Dubai RERA Sales Transactions, Transfers & DLD Fees question: finance company's mortgage over a Jumeirah villa

Dubai RERASales Transactions, Transfers & DLD Fees

A finance company's mortgage over a Jumeirah villa says that if the owner misses three instalments, the villa passes to the lender without further steps. The owner defaults. What is the legal position?

A The clause is void; the mortgage stays valid and is enforced by legal process
B The clause takes effect once the execution judge confirms the default
C The clause is valid, both parties having freely agreed to it in the contract
D The unlawful clause makes the whole mortgage void

Show the answer and explanation

Answer: A. The clause is void; the mortgage stays valid and is enforced by legal process

Article 11 of Law No. 14 of 2008 (in force 12 Oct 2026) says that a term transferring ownership of the mortgaged property to the mortgagee on default, or allowing a sale without proper legal procedure, is null and void, even if agreed later, but the mortgage itself remains valid. The lender must enforce through the notice, attachment and public auction route in Articles 25-28. Party agreement cannot save the clause, and the unlawful term does not bring down the whole mortgage. Source: Law No. (14) of 2008 Concerning Mortgage in the Emirate of Dubai, Arts. 11 and 25-28 (in force 12 Oct 2026).

Common mistake

Assuming an unlawful clause voids the whole mortgage, when Article 11 strikes out only the clause.

Practice more Dubai RERA Sales Transactions, Transfers & DLD Fees questions

Exam-style questions with worked answers, then full timed mocks. Free to start.

Start practising →

Study note: Sales, Transfers & DLD Fees (ECR 30/2013, Law 14/2008)Dubai RERApractice questions & mock exams

Related Dubai RERA practice questions

Nadia has signed Contract F to sell her Dubai Marina apartment, which is still mortgaged to her bank, to a cash buyer. What does the DLD procedure for selling a mortgaged property require at transfer?An owner in The Springs refinances. Her old bank's mortgage, with AED 1,100,000 outstanding, is discharged, and a new bank registers a mortgage for a loan of AED 1,400,000. What DLD fees apply to the two entries?Noura has completed her broker training and passed the DLD's brokerage test. She asks which body Law No. 5 of 2020 empowers to issue qualification certificates to real estate practitioners. Which is it?

Build a daily practice habit — a few exam-style questions a day, with worked answers. Free to start.

Start practising →

Original study material mapped to the public exam domains; not a real test question.Independent. Not affiliated with DLD, RERA or DREI. Verify figures and rules against current guidance before relying on them.