Court Orders Ramat Gan Seller to Refund 717,000 Shekels in Mortgage Dispute
A Bat Yam court ordered a Ramat Gan apartment seller to pay 717,000 shekels to a buyer forced to clear a mortgage twice. The judge ruled the seller breached the contract, reducing damages by 30% due to the buyer's negligence.
A Magistrate's Court in Bat Yam has ordered a Ramat Gan apartment seller to pay a buyer approximately 717,000 shekels after the buyer was forced to independently pay off a mortgage on the property despite having already transferred funds for that purpose. Judge Meital Ben Bast ruled that the seller fundamentally breached the purchase agreement, though the buyer was also found contributorily negligent, resulting in a 30% reduction of the compensation.
The dispute dates back to June 2019, when the buyer purchased the apartment for 1.76 million shekels, with the seller's brother signing the agreement as a guarantor. A mortgage of roughly 749,000 shekels encumbered the property. Under the contract, the buyer was required to remit the sum via a bank check directly to the lender. Instead, he transferred the funds to the seller's personal account. Within days, the seller transferred approximately 717,000 shekels of that money to her brother and various companies, including one registered in her mother's name. The mortgage remained unpaid.
When the bank initiated foreclosure proceedings in September 2025, the buyer paid an additional 756,000 shekels to release the property. In his lawsuit, the buyer sought full reimbursement of the amount paid to the bank, alongside 176,000 shekels in contractual liquidated damages and 70,000 shekels for emotional distress, alleging he was misled by being shown only the first page of the bank's payout letter.
The court acknowledged that a trust relationship existed between the siblings, but ruled this did not absolve the seller of liability toward the buyer. Under property law, a seller is obligated to deliver a property free of liens, an absolute responsibility independent of fault. The judge determined that the seller acted in bad faith and turned a blind eye, while the buyer was negligent in transferring funds to a private account and failing to secure a mortgage release confirmation before parting with the remaining balance. Consequently, the court ordered the seller to pay approximately 717,000 shekels in total, covering the mortgage repayment, contractual damages, and legal fees.
