Salar posted on August 23, 2008 19:05
To boost investor much needed confidence in Property Market, UAE & Dubai is introducing numerous new laws at the moment, the latest being a new law designed to regulate mortgages.
The new law makes any mortgage deals that are not registered with the Dubai Land Department null and void, allowing the department to better regulate property and mortgage transactions. This decision was by his Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, issued Law No 14 for 2008 that regulates property mortgages and the relations between mortgage issuer and the borrower.
This is to regulate relations between both parties involved in the mortgage process, and the Dubai Land Department, which is responsible for implementing the law and ensuring the rights of both parties. This is to includes all procedures concerning a mortgage and its legal effects on the concerned bodies, as well as execution procedures on the mortgaged property, and the relations between the mortgage lender and borrower.
To boost investor confidence the law excludes properties granted by the Government to UAE citizens for residential and commercial purposes, as those are subject to orders and instructions issued by the Ruler. The provisions of the law will be applied to properties for mortgage as property insurance with no difference between full towers or units. Please note that this new law will not change the business practices of the existing lenders in the market.
This will further solidify the investors from Europe that have been buying in UAE because of fair laws protecting investors as well as solid growth in this market in the last decade. Under the law, mortgage lender shall be a bank, financial institution or a finance company licensed by the UAE Central Bank to practice the activity of property finance.