Buying a new home is everyone’s dream at present. But not all can afford that lump sum amount at a time, so you are supposed to apply for a mortgage but wait,
Are you getting the best mortgage rates in UAE ?
Getting the best mortgage rate in UAE will need some homework like for buying a product. Your mortgage rate is a big deal. On lowering your interest rate a percentage point or two, which can help you save hundreds or thousands of dirhams as this tenure of the loan will last for 20 to 30 years.
In the UAE, Home financing has become a competitive market for banks. So before you shop for a mortgage it is Important compare with multiple banks which will let you get the best deal that suits your financial needs. In this article, we will discuss some tips to get the best rate on your mortgage
Improve Your Credit Scores
Your credit score is a major factor that determines whether to lend you a loan and at what rate. The higher your credit score, the lower your rate will be. (more chances to get approved ). The banks will look into your credit score to evaluate your creditworthiness.
So keep your credit report clean without any red flag. make sure you’re spending no more than 20 to 30 per cent of your available credit limit, not carrying credit card debt and paying all your bills on time.
You can review your credit score by pulling your scorecard from AECB. Pulling your free credit scores will not harm your score. You can also get an annual credit report by applying on AI Etihad credit bureau where you need to pay some fee and can get your report.
Avoid applying for any new loans or credit cards.
If you are serious on getting a new home then this the time that you need to keep an end to extra expenses. Stop taking new loans like auto loans for the car prior at the same time when you want to raise a mortgage on the home. Some banks will not take you as a serious mortgage customer on checking your credit report with a lot of credits. So all your efforts go in vain.
Have a record of employment
Banks will also consider risk in lending money if you cant show steady employment at least two year and earnings, especially from the same employer. So don’t jump into other jobs just because you can.
Make some downpayment
You can get the best deal on your mortgage if you put more money down. Yes, The banks will likely charge you with low-interest rates when you deposit a large sum this will translates into a lower debt burden too. In UAE, expatriates mortgage borrowers are required to put a 25% down payment for properties under AED 5 million and 35% for properties worth over AED 5 million. If you are willing to sell your old house you can put it as a down payment to the banks. It will make you easy to get a new mortgage after you have got rid of the previous one.
Compare Mortgage Rates with Multiple Lenders
You can apply with multiple mortgage lending banks where you can compare the different rates and fees lenders charge. Your interest rate and the fees involved will differ with each lender. It is a good idea to get at least 3 or 4 mortgage quotes. Use these quotes to negotiate to the best mortgage rates. Take one mortgage quote to another bank and ask what they will offer to make you as their customer. This is one of the most effective ways to make sure you’re getting the best mortgage rates available.