Acquisition of Real Estate Finance Assets or Rights Arising from Mortgage Finance Companies
| No: 381000061976 | Date(g): 7/3/2017 | Date(h): 9/6/1438 |
Translated Document
Referring to SAMA Circular No. 381000039082 dated 10/04/1438 H regarding the increase of the maximum LTV on real estate finance granted by banks and exchangers to citizens to own their first home, and SAMA Circular No. 371000064719 dated 07/06/1437 H regarding the acquisition of financing assets from real estate finance companies or the rights arising from those assets, and given that some banks are contracting with real estate finance companies to acquire real estate finance assets or the rights arising from those assets.
I would like to inform that there is nothing preventing a bank from acquiring real estate finance assets or rights arising from such assets in cases of disposal without recourse or with partial recourse in contracts for the first home financing for citizens, provided that the amount of the existing financing for the assets (or the rights arising from them) upon acquisition does not exceed (85%) of the value of the home, while stressing that the compliance with Circular No. 371000064719 dated 07/06/1437 H should continue when acquiring real estate finance assets or rights arising from them for financing contracts other than for citizens’ first homes.