Developers Offer Payment Relief to Homebuyers

Some of the biggest developers in Dubai are starting to offer more flexibility if buyers miss out on their next instalments on handed over properties. This means that if payments are missed, the developers will not immediately initiate legal action. In such cases, master-developer will take on the management of the property and collect rents from the tenant (if it is leased out). This effectively removes the ‘forfeit clause’ that developers enforce when payment schedules are not met. The developer will also work out ways to get a grip on the payment situation. If the property has been rented out, all cheques collected from the tenant will be handed over “without delay”. The developer will take over the responsibility of the property as soon as a payment default happens. It is then entitled to use any amount collected from the tenant to settle any late payment charges due under the SPA (sale and purchase agreement), any outstanding service fees, any payment to the authorities or utilities service providers. This way, the property owner will have more time available to get on track on the payments. The move comes as developers in Dubai put in place options if there were sudden increases in defaults.