In force
Saudi Registered Real Estate Mortgage Law
نظام الرهن العقاري المسجل
The law covers creating the mortgage, its effects (on the mortgagor, the mortgagee, third parties, priority and the right of pursuit), and termination of the mortgage.
- Articles
- 46
- In force
- 46
- Amended
- 0
- Issued
- 13/8/1433 AH
Issued by: مرسوم ملكي رقم م / 49 بتاريخ 13 / 8 / 1433
Each article shows the official Arabic text, which is the only legally binding version, followed by our plain-English explanation.
Browse Registered Real Estate Mortgage Law by topic
Defining and Registering Real Estate Mortgage3 articlesMortgagor and Mortgaged Property Conditions4 articlesMortgaging Jointly Owned Property3 articlesDebt Secured by the Mortgage4 articlesRights and Duties of Mortgagor and Mortgagee6 articlesLoss of the Mortgaged Property or Fall in Its Value2 articlesMortgage Rank and Multiple Mortgagees5 articlesEnforcing Against the Mortgaged Property9 articlesPossessor of the Mortgaged Property and Clearing8 articlesEnding and Releasing the Mortgage8 articles
Articles of the Saudi Registered Real Estate Mortgage Law
- Article 1The Article defines the registered real estate mortgage as a contract giving the creditor an in rem right over a registered property that ranks him ahead of other creditors, and explains how it is registered and who bears its costs.
- Article 2The Article requires the mortgagor to own the property and have capacity to dispose of it, and permits the mortgagor to be the debtor or a real surety who mortgages his property for the debtor's benefit.
- Article 3The Article makes a non-owner's mortgage suspended pending a documented ratification by the owner, with the mortgage starting from that date; absent ratification, it takes effect only once the mortgagor acquires the property.
- Article 4The Article requires the mortgaged property to be specific, existing or likely to exist, known and stated in the contract and saleable at auction, and permits mortgaging the property's usufruct separately from the property.
- Article 5The Article provides that the mortgage covers the mortgaged property's appurtenances, namely buildings, plantings, what is prepared to serve it and what is added after the contract, unless otherwise agreed and without prejudice to third parties' rights.
- Article 6The Article provides that a mortgage granted by all the owners of a commonly owned property remains effective, whether or not the property can be divided.
- Article 7The Article sets what happens to a partner's mortgage of his undivided share after division: it converts to the separated part in his share or to an equivalent amount set by the judge, and his entitlements are applied to repay the debt.
- Article 8The Article bars the mortgagee in a jointly owned mortgage from requesting division before his right of collection is established, except with the mortgagor's consent, and allows him afterwards to request a sale of the undivided share or division.
- Article 9The article sets out what a mortgage can secure: an established debt, a specified promised debt, a specific item guaranteed by the debtor, or a debt that will become due. The contract must state the amount of the debt or its maximum limit.
- Article 10The article sets the principle that a mortgage is indivisible: every part of the property secures the whole debt, and every part of the debt is secured by the whole property, unless otherwise agreed.
- Article 11The article allows dealing with a mortgaged property that is registered under the Real Estate Registration Law, and prevents the mortgagor from dealing with an unregistered one unless an agreement is documented in its deed and record.
- Article 12The article gives the yield, upkeep and management of the mortgaged property to its owner without prejudice to the mortgagee. The yield is not mortgaged unless the mortgagee requires it, and the parties may agree to settle due debt from it.
- Article 13The article obliges the mortgagor to preserve the mortgaged property until the debt is paid, and lets the mortgagee object to anything that reduces its value, take lawful precautionary measures, and recover the costs from the mortgagor.
- Article 14The article sets out the mortgagee's rights when the mortgaged property loses value, is destroyed, becomes defective or is reclaimed, and distinguishes between transgression, negligence or fraud by the holder of the property and other causes.
- Article 15The article limits enforcement against a real surety, who is not the debtor, to the mortgaged property alone, and lets the owner claim against the debtor after the property is sold but not before enforcement against it.
- Article 16The article lets the mortgagee ask the court to stop works that expose the mortgaged property to destruction or defect or make it insufficient as security, under the rules of urgent judicial proceedings.
- Article 17The article lets the mortgagee transfer its right to collect the debt, together with the mortgage that secures it, to another person, subject to the rules on dealing in debts, unless otherwise agreed.
- Article 18The article requires the debt to be paid when it falls due. If the debtor pays, the debtor takes back the property; if not, it is sold at the mortgagee's request and the mortgagee takes priority by rank, then shares in the debtor's other assets for any balance.
