Debts can make it difficult to sell real estate: what will change for Ukrainians from October

In Ukraine, there are plans to strengthen automated verification of debtors during real estate transactions. The changes are related to the digitalization of enforcement proceedings and are provided for by a law adopted by the Verkhovna Rada in April.

In particular, starting in October, notaries and state registrars will verify real estate sellers through the Unified Register of Debtors.

This was reported by the Ministry of Finance.

What will be checked before selling real estate

Before certifying the transaction, the notary will check information about the seller in the Unified Register of Debtors.

If there is information about the property owner’s debt or open enforcement proceedings, this may become an obstacle to carrying out the transaction.

In this case, the notary will be able to refuse to certify the transaction.

The restriction will be temporary. After the debt is settled, the possibility of conducting a real estate transaction may be restored.

What debts can cause problems

The Unified Register of Debtors may contain information about persons with unfulfilled property obligations.

This includes, in particular, debts for:

loans;
alimony;
taxes;
fines;
housing and communal services;
other obligations that are collected on the basis of court decisions or executive documents.

Thus, before the planned sale of an apartment, house or other real estate, owners should check in advance for the presence of enforcement proceedings and information about themselves in the relevant register.

Data will be transferred automatically

One of the key innovations will be the further digitalization of enforcement proceedings.

Information exchange between enforcement service bodies, state registers, banks, payment systems and notary databases should occur automatically.

This will allow for faster identification of debtors and application of restrictions provided for by law without lengthy exchange of paper documents between different institutions.

Therefore, the presence of unsettled debt may have consequences for the owner directly when attempting to carry out a registration or notarial action with the real estate.