Get FREE CONSULTATION with our team of experts! Click here to start!
Office - 216, Bank Street Building,

Bank Street Road,Burjuman,Dubai,UAE

+971 52 352 5763

Mon-Sat 9am-6pm

[email protected]

24 X 7 online support

Personal Loan Do’s and Don’ts in the UAE

A personal loan is an unsecured loan, which means it does not require collateral or a guarantor. An individual obtains a personal loan in the UAE to meet a variety of personal financial demands, including weddings, higher education, overseas travel, starting a new business, and even debt consolidation. The highest personal finance loan amount is 20 times the monthly earnings, with a 48-month repayment period. The personal loan interest rate and amount in the UAE are determined by factors such as the applicant's source of income, credit history, age, and job status. The key highlight of our study is the Personal Loan Dos and  Don’ts in the UAE.

What is the Personal Loan Interest Rate in the UAE?

The interest rate on a personal loan in the UAE is a fee that is added to the principal loan amount. There are two sorts of interest rates that apply to personal loan offers in the United Arab Emirates:

Flat Interest Rate

The overall loan amount is charged a flat interest rate that remains constant during the loan term. The lowest personal loan interest rate in Dubai, as well as the rest of the UAE, is 2.63 percent, with rates ranging from 2.63 percent to 22.22 percent.

Reducing Interest Rate

Unlike a flat interest rate, this rate of interest decreases with each installment paid by the loan borrower. The interest rate on a personal loan in the UAE is levied only on the outstanding principal amount of the loan, which can range from 5.24 percent to 39.99 percent. To acquire the best personal loan interest rate in the UAE, you should constantly compare personal loans online.

What are the Types of Personal Loans in the UAE?

There are a variety of Personal Loans offered by the banks in the United Arab Emirates for both expats and UAE Nationals which are further listed below:

Expat Personal Loans

Expatriates are non-residents of the UAE who dwell in the nation for work or business purposes and can take advantage of the lowest interest rate personal loan offered in the country.

Personal Loan Without Company Listing

Professionals working in non-listed companies or start-ups can now get a personal loan through a new product line intended specifically for non-listed enterprises that have recently entered the market.

Personal Loan without Salary Transfer

Some lenders do not need applicants to transfer their earnings in order to acquire a loan, making personal loan conditions more flexible.

Personal Loan with Salary Transfer

To receive an immediate personal loan in the UAE, most loan providers require applicants to have a salary account with the bank.

Personal Loans for Residents

Personal loan standards for UAE nationals are more favorable than those granted on personal loans in the UAE for expats.

Personal Loan for Self-employed Professionals

Self-employed professionals are people who run a business and can apply for a personal loan from one of the UAE's financial institutions and get the best personal loan rates.

 

What are the Eligibility Criteria for a Personal Loan in the UAE?

Eligibility Criteria for Personal Loan in UAE are as follows-

Age Limit

In order to qualify for a personal loan in the UAE, you must be at least 21 years old and between the ages of 60 and 65 years old.

Personal Loan Minimum Salary in UAE

To qualify for a personal loan, applicants must also meet minimum wage criteria, which varies from lender to lender in the UAE. You can apply for a personal loan in the UAE with a salary of 3000 dirhams. The required minimum wage ranges from AED 2,500 to 4,000 and up.

Employment Status

You can't get a personal loan if you don't have a job. To obtain a personal loan in the UAE, several banks need applicants to be employed by UAE employers or to have completed at least a few months of service.

Residential Status

Only UAE residents are eligible to apply for a personal loan in Dubai or any other UAE emirate. However, some banks, such as ADIB, provide personal loans to expats. They have varying interest rates on personal loans in the UAE, as well as other restrictions.

Salary Transfer

Banks in the UAE offer personal loans without or with a salary transfer. Some banks also allow applicants to make transfers to a bank of their choice, providing them the option of an easy personal loan in the UAE.

