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Check Home Loan Eligibility Criteria & Documents Required in Dubai

When looking to buy an apartment or a villa in the Dubai, many people search for 'home loans in Dubai.' When expats relocate to Dubai, they want to purchase a home that meets their needs while remaining within their budget. UAE nationals are also on the lookout for their ideal home. Many people are looking forward to applying for a house loan in the United Arab Emirates, thus Dhanguard has created a list of key things to know before doing so.

For many expats, Dubai represents the final doorway to higher living standards and a more pleasant environment. If you've recently moved to the Dubai and are wondering whether or not you can get a home loan, the answer is yes.

We will answer all of your questions about this topic in this article; read on to learn how to own a home in the Dubai.

What is the Procedure for Getting a Home Loan in Dubai?

The application process for a home loan in Dubai is simple; simply follow the steps below:

  • Choose whether to deal directly with a bank or through a broker.
  • Choose the best mortgage plan for you.
  • Obtain a letter of acceptance or a mortgage agreement in principle.
  • Look for the unit you desire and negotiate the best price.
  • Pay the deposit to confirm the purchase and the completion date after you've agreed on a pricing.
  • The amount will be paid by the bank or loan lender by the due date.

What Are the Types of Home Loans or Mortgage in the UAE?

In the UAE, there are several types of house loans that vary based on the rate of interest; this is the most significant thing to consider when deciding whether the deal is acceptable or not.

The following are the types of mortgages available in the UAE:

Fixed Rate Mortgage

It's the simplest one, in which you agree on a set interest rate percentage before the loan period begins. It's a fantastic alternative because it won't be influenced by future events, allowing you to determine the exact amount you'll pay in each instalment for the entire period with no variation.

Variable Rate Mortgage

This type has a variable interest rate, as the name implies. It varies depending on the market or any new rules enacted. It's a two-edged sword since the drop or increase is unforeseeable. Just make sure you're financially secure before going with this option to ensure you'll be able to afford any increases.

Discounted Rate Mortgage

The term "discounted rate mortgage" refers to a loan during the first months of the loan term, the borrower offers you a discount in the amount of a specified percentage. You must determine whether this type is appropriate based on the amount you will pay once the discount period expires, or it will be a risky alternative.

Capped Rate Mortgage

This one is similar to the Variable Rate Mortgage in that the interest rate is not fixed; but, before the loan period begins, you agree on a maximum rate of interest. Whatever market fluctuations occur, the interest rate will not exceed the agreed-upon maximum limit.

Re-mortgage

This type is ideal if you have already applied for a loan and require an additional one while your current loan is being processed.

Offset Mortgage

You may now link your loan, savings, and credit accounts with this new feature. As a result, anytime you receive additional funds on any of your accounts, the total interest amount is reduced.

What is the Eligibility Criteria for Obtaining a Home Loan in Dubai?

To apply for a loan, you must meet certain requirements. The following are the prerequisites for obtaining a home loan in Dubai:

  1. You should have been at your current work for at least six months or a year.
  2. Your company should have been in operation for at least two years if you are a business owner.
  3. To make getting a loan easier, you should have a good credit history, which demonstrates that you're a reliable person.
  4. If you don't already have a credit card, you should consider getting one and utilising it. Simply make sure to pay it off each month by the due date to establish a good credit history.

What Documents are Required for a Home Loan?

To apply for a home loan as an expat in Dubai, you'll need the following documents:

  • A statement of your pay
  • A duplicate of your passport
  • A document proving your residency in the United Arab Emirates.
  • A bank statement from the previous three or six months
  • A copy of your most recent utility bill
  • A trade licence is required for business owners.

What Banks in the Dubai Offers the Best Mortgage Rates?

These are the most well-known banks in Dubai that offer the greatest home loan deals.

  • HSBC
  • Mashreq Bank
  • The Commercial Bank of Dubai (CBD)
  • The United Arab Bank (UAB)
  • Emirates Islamic

Let’s know Different Home Loans/Mortgage Rates in Dubai

People who want to buy a home in the UAE with a mortgage or a loan have a variety of options. Individuals can choose from a wide range of mortgage solutions provided by UAE-based financial institutions and real estate organisations.

Prospective buyers should investigate different features of interest rates for various financing options around the world. Finding a home mortgage that is tailored to your individual circumstances is crucial.

To secure a loan, you'd even need a bank account. After evaluating them, you may choose the best bank for a home loan in the UAE:

Emirates NBD

As one of the most well-known financial organisations in the UAE, Emirates NBD offers mortgages up to AED 15 million. The loan can cover up to 75% of the property's value. Aside from that, people who are looking for a loan can use a pre-approval service.

HSBC

Individual loans are also available from HSBC, a large financial institution in the UAE. Borrowers with a monthly income of AED 15,000 or more are eligible for mortgages from the bank. These loans can only be used for specific projects.

Mashreq Bank

Mashreq Bank is a UAE-based financial company that provides loans and mortgages to individuals. It provides loans to UAE residents as well as expatriates. Only expats and UAE residents who are employed or self-employed and earn at least AED 15,000 per month are eligible for these mortgages and loans. The highest loan amount that can be received is AED 10 million.

Conclusion

The Dubai mortgage sector has established itself, with local and foreign lenders providing home loans to expats. Expats in the Dubai can apply for a buy-to-let mortgage as well as a residential mortgage. The lending criteria, on the other hand, may range from one lender to the next and from one borrower to the next. With Dhanguard you will get How to acquire your Home Loan without any errors, at the lowest cost, and with the transaction done smoothly at your fingertips in your preferred location.

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