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…
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:
- 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.
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.