UAE is a rapidly growing global economic powerhouse. Its real estate market has been thriving and plays a crucial role in the development of the country. Due to this, the government has taken a keen interest in ensuring hassle-free and smooth property transactions. One of the developments that have been introduced to facilitate this is the use of power of attorney for real estate transactions. A property Power of Attorney (POA) is a legal document through which a principal authorizes an agent to carry out property-related tasks on their behalf. Here are the things you must know about real estate POA in UAE.
Benefits of Power of Attorney in Real Estate Transactions
The use of power of attorney in real estate transactions is extremely used as it offers the following advantages:
Convenience for Investors: Many investors in the UAE are based outside the country or may not have the time to personally follow up and complete the process of transferring real estate. Property Power of attorney allows them to appoint an agent to handle the transaction on their behalf.
Smooth Transaction Process: Granting power of attorney to registered brokers has eliminated the need for physical presence and allows sellers to take advantage of instant deals, ensuring a smooth transaction process.
Professional Handling: Appointing a legal real estate POA service provider that can handle the tasks involved in the sale and transfer of real estate properties are handled professionally on behalf of the owner.
Provide multiple powers: A property POA in Dubai can be customized to suit the specific needs of the principal. The powers granted can include managing, leasing, and selling the property, as well as representing the owner before government departments and utility providers.
Requirements and Considerations Regarding Property POA in Dubai
There are certain requirements and considerations to keep in mind while using poa for property in the UAE:
Drafting and Legalization: It is important to ensure that the property POA in Dubai is drafted clearly and professionally. It must follow the standards accepted in the UAE. It should be prepared by experts familiar with UAE laws.
Presence during Finalization: The Dubai Land Department suggests that the original parties must be present when finalizing the documents for real estate transactions, especially during the sale of a property. This is to prevent fraudulent activities.
Legal Representation: Foreign investors can designate a local representative such as a trusted attorney-in-fact to handle property transactions. This can simplify processes and ensure compliance with local legal rules.
Understand the Types of Powers of Attorney: In the UAE, there are different types of powers of attorney, including general, personal, and special powers of attorney that can be used for property-related transactions. A general power of attorney grants broad powers to the agent to act on behalf of the principal in various situations. A personal power of attorney is given by an individual to someone, granting general or specific powers to the agent. A special power of attorney authorizes an agent to act on behalf of the principal in specific situations only.
Prepare the Power of Attorney: The POA for property must be primarily in Arabic or have an official translation into Arabic if it is issued outside the UAE but will be used within the country. It is recommended to seek legal drafting services in the UAE to ensure the POA is prepared correctly.
Notarize the Power of Attorney: The POA for property needs to be reviewed by a Notary Public and stamped as a legal document after paying the applicable attestation fees. If the POA for property is issued outside the UAE but will be used within the country then it should be notarized first and then translated into English or Arabic. Later, it will be legalized by the UAE Embassy and Department of Foreign Affairs in the UAE.
Risks Associated with Issuing a Real Estate Power of Attorney (POA) in Dubai
There are certain risks that are associated with property POA in Dubai. They are as follows:
Limited Power: A Special Power of Attorney is commonly used for real estate transactions. However, it gives limited power to the nominee. It is usually provided for one-time issues such as signing a contract on a person’s behalf.
Different Regulations: Different Emirates in the UAE may have different regulations for issuing a POA. It is important to check the government websites for the latest updates and specific requirements.
Risk for the Grantor: The general durable POA allows an agent to buy and sell real estate, conduct financial business, and pay bills on behalf of the grantor. It carries the most risk for the grantor. This type of POA remains binding even if the grantor passes away or becomes incapacitated.
Legal and Financial Liability: Granting a property POA in Dubai to a close family member or spouse can create legal and financial liability. It is advisable to consider creating a limited POA or a trust for assets and real estate managed by third parties to avoid potential risks.
Role Of POA For Property
Following are the roles of POA for property in the UAE:
- Sale of Property
- Manage rental properties including negotiating leases, collecting rent, and handling tenant related matters.
- Handling mortgage related matters including applying for a mortgage, making mortgage payments or refinancing.
- Paying property taxes and dealing with the related financial matters.
- Arranging property repairs and maintenance.
- Handling utility bills and related matters.
- Transfer property ownership on behalf of the principal.
- Handling property-related legal matters like lawsuits and disputes.
- Property insurance matters like filing claims and receiving settlements.
Conclusion
A property POA in Dubai is a legal document to handle the property related matters in the UAE. The property POA in Dubai must be clearly drafted keeping the legal compliances in mind. A good real estate POA provider like MyPOA can help to draft a relevant and professional POA in minimum time possible