Complete Guide to Sell a Mortgage Property in Dubai

Do you have a mortgaged property that is ready and off-plan communities like in Six Senses Dubai, Dubai Marina, etc.,  that you want to sell but are unfamiliar with the procedure? Fam Properties breaks down the steps of how to sell mortgage property in Dubai, including the fees involved, the documents required, and the differences in off-plan mortgage property sales. Mortgaging property sounds to be a difficult process but banks and financial institutions have made it easier for people to invest in dubai property. 

Can you sell mortgaged property in Dubai?

Homeowners in Dubai will be happy to know that they can sell their financed property before paying off the mortgage. However, it is essential to note that the sale procedure of a mortgaged property in Dubai needs additional steps and can be complex if you do not know the proper procedures.

How to sell mortgaged property in Dubai?

When the homeowner has found an investor and Form F (MOU) containing the details and conditions of the sale has been signed, the steps below need to be taken when selling a mortgaged property in Dubai. sakarya escort bayan

1. Request for a certificate of liability from the lender:

The seller must apply to their bank for a letter of liability stating the amount still to be paid for the property.

2. Request for a NOC from the developer:

After that, the seller must apply for a No Objection Certificate (NOC) from the community developer. It ensures that there should be no outstanding service fee payments to the developer.

3. Block the property on behalf of the buyer:

Before the buyer pays off the seller’s or previous homeowner’s mortgage, another procedure referred to as “property blocking” protects the buyer. The buyer, seller, and other parties must visit one of the Dubai Land Department (DLD) Registration Trustee offices to have the property blocked on behalf of the buyer. It allows the buyer to pay off the seller’s mortgage while ensuring that the seller cannot sell the apartment or property other than the buyer.

The following documents are required for blocking property in Dubai:

• Form F (MOU)
• NOC from developer
• Original passport, visa, and Emirates ID (Buyer and seller)
• Copy of title deed
• Liability statement of the seller’s bank
• Cheque in the name of the bank
• Cheque to seller
• Check payable to Dubai Land Department (for 4% transfer fee)

4. Get the clearance letter and original title deed:

The next step in selling financed property in Dubai is to present the buyer’s cheque to the bank. Once the previous homeowner’s mortgage has been paid, the bank provides the property mortgage clearance letter and the title deed to the vendor.

5. Transfer the property in the buyer’s name:

The last step in selling a mortgaged property in Dubai needs both parties to re-visit the office of the DLD Registration Trustee for the title transfer. The vendor’s existing mortgage will be cleared at this stage, and a new ownership deed will be issued in the buyer’s name.

The following documents are required for this step:

• Original title deed.
• Passport, visa, and Emirates ID.
• Mortgage clearance letter from the bank.

The above process occurs when a mortgaged property is sold to a cash buyer.

However, it is essential to know that the sales process is likely to take longer if the buyer also mortgages the property since the vendor’s mortgage is only paid off after the purchaser’s bank has finally approved the loan.

You can also request an additional clearance certificate from the Dubai Land Department (DLD) if you sell a mortgaged property in Dubai.

What are the applicable costs for selling a mortgaged property in Dubai?

Keep the following fee structure in your mind while selling a mortgaged property in Dubai: sakarya escort

1. Early settlement charges:

It is a fee that sellers must pay to set their mortgage early. However, the recently decreased early settlement charges for mortgages in the United Arab Emirates means that sellers must pay only 1% of the outstanding payment or AED 10k (depending on which is less).

2. Blocking fee:

The sellers will pay the fee to block the property before the buyer clears the previous homeowner’s mortgage. It starts at AED 1k.

3. Mortgage release fee:

While releasing the seller’s mortgage, a fee of AED 1,290 has to be paid. Additional charges should be paid to the registration trustee. The mortgaged release fee is about 1,560 AED for an Islamic mortgage case.

4. NOC Fee:

The NOC usually costs between AED 500 to AED 5000, depending on the developer, and the fee is generally paid by the seller.

Please note that additional fees can apply from case to case.

Frequently Asked Questions

1. What does it mean when a property is under mortgage?

A mortgage is a temporary document of property to secure a money loan. The individual who owns the land is the “Mortgagor.” The individual or bank who lent the money is the “Mortgagee.” 

2. How can I sell my mortgaged property?

When selling a mortgaged, the seller must provide the following documents:

• Sale contract.
• Documents of home loan.
• NOC (No Objection Certificate) from the developer (based on the property type).
• Debit certificate.
• Receipts of property tax (if any).
• Approval of the co-owners (if it is a joint property).

3. How can one restrict mortgage-containing property in Dubai?

According to the procedure referred to on the website of DLD.

• Go to the real estate registration trustee office.
• Submit the necessary documents to the officer.
• Let the transaction data be verified.
• Pay the charges and get an invoice.

4. How can I transfer my mortgaged property to a buyer?

However, it requires a proper procedure in transferring the mortgage from the seller to the buyer. The seller must provide the buyer with a letter outlining the home loan foreclosure. If the transfer is made through the bank, the buyer will need to fill out a new mortgage application form and pay the appropriate fees. escort bayan

5. Requirements to regulate a Mortgage property in Dubai?

To regulate a mortgaged property in Dubai, you have to submit the documents mentioned below:

1. Buyer and sellers’ Emirates ID card, a copy of the valid passport (for non-residents).
2. The developer’s letter or debit certificate with the outstanding amount.
3. Managers’ cheques:

• On behalf of the developer or the bank with the debt amount.
• The seller with the outstanding balance.
• On behalf of Dubai Land Department (DLD) with 4% as selling fees
• On behalf of the Dubai Land Department (DLD) with AED 1,020 as restriction fees

4. Power of attorney when an individual appoints someone on their behalf.

5. How much is the fee for blocking a mortgaged property in Dubai?

Here is a list of the fees you will have to pay to block a mortgaged property in Dubai:

6. What about the sale of the off-plan mortgage property in Dubai?

If the property is off-plan under the mortgage, we recommend you check with the developer to determine if the owners can sell the land. Dubai Developers may have policies restricting the sale of the off-plan properties Dubai before a specific percentage of the payment plan has been cleared. So it is crucial to verify before you decide to mortgage your off-plan property such as Six Senses Dubai. Even if you apply via bank finance, check the interest rate and the installment plan attached to it. escort