Notarise realty transactions to combat fraud and protect buyers: MP

TDT | Manama

Email: mail@newsofbahrain.com

A proposal to notarise all real estate transactions has been tabled for parliamentary reviews, citing instances where properties were sold despite existing mortgages, leaving buyers unaware of the encumbrances.

The move aimed at curbing fraudulent activities in the property market covers preliminary contracts, and prohibits official bodies from accepting any property-related dealings without proper documentation.

MP Mohammed Al Ahmed said the proposal, if approved, will amend the Real Estate Registration Law

Al Ahmed’s proposal comes in response to a recent surge in cases where individuals have sold the same property multiple times through unofficial, installment-based agreements.

Accompanying memorandum highlighted instances where properties were sold despite existing mortgages, leaving buyers unaware of the encumbrances. These practices, it stated, have caused significant financial harm to those involved in real estate transactions.

The courts have witnessed a rise in cases involving the sale of a single property to multiple buyers on an installment basis using unauthorised preliminary contracts, the memorandum stressed, explaining: “Similarly, properties with existing mortgages have been sold without the buyers’ knowledge, leading to substantial losses.”

The MP argues that the current legislative gap has created an environment ripe for fraud and scams. He described scenarios where buyers, after years of making payments, discover the property is either mortgaged to a bank or has been sold to several other individuals who believed they were renting the property during that time.

Furthermore, the proposed amendment introduces a 15% discount on the registration fee if the notarised document is submitted within two months of notarisation.