Amlak to make payments linked to construction

Amlak Finance has adopted a construction-linked payment plan as against its earlier policy of paying developers according to payment schedules as per sales and purchase agreements (SPA), Emirates Business can reveal.

"We have been negotiating with developers for the past few months to switch from a payment plan as per the SPA, to a construction-progress payment. We have advised developers listed with us, that going forward, we will affect payments based on construction progress, or as per the revised payment plan approved by Real Estate Regulatory Agency (Rera)," said Arif Alharmi, Chief Executive Officer, Amlak Finance.

Rera is also said to be favouring construction-linked payment plans.

"The move will help safeguard customer interests and reduce their financial burden. Our overall liability will not reduce by switching over to construction-linked payment plan, it might just get delayed," added Alharmi.

The Shariah-compliant home finance company is also in talks with master developers to adopt a similar policy of payments for their own developments. The company will have its own engineers who will visit sites and provide reports, and will also take into consideration Rera's reports before making payments.

In a letter sent to customers, Amlak said that in case a customer receives any written communication from the developer of a financed property about non-receipt of payments, it will take up the matter with the authorities concerned. "We have been co-ordinating with the Dubai Land Department and Rera on this issue. We will protect our customers at any cost."

Although Amlak has not started lending for new projects, Alharmi said: "All will depend on the level of support that we receive from the federal government." He refused to comment further on what this federal support would be.

The future of Amlak and Tamweel, another Islamic mortgage company, has been under review by the federal government committee since November. Shares of both the companies have been suspended for trading since then.

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