Russian Cabinet Approves Bill Mandating Notarization of Mortgages

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The Russian government has approved a draft law that mandates notarial certification of mortgage agreements between individuals. The initiative aims to enhance protection for citizens against unscrupulous lenders offering loans secured by residential property.

The bill proposes amendments to Article 53 of the law "On State Registration of Real Estate" (an act regulating real estate transactions in Russia). Under the proposed changes, the mandatory involvement of a notary will be required when the subject of the mortgage is a residential property or a share in common ownership of such property. The new rules will apply to transactions between individuals, including sole proprietors.

It is expected that the notarized form will provide additional protection for the parties involved. The notary will be obligated to explain the meaning and consequences of the agreement, verify that the document reflects the actual intentions of the parties, and ensure that the participants are legally competent and acting voluntarily.

The government believes that this measure will help reduce fraud risks and serve as an additional tool for ensuring the legality of loans secured by residential property. The bill is part of broader efforts to increase transparency in certain segments of the economy and strengthen protections for borrowers.