Yes, you can sell your mortgaged property in Dubai. However, the sale requires coordination between the seller, buyer, bank and Dubai Land Department (DLD).
The mortgage must be addressed as a part of the property transfer. DLD has a specific process for registering the sale of a mortgaged property.
How Does Selling A Mortgaged Property Work?
Getting a liability letter from your bank
The first step is to request your bank for a liability letter, This confirms the outstanding payment on your mortgage. DLD requires this letter as part of the sales process. If the property was financed through a developer, the letter should be collected from the developer.
Find a buyer and agree on the sale
Once you have agreed on the sale price, the transaction can move forward. The outstanding mortgage is taken into account when arranging the payment needed to complete the transfer.
Register the sale
The buyer and seller attend a real estate registration trustee centre with the required document. DLD reviews the transaction and issues the relevant payment documentation. The process includes a bank or developer payment for the outstanding debt, a payment to the seller for any remaining amount, and the applicable DLD fees.
Settle the outstanding mortgage
The outstanding amount is paid to the bank. The seller then obtains a mortgage release letter from the bank. DLD states that the sale registration is completed after the mortgage release letter from the bank.
DLD states that the sale registration is completed after the mortgage release letter is submitted.
Complete the transfer
Once the mortgage is released and the required procedures are completed, DLD registers the sale and the property can be transferred to the new owner.
What Documents Are Needed?
For an individual sale, DLD lists requirements including:
Bank liability letter
UAE ID or valid passport for non-resident foreigners
Manager’s cheques for the outstanding debt, seller’s balance and applicable fees.
Legal power of Attorney, of someone is representing the seller or buyer
What Should Sellers Keep In Mind?
Selling a mortgaged property is possible, but timing and coordination matter. The bank’s settlement process, mortgage release and property transfer all need to be aligned. Working with an experienced property consultant and conveyancing team can help you understand the steps, prepare the required documents and coordinate with the relevant parties.
Planning to sell your mortgaged property in Dubai? Get professional advice before agreeing on a completion date or payment structure.