What Is The Assignment Of Rights When Selling An Apartment

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What Is The Assignment Of Rights When Selling An Apartment
What Is The Assignment Of Rights When Selling An Apartment

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In civil law relationships, the assignment of rights is formalized as an assignment agreement. This is a fairly common scheme that allows you to acquire the rights to an apartment in a multi-storey new building from a previous shareholder. But, despite its popularity - at the stage of delivery of apartments almost 90% and they are purchased under cession agreements, this transaction can be quite risky.

What is the assignment of rights when selling an apartment
What is the assignment of rights when selling an apartment

Features of shared construction

After the Federal Law No. 214-FZ “On Participation in Shared Construction of Apartment Buildings …” came into force in early 2005, equity holders who signed an agreement with the developer on participation in shared construction had the opportunity to assign their right to the apartment under construction to a third face. The assignment of rights to real estate is possible, in accordance with Art. 382 of the Civil Code of the Russian Federation and Art. 11 of this law, at any time after the equity participation agreement was duly registered with the Rosreestr authorities and before the shareholder signed the deed of transfer for the apartment.

Since it is no secret that at the construction stage, especially at the beginning, it is possible to purchase an apartment at quite affordable prices, the option of assigning rights is quite attractive for many citizens who want to improve their living conditions. Another question is the reasons why the original shareholder - the assignor - wants to sell the apartment under construction under an assignment agreement, having ceded his right to real estate to a new participant in shared construction - the assignee.

Risks arising from the conclusion of the assignment agreement

One of the common reasons why a shareholder wants to assign a right may be his debts to the developer. Therefore, before the assignee signs the assignment agreement, he needs to check with the developer if there is any arrears in making regular payments for the apartment.

Another reason why the assignor wanted to get rid of the apartment is information that has become known to him about violations of the quality of construction or about the upcoming bankruptcy of the developer company, for whose actions he is not liable to the assignee. If the new shareholder even wants to terminate the contract, he will not succeed and he will be able to present all claims only to the developer and only in court.

On the other hand, the assignee must be aware that the assignment agreement may be invalidated if a number of essential conditions are not met. For example, it can be concluded only after the assignor has fully settled with the developer and paid him the price of the contract. This is confirmed by the agreement on the offset of mutual claims. In addition, a prerequisite for an assignment agreement is to obtain a written consent from the developer for the assignment of rights. And, of course, for its conclusion, the permission of the credit institution will be required if the assignor acquired an apartment on a mortgage.

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