Have you chosen to buy a home after renting for many years in one of the United Arab Emirates' most affluent emirates? Regardless of how beautiful it seems from the outside, owning a home in the UAE may be a burden with all the property research and decision-making. But, once you’ve made up your mind, there’s no turning back but to balance your funds. You should familiarize yourself with the foundations of UAE mortgage legislation before becoming too enthusiastic about the prospect of purchasing a 3 bedroom villa for sale in Dubai.
The Central Bank of the UAE issued new guidelines for mortgage lending to financial institutions at the end of October 2013. The rules made it clear that the Central Bank intends for all financial institutions offering mortgage loans to adhere to the regulations set out. However, every few years, these regulations would be improved.
The Mortgage Law
After some revisions to the previous version, the UAE mortgage legislation finally went into force in 2019. As per the legislation, purchasers must comply with the following orders:
Registration for Mortgage
Registration with the department is required for a mortgage to be valid (Article 7). Furthermore, unless both parties agree differently, the mortgage, also known as the property owner, must pay for the agreement.
Mortgage Application for RERA
All parties necessary for a valid Mortgage Application for RERA registration are spelled out in the legislation.
Mortgage Laws and Regulations
Article 10-20 provides the rights and limits for the mortgagee and mortgagor over the full mortgage time. The UAE is very protective of its citizens' rights, therefore any violation will result in severe punishments from the government.
Default in Payments
Articles 25 through 30 detail the steps a mortgagee must take to initiate foreclosure proceedings in the event of a borrower's payment failure. A public auction must be held in accordance with UAE mortgage legislation when all notice periods and penalty processes have expired.
