Deed Of Assumption Of Mortgage Car Template for the United Arab Emirates

When you need to transfer a vehicle mortgage in the United Arab Emirates, a Deed of Assumption of Mortgage Car is the essential legal document that facilitates this transaction. This deed allows you to formally transfer your existing vehicle loan obligations to a new borrower, typically when selling your financed car to someone who wishes to take over your financing arrangement rather than secure new funding.

When do you need this document?

You'll require this deed in several common scenarios within the UAE vehicle market. If you're selling your financed vehicle and the buyer wants to assume your existing loan terms, this document legally transfers the mortgage obligations. The deed is also necessary when transferring vehicle ownership within families where a relative takes over loan payments, or during business asset transfers where company vehicles with existing financing are transferred to new entities. Additionally, you'll need this document when restructuring personal finances and transferring vehicle loans between your own accounts or to a spouse.

Key legal considerations

Several critical legal elements must be carefully addressed in your deed. The document must clearly identify all parties including the original borrower (transferor), new borrower (transferee), and the lending institution (mortgagee). You must include comprehensive vehicle details such as VIN number, registration details, and current market value to ensure proper identification. The existing mortgage terms, including outstanding balance, interest rates, and payment schedules, require precise documentation. Crucially, you must address the release of the original borrower from liability, though note that many UAE lenders retain the right to pursue original borrowers if the new borrower defaults. The deed should also specify whether any guarantors are involved and their continued or released obligations.

Legal requirements in United Arab Emirates

Under UAE Federal Law No. 5 of 1985 (Civil Code), your deed must comply with strict contractual requirements governing property transfers and mortgage assumptions. The document requires notarization by a UAE Notary Public to ensure legal validity and enforceability. You must obtain written consent from your lending institution, as UAE Federal Law No. 18 of 1993 (Commercial Transactions Law) requires lender approval for mortgage transfers. The UAE Traffic Department must be notified of the ownership change through proper registration procedures under Federal Law No. 21 of 1995 (Traffic Law). Additionally, UAE Central Bank Notice No. 4007/2020 mandates specific documentation for vehicle financing transfers, including creditworthiness verification of the new borrower and compliance with banking regulations. The deed must be executed in Arabic or include certified Arabic translations, and all parties must provide Emirates ID and relevant supporting documentation. Finally, ensure the transfer is recorded with the vehicle registration authority to maintain clear title and avoid future disputes.