Maternity capital for the purchase of a car: has the law been adopted?

There have been discussions about the possibility of using maternity capital to buy a car for almost 10 years. The issue was repeatedly raised by legislators, but there were still no changes at the federal level. In 2021, as before, maternity capital can only be used to improve housing conditions, education or the mother’s future pension. As a result, a situation arose where almost half of the families holding the certificate were unable to use the capital due to the lack of need for housing improvement and other permitted uses.

Is it possible to buy a car with maternity capital?

Bills are regularly submitted to the government for consideration, which offer the opportunity to use maternal capital to buy a car. This is due to the fact that many citizens need a vehicle, but cannot afford such a large purchase. But a law on buying a car with maternity capital has not yet been adopted at the federal level.

As before, maternity capital can only be used to purchase or build real estate, pay for children’s education, rehabilitate a disabled child, or increase a mother’s pension.

Officials who support the project argue that a car is not a luxury, but a must-have. The payment amount is enough to purchase a car, so you don’t have to take out a loan. The technique can be used to earn additional income, and experts also say that after the adoption of such changes, the number of certificate frauds will significantly decrease.

But the refusal to make such amendments is due to the following factors:

• When buying a car, parents satisfy their own needs, and not the desires and needs of their children;
• the car can be broken and destroyed, and there is also a possibility of it being stolen, so the family will lose the funds received;
• equipment becomes cheaper every year;
• if the car gets into an accident, the price of the property will drop sharply;
• scammers can leave a family without a car and money.

Therefore, only at the regional level, when issuing local maternity capital, do officials allow you to buy a car. But this is only possible in some regions of the Russian Federation.

It is also useful to read: How to apply for a loan for maternity capital

Buying a car with financial capital - the pros and cons

Purchasing a car using parental capital
The question of the possibility of purchasing a car using parental capital has been raised more than once. In 2021, only a few regions joined the program. Not all officials are ready to implement the program throughout the country, and they give arguments for this.

Statistics for previous years show that more than half of citizens who received financial support at the birth of a child are not able to use them for their intended purpose. Between 2009 and 2010, about 70% of mothers exchanged their certificate for cash support for current needs in the amount of 12 thousand rubles. In the period from 2015 to 2021, there was an opportunity to receive 20 thousand rubles in cash, which was used by a third of citizens. This is why deputies and society so often raise the issue of expanding spending methods.

At the moment, family capital can be spent on buying an apartment, renovating your own home, saving money for a child’s education or for a mother’s pension. Children with disabilities were given the opportunity to purchase special goods for adaptation and comfort. From May 2015 to June 2021, the family had the opportunity to withdraw 20 thousand rubles in cash for their own needs. Is there a need to add to the list by purchasing a car or does this have nothing to do with the child?

Arguments for:

1. Not all Russians understand how to properly use government assistance. The amount received is often not enough to buy an apartment, and there are not enough own funds that can be added. Only 1% of residents took advantage of the opportunity to invest money for the intended purpose to purchase square meters. Most young parents do not consider the option of purchasing living space.
2. In order to buy a car, a young couple may not add or add a small part of their cash savings; the family budget will not be affected.
3. If desired, a car can generate additional income. You can engage in private transportation and provide taxi services for the population.
4. A personal vehicle allows families from the outback to transport their children to kindergarten, school, clubs, and the hospital. A personal car for a family will also help out in the cold season; you won’t have to freeze while waiting for city public transport or trains; it will be easier to get from the countryside to the regional center for essential goods.
5. Development of the domestic automotive industry.

Arguments against:

1. If a young family is not able to purchase an apartment now, this does not mean that such an opportunity will not arise in a few years. Children will grow up and they will definitely need their own living space. You need to take care of your child's future, and perhaps education will be a better investment than a car.
2. By investing maternity capital in her future pension, a young mother gains confidence in the future. When the car becomes outdated and breaks down, and the children grow up and leave the family, parents may be left without government support. Maternity capital invested in a pension provides stability and the right to a normal life.
3. Investing in real estate is more prudent. Even with careful handling of vehicles and timely maintenance, the car has its own shelf life, which is also relatively short. An apartment or house does not depreciate over the years, but in some regions, on the contrary, it increases in value.
4. On the one hand, a car can generate income, on the other hand, it requires large expenses, especially if it is constantly used. There is a possibility of getting into an accident, which will not only damage the car, but also pose a risk to life.
5. The question remains open: who will get the car if the parents divorce. If the mother does not have a driver’s license, then the vehicle is not relevant, which means that the investment of parental capital was not justified.
6. There are no options for clear control over the intended use of money and a car. Having cashed out funds to purchase a car, you can spend them on your needs, and having bought a car, you can immediately sell it. How are the interests of the child taken into account?
7. Most likely, the law will be aimed largely at the domestic auto industry.

It is difficult to determine which arguments are more weighty, so society and officials still cannot close this issue.

Who can buy a car with capital?

Although each region has its own conditions for obtaining and using local capital, the general requirements are considered the same.

The following persons can receive funds to purchase a car:

• mother of the child;
• father, if the woman died or lost her rights to the children;
• guardians.

