Ask the Agent - How to sell a property to cash buyers if you still have an outstanding mortgage

I still have an outstanding mortgage, but I am receiving offers from cash buyers. Can I sell my property? How can I settle the amount with my bank?Dhiren Gupta, Managing Director, 4C Mortgage Consultancy

My business partner purchased a property on a post-handover payment plan. I would like to buy it through mortgage. Please advise.

The mortgage is possible. You can purchase the property from your partner and pay the unsettled amount to the developer. Since you like to have a mortgage, the bank will do proper due diligence to check your eligibility and lend you accordingly. It will review your income documents, personal documents, bank statements and property documents (sale and purchase agreement, payment plan details). It will also do property valuation and offer you a loan based on the current market value. To transfer the property in your name, opt for the resale mortgage procedure. Once the bank pays the complete amount to the developer, get the title deed in your name from the Dubai Land Department. Henceforth, the bank will hold the original title deed and release the balance fund.

I bought a property in Dubai with an idea to pass it on to my children. How is this possible?

That can be done if you bought a ready property and the transfer procedure should be considered a gift procedure. This requires some guided steps which are completed at the Dubai Land Department (DLD). However, once you wish to transfer the property, you can approach the DLD to request the transfer of your property in your children’s name. The DLD will issue the value estimation certificate; simultaneously, you can request for the No Objection Certificate (NOC) from the developer. Thereafter, present your personal documentation which includes children’s birth certificates translated into Arabic and notarised by the UAE Embassy, passport copy, residence visa and national ID copy. You need a letter issued by the Dubai Court which states the Declaration of Grant. There are minimal charges to be paid during the grant process.

I live and work in Germany. I have five properties rented in Dubai. I want to buy more on mortgage. Should I approach a bank or hire an agent?

You can approach a bank directly to evaluate your properties and based on your eligibility, equity will be calculated. But as you said, you have five properties and wish to grow equity from all; in that case, you might be required to consult different banks as some may consider all property or some may appraise only one or two. So, you have to be vigilant when shopping around.

Hiring a mortgage broker will certainly be an added advantage to your pursuit as you need to confer your case with one individual and based on your requirement, you can get the preeminent mortgage deal. Since mortgage consultants are dealing with almost every bank, they are well informed about each bank’s product offerings which can add value to your requirement.

Moreover, taking a consultant advice will make your job easy as they perform all the legwork for you, which saves lots of time and money.

I still have an outstanding mortgage, but I am receiving offers from cash buyers. Can I sell my property? How can I settle the amount with my bank?

If it’s a cash buyer, he needs to pay you the outstanding amount first so you can settle the loan amount. If it’s a mortgage buyer, the buyer’s bank will give manager’s cheques to your bank upon receiving the liability letter from your bank. If you have a cash buyer, you (the seller) need to approach the bank and inform them about the property sale by showing them the copy of the memorandum of understanding (MOU). The bank will review it and issue a liability letter in your name. The buyer needs to deposit the outstanding amount to the seller’s account.Subsequently, the seller will apply for a No Objection Certificate (NOC) with the developer. Once the seller has all the property documents, they both need to take an appointment at the Dubai Land Department to request for property transfer. To transfer the property, there will be additional charges which need to be considered.

Question of the Week: I live in Dubai and my landlord sent me an email notifying me that he wants me to vacate the property within 12 months. Is this the legal way?

To be candid, in the case of eviction, a landlord needs to provide the tenant a 12-month notice.

But the UAE Tenancy Law stringently provides that an eviction communication must be sent via registered mail or through the courts (Notary Public).

Hence, as per the edict notice sent by email, it is considered not enough to create an authorised notice for eviction.

In Dubai, a landlord is permissible to ask his tenant to vacate the property if he is selling the property, if he has to do some maintenance work in it, if the property needs to be demolished, if members of his family wish to live in the property, or if he (the landlord) wants to use it personally.

But if we look at the other side of the coin, a tenant may decide to agree with the landlord if the reason to vacate the property seems valid without taking the issue into a formal process.

However, if the tenant discerned that the landlord had the unit vacated and re-rented it at a higher rental value, then the tenant can take legal action against the landlord.

So, please look into the reason given by the landlord and decide accordingly.

Source: Freehold


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