- Article 19The article invalidates two conditions in a mortgage contract: that the mortgaged property's benefits go to the mortgagee, and that the mortgagee acquires the property if the debt is not paid on time. The mortgage stays valid.
- Article 20The article states when a lease granted by the mortgagor of a property registered under the Real Estate Registration Law binds the mortgagee, and requires the mortgagor of an unregistered property to disclose rights in rem in the contract.
- Article 21The article provides that the effect of a registered mortgage applies against third parties from the date of its registration, unless the third party acquired a right in rem on the property before the mortgage was registered.
- Article 22The article confines the effect of the mortgage to the debt specified in the mortgage document, so it does not extend to other debts not mentioned in it.
- Article 23The article provides that transferring a debt secured by a registered mortgage, or waiving its rank, can be invoked against non-parties only after being recorded in the original mortgage document and the property record.
- Article 24The article permits a registered property to be mortgaged to several mortgagees in succession, fixes rank by registration number and date until its extinction is recorded, and pays their rights from the price according to rank.
- Article 25The article lets a mortgagee waive the rank of its mortgage, to the extent of its debt, in favor of another mortgagee on the same property, under the rules on assignment of rights.
- Article 26The article gives the mortgagee the right to follow the mortgaged property into the hands of any possessor, to recover its right from it when payment falls due, according to its rank.
- Article 27The article defines the possessor of a mortgaged property as anyone to whom, after the mortgage, ownership or another mortgageable right in rem in the property has passed, without personal liability for the secured debt.
- Article 28The article lets the mortgagee begin compulsory expropriation and sale of the mortgaged property if the debtor does not pay by the agreed time, after notifying the debtor and the possessor in accordance with the Enforcement Law.
- Article 29The article lets the possessor of a mortgaged property, after being notified, pay the mortgage debt and expenses and then have recourse against the debtor, stepping into the creditor's rights.
- Article 30The article gives the possessor of a mortgaged property the right to clear it of every registered mortgage, which remains until the property is sold, and to have recourse against the debtor for what was paid.
- Article 31The article refers the procedures for compulsory expropriation and sale of the mortgaged property, when the debt is not paid, to the Enforcement Law.
- Article 32The article lets the possessor of a mortgaged property enter its auction; if the possessor wins and pays the price, the possessor is regarded as owner under the original ownership document, and the property is cleared of every registered right.
- Article 33If the auction of a mortgaged property is awarded to someone other than its possessor, that person acquires ownership under the decision awarding the auction and receives the right from the possessor, whether or not the possessor entered the auction.
- Article 34If the price of the mortgaged property exceeds the value of the registered debts, the excess belongs to the owner.
- Article 35The possessor of a mortgaged property may object to the debt for which the property was sold, with everything the debtor could have objected with, if the debt was registered after the possessor's ownership document.
- Article 36The article lets the possessor bring a warranty claim against the previous owner and have recourse against the debtor for what was paid in excess of what is due from the possessor, stepping into the rights of the creditors who were paid.
- Article 37The mortgage follows the debt, so it is released when the whole secured debt is extinguished and returns if the debt returns, without prejudice to rights acquired in good faith by others in between.
- Article 38On early repayment of the debt or part of it, a part of the debt is deducted under the early repayment standards in the Finance Companies Control Law; if the court sells the property before the term ends, it pays the due installments to the creditor and deposits the rest in its bank account.
- Article 39A registered mortgage is extinguished by a compulsory sale of the mortgaged property under the law and payment of the price to the mortgagee creditors according to their ranks, or its deposit in a bank account of the court.
- Article 40A registered mortgage is extinguished by merger of rights, when the right of mortgage and the right of ownership come together in one person, and returns if the cause of the merger ceases retroactively.
- Article 41A registered mortgage is extinguished when the mortgagee waives it by a documented waiver, and the mortgagee may waive the mortgage right while the debt remains.
- Article 42A registered mortgage is extinguished by the destruction of its subject, subject to the provisions on destruction of the mortgage set out in the law.
- Article 43The mortgagor and the possessor may request release of the mortgage after the period for hearing a claim on the debt secured by the mortgage, set out in other laws, has elapsed.
- Article 44A mortgage is not void on the death of the mortgagor or the mortgagee or on loss of capacity: the heir takes the place of the deceased, and the guardian acts for the one who lost capacity.
- Article 45The competent court decides disputes arising from the application of the provisions of the Registered Real Estate Mortgage Law.
- Article 46The Registered Real Estate Mortgage Law takes effect ninety days after the date of its publication in the Official Gazette.