Usually, certain requirements are imposed on the car itself, so citizens have to choose only a domestically produced car. It is allowed to buy only a new car at a car dealership, and not from private individuals. You won’t be able to sell your car right away to get cash, so you’ll have to own it for at least 3 years. The car is registered as shared ownership, since initially the sum of money is intended to improve the lives of children, not parents.

Attention! In some regions, it is prohibited to use a local certificate to purchase a car if the family already has a car.

Purchase and sale of an apartment using maternity capital - has the law been adopted?

A similar law was passed back in 2007. This is one of the main features of the consumption and use of targeted funds. The purchase and sale of an apartment is possible, and moreover, this rule is encouraged by the state. In this case, large banks offer extremely favorable conditions compared to standard ones.

Changing the law when using maternity capital to purchase housing is possible only in the case of purchasing the first apartment through a current purchase and sale agreement with a private person, obtaining a bank mortgage, and improving living conditions.

For those who are interested in how to properly use maternity capital to buy an apartment, you should know that only through a pension fund. No other entity has the right to legally cash the certificate. Purchasing a second apartment, an apartment smaller in size, price and other characteristics, is not allowed.

Is it possible to use maternity capital to purchase a share in an apartment?

It is possible, and this is far from news for many families.

There are two options worth noting here:

• The first is that the family does not have any housing at all, and it decides to submit such an application to the pension fund;
• Second, there is already a share in the property, but the use of funds involves the purchase of a share that is better in all respects.

In other cases, the pension fund will not cash out. Today, you can also buy a share from relatives.

Take out a mortgage using maternity capital

A product that is provided by almost every credit institution. This is permitted by law. But again, this should be the first home, or an improvement in current living conditions. Purchasing a second apartment, even by obtaining a mortgage using earmarked funds, is not allowed.

Is it possible to pay off a mortgage using maternity capital?

It can be used not only in the form of repayment of the down payment, but also non-penalty interest under the agreement. Early repayment is also provided. How long exactly this will happen is decided by the borrower.

One important condition should be noted here.

In this case, a tax deduction will not be provided if maternity capital is involved in an agreement of any nature. It turns out that using maternity capital funds to repay the loan completely excludes receiving other government preferences.

How to buy a car

If a family, after receiving local capital, decides to purchase a car, then the following steps are performed:

• select a car and a car dealership where the purchase will be made;
• the application and other documents are submitted to the social security worker;
• an inspection is carried out within a month;
• if the decision is positive, the money is transferred to the car dealership’s account;
• Parents, if necessary, add the required amount, after which they become the owners of the car.

If citizens sell their cars over the next three years, they will have to fully return the entire amount received from the regional budget.

What kind of car can you buy?

In many regions, it is allowed to purchase only a domestically produced car. Approximately 100 thousand rubles are provided for its purchase with the help of local maternity capital, so you have to invest your own funds. It is allowed to buy a car not only for cash, but also on credit.

When choosing a car and a car dealership, the following nuances are taken into account:

• only a new car is purchased, which is sold in car dealerships;
• a salon is selected whose management agrees to use the capital, since the money is transferred to the organization’s account within two months;
• Only domestically produced cars and mid-price cars are selected;
• If a car dealership sells used cars, then you can buy them, but their age should not exceed three years.

Reference! Not all car dealerships accept a certificate for regional capital, so only official dealers are selected who are willing to wait several months for the transfer of money from social security.

Preparation of documents

If a family that has received regional maternity capital decides to purchase a car, then the car itself and the car dealership are selected for this purpose. After this, a package of documents for social protection is prepared.

The following documentation is required:

• applicant's passport;
• certificate for regional maternity capital;
• an agreement drawn up with the selected car dealership, which specifies the technical characteristics of the car;
• driver's license;
• details of the car dealership to which money for the car will be transferred.

If a car is purchased with borrowed funds, then additional documents are prepared for the bank, and a copy of the loan agreement and payment schedule are sent to social security.

After transferring the papers, you need to wait approximately 30 days, during which a decision is made on the possibility of issuing money to purchase a car. If there are no errors in the documents and a suitable car is selected, then the money is transferred to the car dealership’s account.

It is also useful to read: How to pay off a military mortgage with maternity capital

In which regions is it possible to buy a car?

Regional capital funds are issued in different cities of the country, but not all regions allow you to buy a car.

Important! You can obtain complete information about regional capital from your local administration.

Officials' opinion on spending maternity capital on a car

Changes to the program occurred more than once. They were aimed at expanding the purposes for using funds.

According to the Deputy Prime Minister, spending funds from this program on the purchase of vehicles is unreliable. The argument includes the following information: the maximum number of families who were granted this certificate allocated money to improve housing conditions. But purchasing a vehicle is temporary.

Deputy Chairman, Olga Golodets, actively advocates extending the Maternity Capital program for more than 5 years, but is against various changes.

Maxim Topilin, who is a colleague of Olga Golodets, absolutely supports her opinion. He believes that it is better to channel funds into an existing mechanism.