A mortgage is a contract under which a creditor is granted a real right over immovable property or a real property unit. The mortgage secures the repayment of the underlying debt. These creditors obtain preference over ordinary creditors and creditors of lower priority. Mortgages create proprietary rights; therefore, they must generally be registered with the competent authority to be enforceable.

The laws governing mortgages are:

  1. Law No. 14 of 2008 Concerning Mortgages in Dubai.
  2. Federal Decree-Law No. 25 of 2025 Promulgating the Civil Transactions Law.

When Can a Mortgagee Commence Foreclosure Proceedings?

Due to multiple reasons, especially recent geopolitical situations, many people have been unable to make payments, resulting in defaults. Under Article 25 of the Dubai Mortgage Law, a mortgagee may commence foreclosure and forced sale proceedings if the debtor defaults on the repayment of the debt or if the condition requiring early repayment has been fulfilled.

The 30-Day Notice Requirement

  1. The mortgagee cannot immediately initiate enforcement proceedings upon the occurrence of a default.
  2. The mortgagee has an obligation to serve a notice of at least 30 days through the Notary Public to the debtor or the person in possession of the mortgaged property. The notice period provides the borrower with an opportunity to settle the outstanding debt and avoid further legal action.
  3. The right to initiate foreclosure proceedings is also extended to the mortgagee’s successors, ensuring that the security created by the mortgage remains enforceable notwithstanding any transfer of rights.

What Happens if the Borrower Fails to Repay the Debt Within Thirty Days?

  1. If the debtor-mortgagor or his successors fail to pay the mortgage amount after the 30-day notice period, the mortgagee can apply to the execution court.
  2. Upon the application of the mortgagee, the execution judge may issue an attachment order against the mortgaged property to facilitate its sale by public auction in accordance with the procedures of the Dubai Land Department.

Can the Borrower Request Additional Time Before the Property Is Sold?

  1. Article 27 allows the debtor or the real surety to request the execution judge to postpone the sale by public auction.
  2. The postponement can only be granted once, and it cannot exceed sixty days.
  3. The extension will only be granted if the following conditions are satisfied:
    • the debtor can repay the debt within the grace period; or
    • the immediate sale of the property would cause substantial financial loss to the debtor.

When Will the Property Be Sold by Public Auction?

In the event of failure to repay the debt amount within the specified period, the mortgaged property will be sold by public auction in accordance with the procedures of the DLD within 30 days from the date of expiry of the notice period or grace period.

The Role of the Dubai Land Department

The Dubai Land Department oversees the procedures relating to the sale of mortgaged properties through public auction. Once the execution judge issues an attachment order, the property is sold in accordance with the applicable procedures and regulations of the Dubai Land Department.

Conclusion

Mortgage enforcement in Dubai is governed by a structured legal framework that seeks to balance the interests of both lenders and borrowers. Although mortgagees have the right to initiate foreclosure proceedings in the event of a default, they must comply with statutory notice requirements and obtain judicial approval before a property can be sold. Borrowers are also afforded certain protections, including the opportunity to seek a temporary postponement of the sale.

We at Ayesha Al Dhaheri Advocates and Legal Consultants, we regularly advise and represent clients in matters relating to mortgage defaults and enforcement proceedings in the UAE.