The money that you pay upfront for a house. The minimum down payment requirement is regulated by the UAE Central Bank and it ranges from 20% to 40% of the property value for completed properties. For under-construction properties, it is 50% of the property value.
This is a Government Department that provides various services related to real estate transactions, most notably the documentation of sale transactions, regulation and registration of all transactions.
These are designated areas in Dubai where foreign nationals are permitted to purchase properties. Freehold areas are defined by the Dubai Government by order number 3 of 2006. Similarly, there are designated areas in each of the emirates, however they may defer in the freehold ownership structure.
Similar to Freehold, these are areas where foreign nationals are permitted to purchase properties. However, the property is on a long-term lease, usually, 99 yrs and the leasehold rights are recorded with the Dubai Land Department under a Lease Deed.
This is a common banking terminology and it defines a ratio between the Loan Amount and the Property Value. This is regulated by the UAE Central Bank and ranges from 60% to 80% for completed properties. For under-construction properties LTV is 50%.
This is a formal commitment from the Bank on the loan amount and other terms of the mortgage. This does not include an assessment of the property. Usually, home buyers take a Pre-Approval from Banks post which they search and are able to negotiate on a property as well as commit on a down payment knowing very well that the mortgage approval has been sorted.
Insurance to cover the property being mortgaged is a mandatory requirement by all Banks in UAE. However, certain Banks permit clients to buy their own property insurance and assign it to the Bank. This is different from Mortgage Life Insurance.
This is when a client has a mortgage with a particular bank and wants to transfer his mortgage to another bank on better terms. This is usually done by a client when he is on unfavorable terms, which could be Interest Rate, Tenor or Loan Amount and he wishes to negotiate more suitable terms within another Bank.
When a property owner has an existing mortgage and the avails of an additional loan on the same property. This is possible when the loan outstanding is low or when the value of the property has appreciated. The additional funds can be taken to fulfill the requirement of the property owner.
An interest rate that will fluctuate in accordance with the prevailing market prime rate during the mortgage term. The Prime Rate could be EIBOR or Banks internal lending rate. Banks charge a mark-up rate over and above the Prime Rate. This usually remains constant during the variable rate period.
Yes, certain Banks in the U.A.E offer mortgages to Non Residents of U.A.E, however, they have to offer certain restricted terms such as higher down payment. Usually, a slightly higher rate is charged to Non Residents.
Bank Processing Fee up to 1% of the loan amount. Valuation Fee – Between AED 2,500 to AED 3,000. Property Registration Fee of 2% to 4% (can be split between buyer and seller). The mortgage Registration Fee is 0.25% of the mortgage amount. Dubai Land Documentation Fee AED 375/-
The minimum age requirement is 21 years. The maximum is 65 yrs. to 70 yrs. at the time of maturity of the mortgage. This depends on the borrower being a UAE National or Expatriate and Salaried or Self Employed.
The down payment requirement is regulated by the Central Bank. For completed properties it ranges between 20% to 40% of the property value, depending on UAE Nationals / Expatriates, Self-Occupancy / Investment. For under-construction properties, a 50% down payment is required.