Foreclosure on a mortgage during martial law in Ukraine.
A mortgage is a guarantee of performance, as a rule, of a monetary obligation with immovable property, which remains in the possession of the owner during the period of the mortgage.
In case of non-fulfillment (delayed fulfillment) of the secured obligation, it can be fulfilled at the expense of this immovable property by applying for collection against it mainly before other creditors.
Foreclosure on immovable property, which is the subject of a mortgage, can be filed on the basis of:
judgment
executive inscription of a notary public
in accordance with the agreement on satisfaction of the mortgagee’s requirements
During the period of martial law in Ukraine, the process of foreclosure on mortgages suffered significant restrictions.
Yes, during the period of martial law and another 30 days after its termination, it is impossible to foreclose on immovable property of a physical person. persons, which has been mortgaged under consumer loans and to evict persons from residential premises, foreclosure on which there is already a court decision.
Also, during this period, it is impossible to foreclose on property on the basis of a notary’s executive inscription, regardless of who owns this property and what it provides.
In addition, for the period of the martial law, they are exempted from paying a penalty and from liability in the form of % annual and inflationary losses for late repayment of the loan.
Thus, the creditor’s legal levers regarding debt recovery at the expense of collateral property are extremely limited.
However, it should be remembered that the mentioned restrictions were not removed from the law, but were only stopped for a certain period, and therefore, after the end of such period, they are automatically canceled.
Therefore, for this period, the operation of the Law is suspended in part:
• implementation of the mortgagee’s right to acquire ownership of the subject of the mortgage;
• implementation of the mortgagee’s right to sell the subject of the mortgage;
• eviction of residents from residential buildings and premises transferred to a mortgage, in respect of which there is a court decision to foreclose on such objects;
• implementation of the subject of the mortgage on electronic auctions.
This applies only to consumer loans, that is, household loans. This restriction does not apply to business loans.
