Optimizing Mortgage Purchases in Dubai: Essential Guidelines for Group and Family Buyers

Purchasing a property through a mortgage in the secondary market can be a complex process, especially when multiple buyers, such as family members or a group, are involved. It is crucial for buyers to understand the implications of adding multiple names to the Memorandum of Understanding (MOU) or the Unified Contract F in DLD and eventually the new title deed, particularly if not all individuals are mortgage applicants. This article outlines key points to consider and potential challenges that may arise.

Verify Bank Conditions Before Adding Multiple Buyers to the MOU/Unified Contract F

When considering purchasing a property as a family unit or group of buyers, it is essential to first consult with your mortgage advisor and bank. Banks have specific criteria regarding whose names can appear on the MOU and title deed. Some banks only allow the mortgage applicant’s name on the MOU and title deed, while others may permit the inclusion of family members under certain conditions, such as limiting the percentage of their ownership shares.

Failing to verify these conditions in advance could lead to significant delays and additional costs. To avoid such setbacks, it is advisable to:

  • Consult Your Mortgage Advisor Early: Before instructing your real estate agent to include multiple names on the MOU, confirm with your mortgage advisor whether your bank allows such arrangements.
  • Obtain Written Confirmation from the Bank: Secure a clear, written statement from your bank confirming their policy on adding multiple names to the MOU and title deed.
  • Understand Bank-Specific Conditions: Each bank has different policies, and what works for one bank may not be acceptable to another.

Gifting as a Post-Transfer Solution: How fäm Conveyancing Can Assist with Gifting!

If your bank does not allow multiple names on the title deed during the mortgage process, there is still an option to add family members after the property has been transferred. This can be achieved through a property gifting process, where you can add your spouse or children to the title deed post-transfer. As detailed in our previous articles, the Dubai Land Department (DLD) charges a reduced transfer fee of only 0.125% of the property’s value for gifting to first-degree relatives. Our conveyancing team can guide you through this process to ensure it is completed smoothly and efficiently.

Advice for Buyers: Be Informed About Bank Requirements

Buyers should always ensure they understand the conditions and requirements set by their agents regarding property transactions. If there is a situation where the seller wants the selling price to be issued under a third party's name, even with a Power of Attorney (POA), it is crucial that this is communicated clearly to both the mortgage advisor and the bank from the start and before the signing of the MOU.

Some banks have strict policies against issuing cheques to third parties, which could complicate the process and potentially require changing mortgage providers. Always confirm the feasibility of such arrangements with all parties involved to avoid unexpected challenges during the process.

Conclusion

For mortgage buyers considering adding multiple names to their property purchase, it is vital to thoroughly check bank requirements and obtain clear consent before finalizing any documents. This proactive approach can prevent delays and ensure a smoother transaction process. If your bank does not allow multiple names during the mortgage process, consider utilizing the post-transfer gifting option to achieve your desired ownership structure.

At Fäm Conveyancing, we are here to support you through every step of the mortgage and property gifting processes. For personalized assistance and expert guidance, please reach out to our team.



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