Saudi Arabia:
The Circular Of The Saudi Arabian Monetary Agency Concerning The Mortaging Of Real Estate In Favor Of Banks And Financial Institutions
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By way of circular number 381000089828 dated 26/8/1438 H.
(22/5/2017 G.), the Saudi Arabian Monetary Agency
("SAMA") has ordered banks to cease the
practice of transferring the ownership of secured real estate into
their name, as opposed to simply recording a mortgage on the same.
SAMA has offered banks and financial institutions a three-year
grace period to comply. SAMA has also requested that it be informed
of any instance where a Public Notary refuses to record a mortgage
on a real estate.
By way of background, a Registered Real Estate Mortgage Law was
enacted in 2012 (pursuant to Royal Decree No. M/49 dated 13/8/1433
H. (3/7/2012 G.)) and requires that mortgages be registered. Before
this enactment, Notaries Public were reluctant to register
mortgages.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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