Questions & Answers
If someone buys a home on installments but faces financial difficulties, what then?
Assalamo Alaikum,
If a person buys a home on installments after paying a 20% down payment but encounters financial difficulties after paying for a few months or less, what could be done in that case?
Will he go to jail? What if the person offers to take the property back?
Thank you!
Hello,
As per your query, please note that if there is any default of payment, then the developer shall send notice to terminate the contract and the contract will be terminated as per the clauses in the SPA (Agreement).
Please contact us by email or phone.
Walikom Assalam,
If a person buys a home on installments after paying a 20% down payment, but after paying for a few months or less, the person has financial difficulties, then he should immediately contact the seller and explain his situation.
He should request that the seller take back the property and cancel the contract. The seller may agree to this and cancel the contract, but the buyer may lose the 20% down payment that was made.
If the seller does not agree to cancel the contract, then the buyer should seek legal advice and try to negotiate a solution with the seller.
If the buyer is unable to make the payments and does not come to an agreement with the seller, then the seller may take legal action to recover the remaining payments.
This may result in the buyer being ordered to pay the remaining amount or the property being repossessed and sold to recover the outstanding amount.
In general, defaulting on payments does not result in jail time in the UAE. However, if the buyer has signed a post-dated cheque as part of the payment plan and it bounces, then this could result in legal action and possible jail time.
It is important for the buyer to communicate with the seller and try to come to a mutually beneficial solution to avoid any legal issues.
Kindly do not hesitate to contact us via email or phone for further guidance on your specific case.
Regards,
Walikom Assalam,
If a person is unable to continue paying installments for a property, they should first try to negotiate with the seller or developer to come to an agreement on how to proceed.
This could include extending the payment period, reducing the installments, or even returning the property to the seller.
If the seller agrees to take back the property, the buyer may still be responsible for any outstanding payments or fees, such as interest or penalties.
However, if the buyer is unable to come to an agreement with the seller, they may face legal action and potentially be taken to court.
In general, defaulting on payments for a property does not automatically result in jail time. However, if the buyer has signed a contract that includes a clause for criminal liability in case of default, they may face legal consequences.
It is important for buyers to carefully review their contracts and seek legal advice before making any decisions regarding their property.
It is also recommended to communicate openly and honestly with the seller or developer to find a solution that works for both parties.
