Tips to get mortgage for expats in dubai
There are two ways to buy a property or buy a home in Dubai. You can either pay by cash or choose to get a mortgage. Cash may be a more cost-effective option. However, with a mortgage loan, you can enjoy more flexibility in managing your finances.
There are many types of mortgages available. Mortgage loans are easily available to expats who wish to purchase or invest in property. This blog offers useful tips to get a mortgage in Dubai.
Foreign buyers can avail of a mortgage loan in the United Arab Emirates. However, you have to fulfill certain requirements.
You must be employed in your current job for a minimum of six months or a year. The time period may vary based on the area where you are purchasing a property and the mortgage lender’s terms and conditions.
If you are self-employed, you will be required to have a running business for a minimum of two years. Moreover, it is preferable to already have a relationship with the bank so that it is aware of your circumstances.
A potential hurdle that you might face is that certain banks only accept applicants employed at specific organizations. You are likely to get a mortgage easily if you are working for a banking institution, government department, or multinational company. If your employer is not well-established, you may find it hard to get a loan even if you are creditworthy.
Moreover, it is crucial to have a good credit history at the time of application. Lenders may reject your application if your credit report files are not up to the mark. Therefore, it is best to check your credit file before making an application.
Tips to Remember
Here are some vital tips to remember if you are considering applying for a mortgage in Dubai:
1. Have your down payment ready
Getting a mortgage in Dubai typically requires a minimum of 20% deposit. In many other countries, you can borrow up to 95% of the property from a bank. However, in the UAE, you can borrow only up to 80% as an expat.
Before you begin to explore properties, make sure you decide how you will manage the 20% down payment. Some banks may track the source of your down payment. Therefore, it is best to maintain documents or paperwork for proof of funds.
2. Find a Lender
Home mortgages in Dubai through banks have to be registered with the Dubai Land Department (DLD). You can contact your bank directly to find out the available mortgage deals. Alternatively, you can hire a mortgage broker to look for a mortgage loan.
Brokers usually possess good knowledge about the local market and home loans. Hiring one can help you focus on securing the best property rather than getting caught up in the mortgage process.
3. Get a Pre-Approval Letter
The most crucial step in getting a mortgage in Dubai is receiving a pre-approval letter. This is an official document issued by a bank to validate your eligibility for securing housing finance.
It contains the maximum borrowing limit available and offers more certainty in getting a mortgage. This way, you will know the amount you can spend. It also shows the seller that you have no trouble financing your loan. This makes them more likely to say yes to your offer. A home loan pre-approval letter usually takes three to five working days.
After you and the seller have agreed on a price, you can make your deposit and arrive at a completion date for the transaction. On the last day of property transfer, the bank will make your loan amount available to the seller. This will finally make you the owner of your dream property.