Article 26 of the Saudi Registered Real Estate Mortgage Law
المادة 26 من نظام الرهن العقاري المسجل
The 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.
Official text (Arabic)
This article has not been amended since the law was issued.
للمرتهن حق تتبع العقار المرهون في يد أي حائز له لاستيفاء حقه منه عند حلول الوفاء به وفقًا لمرتبته.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 26 explained in plain English
This article establishes what is known as the right to follow the property, which is one of the most important effects of the mortgage being a right in rem attached to the property itself. It means the mortgagee may follow the mortgaged property into the hands of any possessor, so its right is not lost if the property passes from the mortgagor to someone else.
The article defines three elements of this right:
- Its object: the mortgaged property in the hands of any possessor.
- Its purpose: for the mortgagee to recover its right from the property.
- Its timing and limits: when payment of the right falls due, and according to the mortgagee's rank.
The practical result is that anyone who buys a mortgaged property or acquires a right in it receives it burdened by the mortgage, and the mortgagee remains able to recover its right from it when the term falls due. Article 27 explains who is regarded as a possessor: anyone to whom, after the mortgage, ownership of the property or any other right in rem in it that is capable of being mortgaged has passed, by any means, without being personally liable for the secured debt.
This article is connected to Article 25, which allows waiver of mortgage rank in favor of another mortgagee, since following the property is done according to rank. Anyone thinking of buying a property that is mortgaged must check the mortgages registered on it and consult a lawyer specializing in real estate and real estate finance cases.
Practical example
Badr bought land in Riyadh that was mortgaged to a financing provider, and the seller did not pay the debt when it fell due. The financing provider is entitled to follow the land into Badr's hands and recover its right from it according to its rank, even though he is not the debtor.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Lawyers who handle this kind of case
Dr. Ali Al-Rubaie Law Office and Ittihad Al-Asr Legal Company
Mohammed bin Saleh Al-Qarawi Law and Notary Office, Riyadh
Frequently asked questions about Article 26 of the Saudi Registered Real Estate Mortgage Law
If a mortgaged property is sold, does the mortgage lapse?
No. The mortgagee has the right to follow the mortgaged property into the hands of any possessor and recover its right from it when payment falls due, according to its rank.
When can the mortgagee use the right to follow the property?
When payment of its right falls due, and according to its rank.
More articles on Possessor of the Mortgaged Property and Clearing
- Article 27
The 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.
يعد حائزًا للعقار المرهون كل من انتقلت إليه بعد الرهن - بأي سبب من الأسباب - ملكية هذا العقار، أو أي حق عينيٍّ آخر عليه قابل للرهن دون أن يكون مسؤولاً مسؤولية ش
- Article 29
The 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.
لحائز العقار المرهون أن يؤدي دين الرهن والنفقات بعد إنذاره، على أن يرجع بما أداه على المدين، وله أن يحلّ محل الدائن الذي استوفى دينه فيما له من حقوق.
- Article 30
The 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.
1 - لحائز العقار المرهون حق تطهيره من كل رهن مسجل. 2 - يكون هذا الحق قائمًا للحائز حتى إجراء بيع العقار المرهون، وله أن يعود بما دفعه على المدين.
- Article 32
The 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.
يجوز لحائز العقار المرهون أن يدخل في إجراءات بيعه في المزاد، فإذا رسا المزاد عليه وأدى الثمن، عُدَّ مالكًا للعقار بمقتضى وثيقة ملكيته الأصلية، ويتطهر العقار الم
- Article 33
If 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.
إذا رسا مزاد بيع العقار المرهون على غير حائزه، فإنه يكسب ملكيته بمقتضى قرار رسوّ المزاد عليه، ويتلقى حقه من الحائز، سواء أدخل الحائز في المزاد أم لم يدخل.
- Article 35
The 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.
لحائز العقار المرهون أن يعترض على الدين الذي بيع العقار بسببه بجميع ما كان يجوز للمدين أن يعترض به إذا كان الدين مسجلاً بعد وثيقة ملكية الحائز.
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.