With over 31 mortgage lenders in the UAE, dozens of mortgage brokers and over AED 236 billion in property transactions last year, housing is big business and there is a world of choice when it comes to buying your dream home. Expats buying a property under AED 5 million must have a minimum deposit of 20%, rising to 35% for properties over AED 5 million. If you’re buying off-plan, you’ll need to put down at least half of the property’s value.
You’ll need to have your mortgage pre-approval in place before you can start hunting seriously – that way, you’ll know how much you can borrow and therefore what properties you can afford. Once you have your pre-approval, you have 90 days to complete the process before it expires.
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Mortgage terms extend up to 25-30 years, and you’ll need a salary certificate, original passport and copies, visa and Emirates ID, credit card statements and loan declarations and detailed bank statements for six months to initially apply. Your mortgage amount will be dictated by your salary and any existing debts and credit cards, with minimum salary expectations starting from around AED 6,000.
You’ll need to compare mortgage rates, loan-to-value ratios, early settlement and upfront fees. You can take advantage of fixed rate or variable fees, determine how long you want your repayment term to last and the flexibility to move between lenders. All banks and brokers will offer a different set of rates and fees depending on your circumstances, so make sure to compare and contrast to find the right one.
It’s vital you take into account the fees in the process – they can add an extra 5% to the total purchase price. Your bank will typically charge an arrangement fee of 1% of the mortgage, a valuation fee and an upfront processing fee. You’ll also need to have compulsory home and life insurance, and any extra fees if you’ve used a mortgage broker.