Dubai Mortgage

Mortgage Eligibility Criteria For Property Buyers In Dubai

Where To Start!!

International investing can be confusing. The reason for this confusion is that there are a lot of different requirements, business nuances, and other factors that make it hard to know where to begin and which path to take.

For example, the best place to start would be to hire an experienced and reputable estate agent to help you. They will tell you that if you already have rental income only 40% of that income will be counted while 100% of the liability will be factored into your eligibility criteria.

But there is more involved in meeting mortgage eligibility criteria when you want to buy property in Dubai.

Dubai Mortgage Eligibility Criteria

1. Financial Health

This is a vital criterion you need to meet. Before you make an offer, you need to build your credit score as well as look at your income and monthly expenses. Your monthly expenses, including the Dubai mortgage payment, should not be greater than 33% of your monthly income.

Also, you will need to have saved up roughly 20% of the purchase price for a down payment. While you are saving, look for ways to cut your debt.

2. Documentation

When you want to purchase real estate anywhere in the world, you need to provide the right documents to be approved for a mortgage loan. The following documents are required by lenders before they will consider your loan request:

  • A copy of your visa and passport
  • A copy of your Emirates ID
  • A salary certificate for proof of employment
  • Proof of residence (copy of tenancy contract or DEWA bill)
  • Pay slips and bank statements for the past six months
  • The latest statements of your credit cards
  • A copy of your passport
  • Bank statements for the past three months (non-resident)

The required documents will vary among lenders so take the time to shop around, not only for the best mortgage rates but also for lesser red tape.

3. Mortgage Lenders

It does pay to shop around as one of the bigger mistakes in finding a good mortgage is going to your current bank. It is possible to do better than what your bank offers.

But when you do shop around, use a reputable broker. They will have all the facts and other information on mortgage products from the 18 banks in the UAE/Dubai region.

When you pick the best options, consider moving your income deposits to that bank. This move often allows the borrower to receive preferential rates. That will lower your mortgage costs

As you shop, you should decide if you want a fixed, variable or Islamic mortgage. Each type of mortgage option has its own criteria for you to meet.

4. Selecting The Property

After receiving pre-approval for a mortgage loan, it is time to shop for a home in the right neighbourhood. This is where selecting a reputable and qualified real estate broker can help you.

The more experience the agent has the better it is for you. They know the best places to buy as well as the market trends in those neighbourhoods. Getting sound advice from your estate agent can save you a lot of trouble down the road.

Make sure you do your research and learn all the applicable real estate purchase and investment laws. Then make sure you observe those laws throughout your transactions.

Plus, learn and understand your legal obligations. If you don’t, then you may experience some hardship after you make your purchase.

6. Approval & Disbursement

Once the purchase has been approved, the mortgage money will be dispersed. The key criteria at this point is to make sure your purchase is duly registered with RERA and the DLD government organizations.

When everything is completed, you own your new property in Dubai.

The Down Payment Criteria

While it was stated earlier that you only need 20% of the purchase price for a down payment, that is only part of the story. A 20% down payment is required for all property purchases that are priced at 5,000,000 AED or lower.

If you want to purchase a property for 5,000,000 AED or above, then you will need to have a 35% down payment ready. Dubai and UAE citizens are only required to pay 15 and 30% respectively.

If you already own property in Dubai, then your down payment requirement will go up to 40%.

How To Find A Mortgage Lender

The mortgage broker will have the information about each lender but it pays to know what to look for to protect yourself and your investment dollars. Here are the criteria to follow when looking for a mortgage lender;

  • Interest rates
  • Loan terms
  • Fees
  • Customer reviews of the bank

Take the time to compare and ask the right questions. One of those right questions will be, ‘Can you get a lower interest rate if you start depositing money into the bank?’

Finding small ways to save money can add up and lowering your interest rates can add up to some substantial savings. When you are shopping around, make sure to boost your credit score to 700 or higher.

There may be some flexibility on that score depending on the bank or lender, but just in case, make sure your credit score is healthy. Once you submitted all the documents and met all the criteria, then you should get approval in about 10 working days, depending on the lender.

The key is to make sure everyone you work with is registered with RERA otherwise you may have problems.

Some Additional Words

When you are looking to buy property in Dubai, call our estate agency. Our experienced and qualified Dubai estate agents can help you meet all mortgage criteria. They know what is needed, who to work with, as well as how to submit all your documents.

Call today and put their experience to work for you and your financial future. Buying in Dubai does not have to be confusing or difficult. Our agents will keep the process running smoothly.

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