Whatever your reasons might be for looking for a property in UAE, understanding the type of mortgages available and the steps needed to get one set up is highly important, therefore, below mentioned is a beginner’s guide of how to apply for a mortgage in UAE? This handy guide covers the banks that offer mortgages and home loans in UAE to non-residents, the paperwork you’ll need to get your loan, the legal ins and outs, and what it might cost. Continue reading to find out more…
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What are the required documents to get a mortgage in UAE?
To apply for a mortgage loan in Dubai or any of the other Emirates of the UAE, you would be required to submit the following documents:
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- Application Form: The first required document is the application form for the personal loan.
- ID Proof: Applicants are mandatory to have valid ID proof, that is, a passport, visa, and an Emirates ID.
- Residency Proof: To avail a personal loan in the UAE, you will also be required to present valid proof that you are a resident of the UAE.
- Bank Statement: Lenders usually ask for a bank statement of the last 3-6 months to track your earning potential.
- Salary Certificate: A salary certificate needs to be presented as it lets the lender know of the current financial status of the borrower before the loan is granted.
- Trade License – If you are self-employed, you will also require a trade license to apply for a mortgage loan in UAE.
The documents required for a mortgage is almost the same for nationals and expatriates, other than some identity proofs. Expatriates are supposed to provide their passport and the UAE resident visa for verification and a photocopy of each along with the other required documents like Emirates ID, salary certificate, trade license, bank statement, and some more additional documents according to the applicant’s profile.
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What is the procedure that needs to be followed to get a mortgage in UAE?
Given below is a step-by-step guide explaining the process of applying for and getting a mortgage in UAE. The main steps are as follows:
- Decide whether to approach the bank directly or use a broker.
- Do your research to find the right type of mortgage for your circumstances.
- Obtain an agreement in principle from the bank and ask for a letter providing evidence of the same.
- Find a suitable property within your budget and make an offer.
- Once you have agreed on a price, pay your deposit to confirm your purchase and agree on a completion date.
- Provide any additional documentation needed to confirm your mortgage, including searches on the specific property you have chosen.
- Finally, on the completion date, the mortgage lender will release its funds.
What should be the minimum wage of an individual to apply for a mortgage in UAE?
Each bank in the UAE has a minimum monthly income/salary criterion. The criterion is different for expatriates and nationals. At some banks, the criteria are different for self-employed and salaried individuals as well. Most banks approve adding the spouse as the co-applicant. If the co-applicant is a salaried individual, your application can meet the eligibility criteria easily and improves the chances of loan approval as well.
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There are more than 30 lenders in Dubai, however, some won’t offer a loan to expats or non-residents. Foreign lenders are only allowed to do business in the UAE if they are recognized by the central bank. Those who aren’t recognized cannot place an application for a mortgage. However, there are a few expat-friendly lenders in the UAE, some of which are as follows:
- HSBC – HSBC is a global banking giant that offers mortgages to buyers with minimum earnings of at least AED 15,000 a month. Mortgages are only available on selected developments.
- Mashreq – Mashreq is a UAE-based bank offering loans to residents and expatriates. Home loans are available to both employed and self-employed expat residents earning at least AED 15,000 a month at a value of up to AED 10 million.
- Emirates NBD – Emirates NBD is a lender owned by the Dubai Government that offers mortgages of up to a maximum of AED 15 million. Mortgages are offered up to 75% loan-to-value, and a pre-approval facility is available.
Buying a new place of residence for yourself or for your family can be a big step. It can be even more daunting if you are an expatriate and are looking to buy a place in a new country. But as long as you are in a decent financial position, you should be able to easily get a mortgage that suits your needs. Keep in mind, though, that you will need a large cash amount upfront to pay a deposit. It is key to do your research well so that you do not struggle to get a deal that works for your circumstances.