Short Sale Agreement for United Arab Emirates

Short Sale Agreement Template for United Arab Emirates

A comprehensive legal document governed by UAE law that facilitates the sale of a property for less than the outstanding mortgage amount, with the lender's approval. This agreement outlines the terms and conditions of the short sale transaction, including purchase price, lender approvals, completion requirements, and obligations of all parties involved. It incorporates specific UAE real estate regulations, including compliance with RERA guidelines where applicable, and addresses the unique requirements of Islamic finance principles that may affect the transaction.

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What is a Short Sale Agreement?

The Short Sale Agreement is utilized in the United Arab Emirates when a property owner needs to sell their property for less than the outstanding mortgage amount, typically due to financial distress or market conditions. This document is crucial in the UAE real estate market as it provides a structured framework for negotiating with lenders, protecting both sellers and buyers while ensuring compliance with UAE Federal Laws and emirate-specific regulations. The agreement includes detailed provisions for lender approval, property valuation, payment terms, and completion requirements, while incorporating necessary considerations for Sharia compliance where applicable. It's particularly relevant in market downturns or when property values have decreased significantly below the original purchase price.

What sections should be included in a Short Sale Agreement?

1. Parties: Identification of all parties including seller, buyer, and any relevant financial institutions

2. Background: Context of the short sale, including current property status and outstanding obligations

3. Definitions: Key terms used throughout the agreement

4. Property Details: Comprehensive description of the property including location, size, and registration details

5. Purchase Price: Agreed purchase price and payment terms

6. Lender Approval: Terms regarding obtaining necessary approvals from existing mortgage holders

7. Conditions Precedent: Conditions that must be met before the agreement becomes effective

8. Completion Requirements: Steps required to complete the transaction

9. Representations and Warranties: Statements of fact and promises made by both parties

10. Default and Remedies: Consequences of breach and available remedies

11. Governing Law and Jurisdiction: Specification of UAE law application and dispute resolution procedures

What sections are optional to include in a Short Sale Agreement?

1. Broker Provisions: Include when real estate brokers are involved in the transaction

2. Property Management: Include when the property is part of a managed community or has specific maintenance requirements

3. Tenant Rights: Include when the property is currently tenanted

4. Mortgage Assumption: Include if the buyer is assuming any existing mortgage obligations

5. Tax Implications: Include when there are specific tax considerations or requirements

6. Property Inspection: Include when specific inspection requirements or findings need to be addressed

7. Force Majeure: Include when specific circumstances beyond parties' control need to be addressed

What schedules should be included in a Short Sale Agreement?

1. Property Description Schedule: Detailed technical description of the property including plot number, municipality details, and exact measurements

2. Outstanding Obligations Schedule: List of all current mortgages, liens, and other financial obligations

3. Required Approvals Schedule: List of all necessary approvals and authorizations needed from various parties

4. Payment Schedule: Detailed breakdown of payment terms and timelines

5. Due Diligence Documents: List of all required documentation for completion

6. Property Condition Report: Current condition of the property and any known issues

7. Power of Attorney: If applicable, authorization documents for representatives

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Publisher

Genie AI

Document Type

Sales Agreement

Sector

Sales

Cost

Free to use
Relevant Industries

Real Estate

Banking & Financial Services

Legal Services

Property Development

Property Management

Investment & Asset Management

Construction

Professional Services

Relevant Teams

Legal

Real Estate

Compliance

Risk Management

Property Management

Asset Management

Investment

Banking Relations

Transaction Processing

Valuations

Relevant Roles

Real Estate Manager

Property Lawyer

Mortgage Officer

Real Estate Broker

Property Valuation Specialist

Legal Counsel

Compliance Officer

Risk Manager

Asset Manager

Investment Manager

Property Portfolio Manager

Real Estate Transaction Coordinator

Banking Relationship Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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