Land Mortgage Agreement Template for Saudi Arabia

The Land Mortgage Agreement is a fundamental document used in Saudi Arabian real estate financing transactions to create a security interest over real property. It is essential when a property owner (mortgagor) seeks financing and offers their real estate as security to a financial institution (mortgagee). The agreement must strictly comply with Saudi Arabia's Real Estate Mortgage Law, Finance Laws, and Shariah principles, making it distinct from conventional mortgages in other jurisdictions. The document includes comprehensive details about the mortgaged property, secured obligations, parties' rights and responsibilities, and enforcement mechanisms. It requires registration with relevant authorities and must include specific provisions ensuring its enforceability under Saudi law while maintaining Shariah compliance. This type of agreement is particularly crucial in the Saudi Arabian market where all financial transactions must align with Islamic finance principles.

1. Parties: Identification of the Mortgagor (property owner) and Mortgagee (financial institution), including full legal names and details

2. Background: Context of the mortgage agreement, including reference to the underlying financing arrangement and Shariah compliance declaration

3. Definitions: Key terms used throughout the agreement, including technical and legal terminology

4. Property Details: Comprehensive description of the mortgaged property, including its location, boundaries, and title information

5. Secured Obligations: Details of the debt or obligations secured by the mortgage, including the principal amount and profit rate

6. Creation of Mortgage: Express provisions creating the mortgage and its registration requirements

7. Representations and Warranties: Mortgagor's declarations regarding property ownership, authority to mortgage, and absence of encumbrances

8. Covenants: Ongoing obligations of the Mortgagor regarding property maintenance, insurance, and payment of taxes

9. Events of Default: Circumstances constituting default and their consequences

10. Enforcement Rights: Mortgagee's rights and remedies upon default, including power of sale

11. Term and Termination: Duration of the mortgage and conditions for its release

12. Notices: Communication procedures between parties

13. Governing Law and Jurisdiction: Confirmation of Saudi law application and jurisdiction of Saudi courts