Regulatory Alerts2020-08-12
Real estate valuation fees in mortgage contracts for individuals
The Saudi Central Bank issued a circular requiring financing entities to withhold real estate valuation fees from individual customers until initial mortgage approval is granted. The directive mandates that lenders explicitly inform borrowers before contract execution that they forfeit the right to a fee refund if financing approval fails due to customer-related reasons, and must obtain written acknowledgment. This measure enforces fairness and transparency by preventing premature fee deductions and clarifying refund eligibility.
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