Mortgage for IDPs with housing vouchers: The Rada may allow mortgaging housing purchased with state aid

The Verkhovna Rada Committee on Legal Policy recommended the parliament to adopt as a basis bill No. 15335, which aims to regulate the possibility for internally displaced persons (IDPs) to acquire housing through a combination of state support and mortgage lending.

The bill is titled "On Amendments to Certain Laws of Ukraine Regarding Real Estate Purchased with a Mortgage."

Why changes are needed

The bill was developed to create a mechanism allowing IDPs who lived in temporarily occupied territories to resolve housing issues through a combination of housing vouchers and loan funds.

Currently, the state program provides assistance to such categories of citizens for housing acquisition. However, to fully utilize this mechanism, it is necessary to legally regulate the mortgage of real estate purchased or financed using vouchers and loans.

The bill's authors propose amendments to the laws of Ukraine:

• "On Mortgage";
• "On State Registration of Property Rights to Real Estate and Their Encumbrances";
• "On Notariat".

As reported by the Judicial and Legal Newspaper, bill No. 15335 aims to create legislative conditions for combining housing vouchers with credit financing when purchasing or constructing housing for IDPs. The document also provides for restrictions on the alienation of real estate acquired or financed through this mechanism.

Certain provisions of the bill concern the powers of notaries to impose a prohibition on alienation of residential real estate and land plots on which they are located if housing vouchers were used for their acquisition or financing of construction.

The need for amendments is explained by the authors as a requirement to regulate the housing provision procedure for IDPs involving not only state support in the form of vouchers but also loan funds.

The bill is intended to reconcile the established five-year prohibition on alienation of such housing with the possibility of mortgage registration. This will allow housing voucher recipients to attract additional financing secured by the acquired property. At the same time, the document provides mechanisms to protect creditors' rights in cases where the borrower fails to fulfill the primary obligation, including the possibility of foreclosure on the mortgage object.

What shortcomings of the bill were identified during its review

Despite general support for the bill's concept, several bodies expressed remarks on certain provisions during its review.

The Main Scientific and Expert Department of the Verkhovna Rada Apparatus noted that the legal nature of the housing voucher, grounds and conditions for its provision, the circle of persons entitled to receive it, the procedure for formation, use, termination, and other essential elements of the mechanism are currently defined exclusively by the Procedure for Providing Assistance to Solve Housing Issues for Certain Categories of IDPs, approved by the Cabinet of Ministers of Ukraine Resolution No. 1176 dated September 22, 2025. At the same time, legislative regulation of these issues is currently absent.

The department stated that this approach is debatable from the standpoint of systematic regulation of social relations, as subordinate normative legal acts should be issued to implement laws, not vice versa. Therefore, the department considers it legally correct to define the main principles of legal regulation of the housing voucher at the law level, including its legal nature, grounds, and conditions for provision, while granting the Cabinet of Ministers authority to regulate certain aspects of its use.

The Ministry of Justice of Ukraine generally supported the bill, noting that its provisions aim to create a mechanism for additional credit financing for certain categories of IDPs by mortgaging housing purchased using housing vouchers, while simultaneously introducing legislative guarantees to protect creditors' rights in case of possible foreclosure on the mortgage object. According to the Ministry of Justice, the proposed changes are necessary as they regulate legal relations related to notaries imposing prohibitions on alienation of residential real estate acquired using housing vouchers, including the possibility of mortgaging such property.

At the same time, the Ministry of Justice pointed out that according to parts six and seven of Article 319 of the Civil Code of Ukraine, the state does not interfere with the exercise of ownership rights by the owner, and restrictions on this right may only be established in cases and procedures defined by law. Therefore, the ministry believes that relations related to the prohibition of alienation of residential real estate should be regulated by law, while the procedure approved by the Cabinet of Ministers should only define the implementation procedure of its provisions. In this regard, the Ministry of Justice considers the bill requires further refinement.

Earlier, it was reported that the Notarial Chamber of Ukraine appealed to the parliamentary Committee on Legal Policy with its proposals to bill No. 15335, which aims to regulate real estate acquired with a mortgage using state housing vouchers.

The Notarial Chamber supports the legislative initiative but emphasizes that to effectively implement it, it is necessary to eliminate several gaps that already arise during the notarial registration of such transactions and may affect the implementation of state housing programs and compensation mechanisms.

In particular, the Notarial Chamber pointed out the need for proper regulation of encumbrances on property rights for indivisible objects of unfinished construction and future real estate objects. Additionally, the Notarial Chamber proposed exempting owners of housing destroyed due to the armed aggression of the Russian Federation from paying administrative fees for terminating ownership rights, as well as for registering ownership rights, prohibitions on alienation, and mortgages on housing purchased using housing certificates or vouchers.

Following the review, the Committee on Legal Policy concluded that comprehensive technical, legal, and editorial refinement of the bill is necessary, as well as harmonization of certain provisions with other legislative norms. Nevertheless, the committee recommended the Verkhovna Rada include bill No. 15335 in the agenda of the fifteenth session of parliament and adopt it as a basis, using the procedure of submitting proposals and amendments during preparation for the second reading to eliminate errors, clarifications, and contradictions in the document's text.

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