03/07/2012
Mr. Abdulrahman Rashed Al Rashed, Chairman of the Asharqia Chamber, praised the approval of the new mortgage law which was passed in a meeting of the Council of Ministers on Monday under the chairmanship of the Custodian of Two Holy Mosques King Abdullah bin Abdul Aziz Al Saud. The new law will address issues related to real estate financing and lease out of land.
Al-Rashed highlighted various clauses of the new law including the guarantees required in the exercise and the financing of real estate and other movable properties, saying that the adoption of the two systems will protect the financiers and the borrowers. He also mentioned the risks of the guarantors in the process of financing, especially with regard to the nature of the assets related to mortgage systems. The new law will determine the rights of all the parties to the mortgage contract.
Al Rashed said that the most important positive results of the system of financing the real estate properties were the establishment of a credible market under which the joint-stock companies specializing in the financing and in collaboration with real estate developers will be set up, with the possibility of refinancing. These companies will work with target groups and housing associations to enable beneficiaries to own real estate assets.
He stressed that the adoption of the mortgage law by the Council of Ministers for a regular financing of the real estate will bring an impetus to the real estate sector and contribute to the higher rates of economic growth. It will help the national economy towards more recovery and progress, thereby contributing to raise the competitiveness of the local economy in the world market, in addition to strengthening the role of the real estate sector with regard to social development in general, and urban development in particular.
