What are the steps associated with obtaining a mortgage in Dubai?
Step 1: Shop for the Best Mortgage Deal
Since Dubai gave foreigners the right to own freehold property, the Dubai mortgage market has developed drastically attracting several international banks to service the industry. With increased competition amongst band, you as a purchaser are advised to become aware of all your options to ensure you get the best deal when buying property in Dubai.
As several financial institutions have sprouted up across the emirate to facilitate the demand for mortgage seekers offering mortgages to non-resident property buyers, as well as offering buyers attractive deals through developers with packages that offer amounts of up to 96% financing of the property value. With a steep growth in the mortgage market and increase in foreign direct investment in the Dubai property market, many banks are offering mortgages to non-residents, but there are limits in the type of mortgages available - for example self-certification mortgages are only obtainable on very short terms and Dubai banks won’t take possible rental income into account when granting a mortgage.
Mortgages are available to buyers of residential property as well as those interested in buying for the buy-to-let market. The lending criteria vary from lender to lender, however in general buyers on average can expect to get 80% mortgage on the value of the property if they are resident in Dubai and 70% if they are non-resident. The mortgage term is usually for 20 years.
Step 2: Submit all necessary documentation according to finance institution chosen
Documents Required for Mortgage Application
These are the basis requirements for a mortgage application in Dubai:
- Application form
- Passport with valid residency (if for a non-resident, the bank has to present in buyers home country and s/he will most likely receive a smaller financing percentage)
- If you are employed you need to provide the following documentation as proof of your income over the last 5 years:
- copies of your last three months pay slips
- copies of your last 5 years Employer’s Reference
- copies of your last 6 months Personal Bank Statements
- For the self-employed the following documentation is required:
- copies of your last 5 years audited accounts
- copies of last 12 month’s business accounts
- last 6 months personal bank statements
