Thanks to reasonably priced options and interest rates, overseas and local investors have been targeting Dubai’s versatile real estate market. The mortgage in Dubai for non-resident provision allows buyers residing outside of the United Arab Emirates to acquire an apartment in the city without overextending their budget.
For comprehensive answers on who qualifies for non-resident home loans in Dubai and how such mortgages function, you can read our blog post below.
Can Non-Residents Obtain a Dubai Mortgage?
Yes, foreign investors looking to buy a property in Dubai for investment, a holiday home, or both absolutely can get a mortgage. As a prospective buyer with a mortgage in Dubai for non-residents, you will find several benefits, such as increased flexibility and the option for high loan amounts.
However, it’s worth noting that foreign non-resident investors have fewer options for property financing than UAE nationals and expats. For that, however, you must also be aware of Dubai property mortgage types before taking any action.
Which Overseas Investors are eligible for Mortgage
- Before applying for a non-resident home loan in Dubai, you may need to be a citizen of a country included on the bank’s list.
- To apply for a non-resident mortgage, you must be a salaried or self-employed person.
- Other banks might impose age limits on non-resident mortgage applicants in Dubai. For example, ADCB for a home loan for non-resident applicants must be above the age of 21 years.
- You would also need to meet the bank’s minimum monthly income requirement, which varies from UAE expats to non-residents. Not only, the minimum income level must also be met AFTER tax deductions. For example, if your monthly (post-tax) income is below AED 15,000, you won’t qualify for ADCB mortgages as an expatriate resident.
- Some banks may also include a list of approved property developers and property projects for mortgage financing. Before applying for a non-resident mortgage loan in Dubai, ensure that your property is included in the official approved list.
Types of Mortgages for Non-Resident in Dubai
Were not available for home loans in Dubai for non-residents. You can ascertain the type of mortgage that is ideal for you, knowing various other types of mortgages, their interest rates like fixed vs variable rate, etc.
Fixed-rate mortgage: A fixed-rate mortgage means that the interest rate that you are paying to borrow can be the same for a fixed period of time, ranging between one to five years. It then changes to a variable interest rate, which means it will vary with the market.
Variable rate mortgage: If we choose this mortgage, we have to deal with the fact that the monthly repayments may go up or down over the course of the mortgage.
Discounted rate mortgage: Discounted rate mortgages often have lower interest payments (especially for first-time buyers) for a minimum of two to five years but then revert to a higher interest rate.
Capped mortgage: The capped mortgage is another home mortgage option available for international mortgages in the UAE, among many other schemes. With this arrangement, your payments might vary slightly, but your overall cap will have been determined prior to your loan term starting. If the capped period is enforced for a short period, the interest rates may rise or fall based on the market.
Guidelines on Applying for a Mortgage as a Non-resident in Dubai
If you are a non-resident buyer, you must understand the process behind the Dubai mortgages. Here are the steps that may assist you in your property mortgage undertaking:
- Consult with a Dubai mortgage advisor. They are there to help you dig into all mortgage options and refine the best products based on your circumstances. Considering that there are hundreds of mortgage providers and their respective products in Dubai, this will save you a lot of time and effort.
- Choose a mortgage that works best for you, your finances, etc, with the help of the mortgage broker.
- Submit the appropriate paperwork to be financed pre-approved.
- Then you will get a letter from the bank that says it will lend you money.
- Seek out a skilled real estate agent to identify the ideal property that caters to your needs.
- Your agent will negotiate on your behalf once you’ve identified the right property. Make sure you and the seller have negotiated the purchase price for your new property.
- Secure your move by paying the property deposit.
- You will need to work with the mortgage broker and a conveyancer to process the mortgage and the property transfer.
Required Documents
Documents Required For Non-Resident Mortgage Loans Keep in mind there might be more documents that depend on the property you’re purchasing and the terms of the transaction. Usually, the required documents required for Dubai home loans for non-resident applicants are:
- A valid passport (to serve as proof of identity)
- Bank statements (last 3 to 6 months; as proof of funds)
- Some documents required for obtaining Dubai home loan for non-residents might be:
- Tax returns (if applicable)
- Salary certificates or payslips (in case of a salaried person)
- Commercial license and audited financial statements (if self-employed)
- Details of any existing loans
The Best Deposits Available On Non-Resident Mortgages
If you want to get a mortgage in Dubai, you must make sure you have a proper down payment (deposit) since this is mandatory under UAE law.
The down payment requirements for non-residents are on the higher side as compared to residents of Dubai, who require a minimum of 20% as a down payment under expat mortgages and 15% under UAE Nationals.
If you are a non-resident or foreign house buyer in Dubai, when you are getting a mortgage, generally, banks will need you to pay 40%-50% of the house value in advance.
Features of Dubai Home Loans for Non-Residents
Key features of home loans for non-residents in Dubai are given as follows:
Maximum Loan Amount: Ensuring you know this number will differ from bank to bank, and you will depend on your finances. For example, whereas Mashreq provides up to AED 10 million in funding, ADCB offers funding up to AED 15 million.
Loan to value (LTV) ratios: The property value is subject to the loan to value (LTV) ratios, per the UAE Mortgage Law, the minimum down payment required from non-UAE nationals (especially first-time buyers) is 20% of the property purchase price if the property is worth under AED 5 million. The minimum down payment for properties is over AED 5 million, as is 30% for non-UAE nationals. For applicants who are not residents, however, some banks will only lend 50% of the property’s value.
Interest Rates: Interest rate options are available from some banks in the UAE. For more clarity, learn about the advantages of flat vs. reduced interest rates. That said, you won’t pay a whole lot less than the interest rate offered to expat resident customers in Dubai.
Loan Tenure: Though the maximum loan tenure for resident expatriates is 25 years, subject to the investor’s profile, banks may also approve a tenure shorter than that for non-resident investors. Moreover, the age of the applicant at the time of taking the loan should not be more than 65 years (salaried) or 70 years (self-employed).
Which Banks Provide Home Loans for non-UAE residents?
Home loans for non-UAE residents that banks offer include:
- Dubai Islamic Bank
- HSBC
- Abu Dhabi Islamic Bank
- First Abu Dhabi Bank
- Emirates Islamic Bank
- Ajman Bank
- Standard Chartered
- Abu Dhabi Commercial Bank
Remember that all of these banks have their own eligibility criteria, too. All it takes is a little due diligence and research, then you will be able to get the best mortgage loan in Dubai as per your needs and lifestyle.
Wrapping Up!
A foreign home loan in Dubai may seem like a task, but in reality, it is a vast route for global investors who desire to take advantage of the amazing opportunities available in this competitive real estate market. For those looking to gradually take the steps to own property in Dubai, a mortgage can be of great assistance. By catering to the vast number of properties in Dubai, you can see the great value of Mortgages as a non-resident.
