People of advanced years quite often worry about providing their children and grandchildren with their own real estate. You can inherit a house or apartment from your parents in several ways: by testament, by law, or even as a gift during their lifetime. The latter option is often used by older people to calm themselves. It is for this reason that they seek legal advice on how to give an apartment to a child or grandson so that other family members do not apply for it.
When is a deal possible?
According to the current legislation, any citizen has the right to transfer his property to another, including free of charge. That is, it turns out that it is possible to present a privatized apartment, which cannot be said about communal property. By the way, only the property for which all the documents were executed during his lifetime was also left as an inheritance. It turns out that the first and most important condition for concluding such a transaction is the possession of the subject of donation legally.
The second, no less important point is the absence of burdens. This means that it is impossible to give an apartment, car or other thing if it is pledged to a bank or in a dispute. The "cleanliness" of the property during the conclusion of the transaction is checked by a notary.
The third condition for giving is gratuitousness. That is, the contract cannot specify any payment for obtaining property or additional conditions for entering into ownership. If the latter is available, the transaction can be formalized with a life-long maintenance contract or a will be made. Donation cannot be carried out in exchange for any service.
And last but not least, the legal capacity of the parties. When making any transaction on the alienation of real estate (including donations), the notary must make sure that both the donor and the donor are responsible for their actions. In case of the slightest doubt, the transaction simply does not take place.
Who can give real estate
When it comes to such a serious property as an apartment, house or other premises, alienation occurs mainly with notarization. Participants in this transaction can be both relatives and people completely alien to each other. After all, no one forbids making expensive gifts even to strangers. The only question is that in the latter case, a tax on a donated apartment may arise, and not a small one.
When a transaction is concluded between relatives, tax liabilities also sometimes appear. So, before you give the apartment to your son, daughter, grandson or granddaughter, you should consult with a lawyer about all the costs associated with processing such a transaction. Perhaps a different way of alienation (sale, barter, etc.) will turn out to be more beneficial.
Registration of a transaction without notarization
According to the norms of the current legislation, a real estate gift agreement can be concluded in simple written form. This means that you can do without a notary public. Such a deal would be completely legal. As for the state registration of both the contract itself and the ownership of the new owner, no one has canceled it. It is carried out regardless of the form of conclusion of the contract. Simply, if a notary is responsible for the transaction, then he will help with registration. When a gift is made without his participation (usually this is done in order to save money), the contract itself and the right of ownership are entered into the database by the relevant state body after payment of the state duty. That is, in simple terms, in order for the gifted person to become the legal owner of the apartment, he will still have to run through various services.
Alienation of joint ownership
Sometimes the property that a person is going to give or sell does not fully belong to him. This is not about shared ownership, since in this case everyone disposes of their part, but about joint ownership, for example, acquired in a marriage. Even in the case of donating such an apartment without involving a notary in the transaction, the spouse's consent to conclude it will be required. The exception is cases of sole ownership. This can be either under the current marriage contract, according to which each spouse has his own property, which he has the right to dispose of without the knowledge of the other. The second option is to receive real estate free of charge. That is, if a person wants to give someone a donated apartment, the consent of the husband or wife in this case is not necessary.
It should be noted that in some cases, the spouse can still apply for part of the property received free of charge. For example, if the living space was renovated at the expense of joint funds, the house was completed or there was a redevelopment, as a result of which the object went up. In this case, they will have to defend their rights to the donated apartment in court. Regardless of the form and method of alienation of property, a spouse's statement of consent to the transaction is subject to notarization.
How is a donated apartment divided upon a divorce?
So, property, including real estate, received free of charge, is in personal ownership. However, if its value was increased due to jointly earned funds, then in case of divorce, the spouse has the right to a share. Parents should remember this and think before giving their daughter or son an apartment for a wedding. Naturally, at such a joyful moment, no one thinks about the possible collapse of the newly created family. But who, if not parents, should worry about the fate of their own child? If the transaction has already been completed, and there is no turning back, you can once again present the apartment you donated to another relative and not worry about a possible separation when you part. It is better to play it safe and take extra measures than to try to sue your own property in the future.
Which is better: gift or testament?
This question is often considered rhetorical. The fact is that a definite answer to it simply does not exist. And this means that in each case, the right decision can be your own. To accept it, you should understand the features of both transactions, the nuances of their completion and possible consequences.
