An Islamic bank in the UAE is demanding that property buyers pay for the registration of their mortgaged property - in name of the bank.
“I got a call this morning from my bank and was briefed on the handover process. The bank official told me that after I had made all the payments, the property would be registered in the name of the bank,” said an investor.
"Why should I pay even one per cent if the property title is not in my name. Whoever has the title deed should pay the registration fee. That is the law isn't it?" said an investor.
"When my payment is complete, the bank will transfer the property in my name and I will again be asked to pay the registration fees. Effectively, the bank is asking me to pay four per cent as registration fee for the same property," he said.
"Mine is an Islamic bank and a Shariah-compliant institution," he added. On Tuesday, 'Emirates24|7' had published two 'Fatwas' from two Grand Muftis of Dubai, stating that the Islamic banks' demand that clients pay the full two per cent property registration fee is 'illegal' and not Shariah-compliant.
The law states that both buyer and seller should each pay 1 per cent of the property sale price as the registration fee to the Dubai Land Department (DLD).
"Yes, my bank took two per cent from me instead of one per cent, even when I had signed cheques for only one per cent. They fleeced me by an additional amount of about Dh9,000," said MB, an investor.
On reading about the Grand Muftis' Fatwas, DD, another investor with mortgage from an Islamic bank, told this website: "Yes I just last week paid the amounts. Please advise what's the next course of action?"
Investors are not sure what to do as some have already paid the full two per cent DLD fee instead of the lawful one per cent. They are asking for a refund.
Now, an investor was told by a bank official that even though the client is being asked to pay the full two per cent registration fee, the property would be registered - not in the investor's name - but in the name of the bank.