The bill on preserving mortgage housing for bankrupts was approved in the first reading

The State Duma adopted in the first reading bill, which allows the courts to leave bankrupts with the only mortgaged housing if third parties can pay the loan. According to the document, third parties can be a guarantor, a relative, or the bankrupt himself after completion of all procedures in the insolvency case.

The proposed bill gives the court the power to approve a settlement agreement or debt restructuring plan for the bankrupt’s only mortgaged home. According to current legislation, this possibility does not apply to mortgaged housing.

The bill was submitted to the State Duma in March 2023. It was introduced by deputies Natalya Kostenko, Ivan Demchenko and Andrei Doroshenko (all three are members of the United Russia party). The explanatory note notes that judicial practice, in which mortgage borrowers are deprived of their only home, “casts doubt on constitutional guarantees in the field of housing provision for citizens.”

Lusine Balasyan