The Dubai Land Department (DLD) takes the initiative to protect the interests of all parties engaged in property transactions. One instance of this is an escrow account for real estate developers. It preserves buyer installments and controls the account until the project is completed and handed over. However, real estate developers might seek an escrow account transfer if the project is delayed or if they wish to finance it directly.
However, developers must request an escrow account transfer in Dubai. Here is the whole way and terms and conditions for moving escrow accounts.
ESCROW ACCOUNT TRANSFER APPLICATION IN Dubai
An escrow account, which is governed by the Real Estate Regulation Authority (RERA), allows buyers to pay off-plan project payments. Following the signing of the purchase agreement, buyers have many off-plan property payment options in Dubai.
These programs provide installment alternatives. Buyers can send the funds to the developer’s escrow account. Furthermore, developers can transfer their escrow account and advise buyers of the new account number. However, they must request an escrow account transfer in Dubai.
TERMS AND CONDITIONS
When real estate developers in Dubai apply for an escrow account transfer with DLD, they must satisfy the following conditions:
- The project must be in the development stage and have an active status.
- Developers must have a DLD technical report from no more than four months ago.
- There must be no red flags among the project’s completed milestones.
- The escrow account transfer must be for the purpose of direct funding.
- Formal provisional permission must be granted for financing.
- When developers request an escrow account transfer in Dubai, they must transfer all of the previous account’s information, papers, and financial data to the new account.
- To start a new account, the trustee must file a No Objection Certificate (NOC).
- A written assurance must be presented stating that the account will be open for at least three months and no more than one year.
- Developers must sign another agreement to transfer the collected monies from the previous account to the new trustee.
- The trustee of the new account must file a no objection certificate (NOC).
- An agreement must be signed to keep the project’s escrow account inactive until all transactions and fund transfers from the preceding account are finished.
- All assets must be moved from the previous escrow account to the new one within three business days.
- RERA must authorize the new escrow account.
PROCEDURE
Because no documents are necessary, the procedure of applying for an escrow account transfer with DLD in Dubai is simplified. Here are all of the steps:
- Log into the Oqood Portal.
- Choose the escrow account transfer service and submit your application.
- The trustee will get an application from the old account, which will be transferred.
- This application will be sent.
- An escrow account application audit will be performed.
- After approval, developers can utilize the new escrow account following the transfer.
FEES
The application is submitted using the Oqood site. Furthermore, there is no fee to apply for an escrow account transfer through DLD in Dubai.
FAQS
IS THERE ESCROW IN DUBAI?
Yes. DLD established escrow accounts in Dubai to protect the interests of purchasers and developers in off-plan property sales and purchase agreements.
WHO OWNS THE MONEY IN THE ESCROW ACCOUNT?
The property buyer has the right to the money in the escrow account. In the event of an off-plan project delay, a buyer may terminate their sales and purchase agreement and receive money.
HOW CAN I OPEN AN ESCROW ACCOUNT IN DUBAI?
To establish an escrow account, a real estate developer must provide the following documents:
- Membership certificate in the Dubai Chamber of Commerce and Industry;
- Developer’s trade licence
- Title deed
- Contract copy between the developer and sub-developer
- Approved initial architectural designs and engineering plans
- Certified financial statement of the project
- An undertaking to start the work as soon as the off-plan property sale is registered
- Sale-purchase contract between the developer and the purchaser
This was all about how to apply for an escrow account transfer in Dubai. When you buy an off-plan property in Dubai, you must pay the installments into the developer’s escrow account.
