of June 19, 2003 No. 979-IV
About mortgage lending, transactions with the consolidated mortgage debt and hypothecation certificates
This Law establishes the relations in system of mortgage lending, and also transformation of payments on mortgage assets in payments for hypothecation certificates using controling mechanisms property.
In this Law terms are used in the following value:
management of mortgage assets (further - asset management) the civil relations when implementing legal and actual acts concerning the order payments on mortgage assets on its own behalf, for the account and for the benefit of ustanovitel of property management;
the hypothecation certificate (further - the certificate) - the mortgage security, provided with mortgage assets or mortgages;
the agreement on mortgage debt - the civil transaction directed to acquisition, change or the termination of the civil laws and obligations arising at the loan provider and the debtor concerning mortgage debt;
mortgage debt - primary obligation according to any transaction which accomplishment is provided with mortgage;
mortgage lending - the legal relationship arising concerning acquisition of right of the requirement of mortgage debt for transactions and other documents;
mortgage pool - the consolidation of mortgages according to mortgage agreements providing accomplishment of the primary obligations reformed in the consolidated mortgage debt;
mortgage assets - reformed in the consolidated mortgage debt of agreement obligation about mortgage loan to make payments on account of repayment of primary obligation during circulation period of certificates. Mortgage assets have the cost, the acquisition price (the obligation price) and existence term;
the managing director of mortgage - the bank performing servicing of mortgage assets;
the consolidated mortgage debt - the agreement obligations about mortgage loan reformed by the loan provider;
the manager - financial institution which is effective on its own behalf, exercising control of mortgage assets for the benefit of ustanovitel of management of mortgage assets and has the corresponding permission / license;
ustanovitel - the owner of mortgage assets which it transfers to the control to the manager;
shares of mortgage assets - obligations under separate agreements on mortgage loan which enter the consolidated mortgage debt.
The mortgage debt arises from the civil relations between agreement parties about mortgage debt on condition of observance of the requirements established by this Law. The main economic and legal requirements of emergence of mortgage debt shall be opened to the conclusion of the agreement on mortgage debt. This information shall be promulgated by the loan provider in writing and contain:
the inventory of all money dues and expenses connected with establishment of mortgage;
the principles of determination of payment under the agreement on mortgage debt;
regulations on inflation caution;
procedure for early accomplishment of primary obligation in case of insolvency of the debtor or failure to carry out by the debtor of the agreement obligations about mortgage debt and legal consequences of this failure to carry out;
the right of the debtor to warn the loan provider about possible failure to carry out of primary obligation;
details of the license and/or certificate on entering of the loan provider into the State register of financial institutions or State register of banks;
other conditions on the decision of the loan provider.
Terms of the contract about mortgage debt and the mortgage agreement are developed by the loan provider.
The loan provider can enter procedures for establishment of solvency and identification of the debtor.
In the agreement on mortgage debt can be specified:
the cost of primary obligation, terms and the amount of payments taking into account inflation caution or condition allowing them to determine;
the consent of the debtor to accession of its primary obligation to the consolidated mortgage debt and inclusion of mortgage in mortgage pool;
the right of the loan provider to alienate primary obligation or the right of receipt of payments under the agreement on mortgage debt;
conditions of financial risks insurance relatively:
- failures to carry out of primary obligation;
- non receipt of payments under this agreement;
- untimely realization of subject of mortgage;
- untimely receipt of the sum realized from realization of subject of mortgage, or its insufficient size for satisfaction of requirements of the creditor.
Terms of the contract about the mortgage debt included in the consolidated mortgage debt, are not subject to changes.
In case of determination in the agreement on mortgage debt of cost of primary obligation such obligation shall include the price of the obligation and the income of the loan provider. At the price of the obligation in this case the amount of means provided by the loan provider to the debtor is.
Primary obligation under such agreement on mortgage debt is subject to gradual reduction of its cost as a result of introduction of payments under the agreement on mortgage debt. The price of primary obligation decreases by the amount of such payments which the loan provider credited on debt repayment of the debtor at the obligation price.
Inflation caution is the method of preserving actual cost of monetary claims and the income of the loan provider caused by agreement parties about mortgage debt. Such caution shall provide indexation of payments under the agreement on mortgage debt in case of payment of primary obligation.
In inflation caution and for accounting of obligations of debtors under agreements on mortgage debt the indexing conditional units of account or other mechanisms which use is not forbidden by this Law can be used.
The mortgage arises according to this Law and the Law of Ukraine "About mortgage" rather real estate, objects of construction in progress and property rights on the real estate which construction is not complete.
Assessment of subject of mortgage is performed by agreement of the parties if other is not provided by the mortgage agreement.
The loan provider can independently perform functions of the mortgage holder or charge accomplishment of these functions to other person.
The mortgage agreement shall be signed in writing and notarially certified. The notarial certificate of the mortgage agreement is carried out on the location of the real estate (place of registration) which is mortgage subject or on the location of the mortgage holder (place of registration) or ipotekodatel.
The mortgage agreement, mortgage subject of which is the real estate which belongs to the third parties and will become property of ipotekodatel after the conclusion of such agreement, makes sure the notary until registration of the property right of ipotekodatel to the real estate.
Burdening by mortgage of real estate is subject to state registration in the procedure established by the law irrespective of who is owner of this property for the period of the conclusion of the mortgage agreement.
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