreneur have the right to claim some relief in terms of the tax burden - standard children's deductions for personal income tax. In 2020, they must be taken into account when calculating income tax. What are the amounts of deductions for children in 2020? Which limit value these deductions? How to calculate them? What documents should I request from an employee with children?
Standard deductions for a child in 2020: sizes, limits
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- the employee is registered according to employment contract or under a GPC agreement
- the employee is registered at the main place of work or is an external part-time worker
- the employee is tax resident RF
- employee has a child
- the employee submitted an application for a child benefit
Tax deductions in 2020
- the deduction is provided both for the treatment of the taxpayer himself and for his spouse, parents and children;
- the total deduction for regular treatment should not exceed 120,000 rubles per year;
- for expensive treatment, you can receive a deduction for the full amount of costs;
- at medical institution who provided the services must have a properly issued license.
In the first case, income individual reduced by 3,000 rubles per month (disabled people of the Great Patriotic War, liquidators of the consequences of nuclear accidents and others) and by 500 rubles (Heroes of the USSR and Russia, holders of all degrees of the Order of Glory, minors with childhood disabilities and others).
Tax deductions for families with children in 2020
As in 2015, deductions for children in 2020, over 18 years of age (although this sounds somewhat strange), but under 24 years of age will be provided if the boy or girl is a full-time student. This also applies to graduate school, residency and other forms of training. If the training is completed, but the 24th birthday has not yet arrived, then the provision of the deduction stops in the month following the one in which the training ended.
These categories of Russians include families with children. The state supports the birth rate through various federal and regional programs, for example, Maternity (family) capital or lump sum payments upon the birth of a child. Of course, all this is very supportive of families with children. But there is one more benefit that is often forgotten by both taxpayers themselves and their employers. This is the child tax credit.