The first thing you should pay attention to when choosing is expenses. If the property is transferred into free ownership to an outsider, he must pay tax on the donated apartment, which is 13% of its assessed value. The exception is made only by close relatives (children, parents, brothers, sisters, guardians, trustees and spouses). So if a grandmother wants to transfer her home, for example, to her grandson, it will be cheaper to first give it to her son or daughter, so that in the future they can give the apartment they donated to their child. With the payment of taxes in the inheritance of real estate, everything is much more complicated, so that the advice of a competent lawyer does not hurt to make a final decision.
Ownership moment
Another significant difference between receiving a gift and accepting as an inheritance is time. When drawing up a will, the right of ownership does not immediately change. In order to become the owner of such an apartment, it is necessary to wait 6 months after the death of the testator and only then draw up documents. In addition, direct relatives are entitled to their share, even with a will. A document compiled in accordance with all the rules will not prevent the owner of the property from selling his apartment or giving it to a third party during his lifetime.
As for the gift agreement, it provides the right of ownership to the object indicated in it at the time of its registration. That is, right away. This ensures the safety of the giftee more than a will. But if we consider the opposite point of view, we get a different picture. Having presented an apartment to a grandson, daughter or other relative, a person loses all rights to it. In some cases, after this wide gesture, he risks being in the street.
Lifetime Maintenance Agreement
It can be called a compromise between gift and testament. On the one hand, ownership of it comes immediately. So neither relatives, nor third parties can no longer claim property. On the other hand, the former owner of the apartment reserves the right to use. On top of everything else, property is subject to a prohibition of alienation (as when applying for a mortgage at a bank). This means that the new owner will not be able to present a donated apartment, sell it or mortgage it until the death of the former owner.
The ban will be lifted by a notary in accordance with applicable law. To do this, the new owner will need to apply with a contract and a death certificate. This scheme is beneficial to both parties. The degree of relationship here does not play any role.
In addition, the terms of the transaction indicate all conditions of the transaction. If they are not fulfilled, it shall be considered canceled. You can specify everything from the use of the facility to the care of an elderly person (treatment, rehabilitation, recreation, domestic services, etc.). Therefore, before giving the apartment to a relative, experts strongly recommend that you consider this option.
Transaction Cancellation
Before performing any action, a person must understand its consequences, as well as the possibility of cancellation. Everyone has the right to change their mind, circumstances may change, etc.
It turns out that any transaction is recognized as invalid, but only if certain procedures are followed and all conditions are met. The easiest thing to do with a will. His person can change as much as an unlimited number of times. Naturally, it costs money, but there are no legal problems.
If the apartment is donated, then it is possible to cancel such an action, but it is not so simple. According to the current legislation, gratuitous transfer to the property, documented, is canceled only in case of a threat to the life or health of one of the parties. As a rule, we are talking about the donor and his environment. But for the deal to be recognized as invalid, the threats will need to be proved.
The contract for life maintenance may be canceled in case of violation of its clauses or in court. In both the first and second cases, it will be necessary to prove certain facts.
Donation of a mortgaged apartment
In connection with the spread of the phenomenon of mortgage lending, some people have questions related to the disposal of encumbered property. Theoretically, this is possible, but with the consent of the mortgagee. The bank, in turn, is unlikely to agree to the deal, because it is not beneficial to him. Therefore, before you give a mortgaged apartment, you have to fully pay for it and remove all the burdens.
Alienation of a share
If with the donation of an entire apartment everything is more or less clear, then what if there are several owners, and one of them wants to transfer his share to a third party? In the event of the sale of such property, the co-owners have priority right to purchase. If we are talking about gratuitous alienation, then everyone is equal. That is, before the sale of a share, the owner is obliged to offer it to the co-owners, and when giving a gift, he can order it at his sole discretion.
Can I give a donated apartment?
The ownership right at the conclusion of this transaction occurs at the time of registration. After that, the new owner has the full right to dispose of the property at his discretion, including selling, mortgaging, bequeathing or giving. At the same time, at the time of the new transaction, all taxes and duties on the previous one must be paid.
Limitation of actions
Any transaction, from the sale to the life-long content, can be canceled by court order. There may be plenty of reasons to turn to the servants of Themis in search of justice after giving the apartment. But no more than with a purchase, exchange, or other alienation. So itβs not worth panic over the possible termination of the transaction just because it was a gift. But also forget that the statute of limitations for such cases is 3 years, too.
The execution of a real estate donation transaction is only relevant in cases where it is a matter of truly free transfer of property to close relatives. An attempt to replace it with a banal purchase and sale in order to reduce costs is ineffective, since it can only lead to their increase due to the need to pay income tax.