 

Documentation Required to Apply for a Personal Loan in the UAE

To apply for a personal loan in Dubai or the other Emirates, applicants must present the following documents. The following are the prerequisites for obtaining a personal loan in the United Arab Emirates:

  • Completed Application Form
  • To receive personal loan insurance in UAE, the applicant must have a valid passport, visa, and Emirates ID.
  • A valid UAE visa is required to obtain a bank personal loan in the UAE for expats.
  • A three- to a six-month bank statement
  • Letter of Transfer of Salary (Optional)

Personal Loans Dos and Don’ts in the UAE

Avoid rejection of a personal loan application by considering the following dos and don'ts:

Dos

  • Maintain a consistent work history.
  • Make your payments on time every time.
  • Maintain a solid credit score because obtaining a personal loan in the UAE without a credit check is impossible.
  • Look for a reliable source of income.
  • Before asking for a new loan, pay off any previous debts.
  • Maintaining a lower debt-to-income ratio is a good idea.

Don’ts

  • Don't give a resume with a shaky work history.
  • Don't lower your credit score because it will have a negative influence.
  • Don't speed through the application process. A single blunder can result in a loan being denied.
  • Don't miss a single EMI.
  • Do not apply for a new loan until the previous one has been paid off.
  • Don't overlook eligibility requirements such as age, minimum wage transfer, and so on.

Conclusion

Applying for a Personal Loan may often become a complex task. Connect with us, our expert team will walk you through the process and help you choose the right lender for you. If you are looking for any loan-related services, connect with Dhanguard, we will gladly assist you.

Latest Questions

Question & Answers related to Personal Loan


Answer Icon Dhanguard

Personal loans can be a terrific method to cover bills or can be a source of potential financial assistance when you are in utter need to obtain on .. Read More


Answer Icon Dhanguard
  • Whatever your reason for taking out a loan, you'll most certainly have a few options. Credit cards, home .. Read More

Answer Icon Dhanguard

While a personal loan can be a helpful tool for financing larger or unexpected needs, it is not always the best decision. Consider your financial c .. Read More


Answer Icon Dhanguard

A hard inquiry is recorded on your credit report when you seek for credit and a lender analyses your credit report. Hard inquiries stay on credit r .. Read More

Frequently Asked Questions

Personal loans that are taken from banks are automatically insured at a nominal fee and in the event of any premature demise the partner insurance company covers the entire loan amount, protecting the family from any financial risk.

Assets are not required as security against your personal loan.

Normally, the only advance costs pertaining to a personal loan are dispensation and insurance fees.

According to the issuer's policy, some lenders enable the borrower to 'defer' or postpone a month's payment once every few months. To take advantage of these benefits, the borrower must make timely payments. Deferred payments do not reduce the principal amount, and hence will not lower the lowering personal loan interest rate in UAE.

Top-up or add-on personal loans are renewable loans that can be used to supplement an existing loan after the borrower has paid a certain number of payments. Top-up personal loans in the UAE are used to reward loyal, non-delinquent borrowers by providing longer tenors or reduced interest rates, depending on the bank's policy.

No, unless the bank expressly states otherwise or the student has a guarantor, a student cannot apply for this loan. The loan's eligibility restrictions include a minimum monthly salary and a maximum age range of 21 to 65 years. Some lenders may require a salary transfer and confirmation of employment with a lender-approved organization. However, some lenders offer personal loans in the UAE without requiring a company listing. As a guarantor, you can always apply for a student/education loan.

It would be up to you to decide. You should be informed that you must pay the loan's EMI from the beginning of the month, followed by the disbursal. You can take out a loan if you're confident that you'll be able to pay the monthly EMIs at the very least.

If you're having trouble paying your loan EMI, contact your bank to see if there's anything you can do. If you try to avoid the problem, it will only get worse. Banks will issue warnings before dispatching debt collectors. If you do not respond, they may designate you as a defaulter and may even take you to court for the unpaid personal loan in UAE. As a result, it is preferable that you call the bank and explain your circumstances. They may be able to lower your EMIs in some cases.

Almost all personal loans include a life insurance plan for applicants. This insurance coverage protects the borrower from having to make payments in the event of a fatal disease, permanent incapacity, or death. Some personal loans in Dubai also include life insurance plans that pay back the entire loan amount to the policyholder's family members in the event of the policyholder's death.

A personal loan can be used to pay off credit card debt. By consolidating the debt, the loan might assist in the payment of the credit card bill. When compared to credit cards, it has lower interest rates. Even if the applicant has a personal loan minimum wage of AED 2,000, you can return the loan in easy monthly installments over the following few years.

Get Instant Advice
Where To Find Us