How to Get a Mortgage in Dubai
One can buy a property in Dubai for residency or investment purposes either on a cash or mortgage basis. Cash deals are relatively less expensive while mortgages allow for greater control over your finances. Here is a step-by-step guide on how to secure a mortgage in Dubai based on eligibility criteria, required documentation, and a step-by-step process to acquire financing. You can purchase a property in Dubai for residency or purely for investment purposes on cash or on mortgage. A cash deal is relatively inexpensive, and a mortgage gives you more control over your finances. First comes the eligibility criteria for this, followed by required documentation then a step-by-step process to avail financing.
Need for a Mortgage in Dubai
Residency
Any UAE resident or non-resident can get a mortgage. A non-resident will have less mortgage loan choice and most big banks will not lend to him with the majority maintaining Loan to Value (LTV) ratios.
Age
The age of the borrower upon the maturity date of the loan should range from 21 to 65 years. In certain cases, banks are prepared to extend the upper age to 70 years, depending on the specific situation of the applicant.
Type of Employment
It is open to both salaried and self-earning persons. But, in terms of the requirements and other needed documents, these may vary according to their employment status.
Need for a Mortgage in Dubai
You will need the following list of documents to submit at the bank so that you get a mortgage. The needs are different, but this is the common list of documentation. Emirates ID, Copy of passport, and Visa Income proof-it can be a certificate of salary and payslip in case of salaried or audited financial statement in the case of individuals. Bank statements Usually most for at least 6 months. Proof of Residence is tenant contract or utility bill from DEWA. Credit Card Statements are the Recent statements of open credit cards.For international it would be easy Copy passport. Bank Statements are Usually three months’ statements.
Options for Home while obtaining home loan
At the time of selecting a home loan, at present no one should know what types of home loan are there in Dubai. Fixed Rate Mortgages provide fixed rate of interest on a product by an agreed term through regular monthly payments. Variable-Rate Mortgages are The interest rates change according to the market fluctuation. You can save money if the interest rate falls, but you become more susceptible to paying more when the interest rate increases. Fixed- Versus Variable-Rate Mortgages areThe choice between fixed and variable depends on your financial stand and forecast in the market.
How to Obtain a Mortgage in Dubai
This is how you can get a mortgage loan:
Find a Lender
You will find mortgages offered by several banks available in Dubai. This is a regulated product; mortgage deeds have to be registered with DLD to receive legal recognition, so you have either to apply directly to the bank or to a mortgage broker that understands the local markets and is ready to give you beneficial advice. You can opt for a home loan keeping in consideration all the parameters of property type, the amount of borrowing, the sum deposited, your income, and lifestyle. Most of the bank websites introduce online calculator tools that would help you figure out your monthly instalment and rate of interest.
Prepare Pre-Approval Letter
Pre-approval letter from the bank would allow you know how much is eligible, what is the borrowing limit. The whole procedure takes 3-5 working days, depending on the delivery. It provides better bargaining power while choosing your dream house.
Finalize Your Property
With a pre-approved budget in hand, you can now look for properties with confidence. Pre-approvals usually are valid for 60 to 90 days, which gives you ample time to find a home.
Finalize the Purchase
The bank will then appraise the chosen property before granting the loan. Once you have agreed on the selling price with the seller, you can now pay for the deposit and agree on the completion date for the transfer. At the time of completion, the bank will unlock the flow of funds to the seller.
Mortgages for Non-Residents
Non-residents have fewer mortgage options but some banks offer customized loans. Normally, non-residents can borrow up to 50-60% of the value of the property depending on the bank’s policies. The process will be subjected to more rigorous examination due to the perceived risk.
Refinancing and Switching Mortgages
With its ability to refinance or switch mortgage deals, the UAE is a competitive market: first, talk to your current lender for better terms of swapping or approach other banks for new offers as some charge a fee of up to 1% on the remaining balance for switching.
Conclusion
Dubai mortgages open the door to owning your own property in one of the most exciting real estate markets, but there are certain criteria to be met and documents needed, which may incur certain costs. Broker services or programs like ADCB’s Dream Home make it more straightforward.