Check our Frequently Asked Questions for more clarity on the mortgage details and process
- ♦ A higher down payment on your property now, means lower total payments on your property in the future.
♦ Loan to value (LTV) is a financial term used by lenders to express the ratio of a loan against the value of the home.
♦ While it’s tempting to apply for the highest LTV, it is advisable to pay a higher down payment and opt for a lower LTV, this helps in ensuring that future payments are manageable and also helps you save up money for other unforeseen and unavoidable circumstances.
♦ It can also help make a self-funded loan through rental income without having any burden on your disposable income.
♦ It also gives you immense flexibility to move for a better offer or pricing in case another bank is offering lower rates than your current home loan.
- ♦ When looking at possible Home mortgage rates, it is quite important to evaluate both the fixed and the variable rates before choosing the right fit for you.
- ♦ However, while it is quite tempting to go with the lowest possible interest/profit rate, please note that most advertised fixed rates are for a short intro period.
- ♦ In order to understand and make a balanced decision, our team will help in your financial evaluation and property selection, by evaluating the variable rates which include both the base rate and the bank margin after the fixed intro rate period, thereby providing the best of the offers available in the market at the time.
- ♦ What you buy is important. Where you buy is even more so. That’s why the first rule of real estate is: location, location, and location.
- ♦ Carefully consider things like the developer, the neighborhood, and the distance to amenities like shops, schools, and parks. These factors will not only help you live more comfortably, but will have a big effect on your property’s sale and rental values in the future.
- ♦ Shorter tenor will result in less overall interest paid.
- ♦ When buying your home, don’t stretch your financial commitment by unnecessarily extending your mortgage tenor.
- ♦ Although you will reduce your installments which makes you eligible for a higher loan, you will end up paying more interest overall, making your home more expensive to own in the long term.
- ♦ MOU must be a comprehensive document outlining clear obligations of the buyer and seller.
- ♦ The document must be explicit and clear with regards to the fee payable to the real estate broker, government institutions, developer and lender respectively.
- ♦ It is suggested that MOU outlines a reasonable time frame to complete the transaction, especially when the seller has a mortgage and buyer is also completing the transaction through financing.
- ♦ MOU must protect the buyer in the event of valuation amount falling short of the agreed sale price or mortgage approvals not coming through due to any reason.
- ♦ MOU must ensure buyer is protected against any former legal disputes or claims made by the competent authorities or the developer which could halt the transaction.
- ♦ Particularly for rented properties, MOU should highlight clear and transparent actions with regards to the possession and the future tenancy terms.
- ♦ An independent valuation of the property is mandatory by the banks’ empanelled valuators.
- ♦ The finance amount is calculated by the lender based on the valuation amount provided by the valuator.
- ♦ In some cases, the valuation price can be lower than the sale price which essentially means lesser financing and higher down payment.
- ♦ In order to avoid such a situation; one must include an exit clause in the MOU to mitigate such risk which could also protect the buyer from losing their initial deposit in case the buyer falls short of the expected financing amount.
- ♦ Market value ascertained by the valuators excludes transfer, brokerage fee, removable of goods and furniture.
- ♦ Since a change in the local law in 2002, foreigners, resident or not, can legally buy property in Dubai, and apply for a mortgage.
- ♦ This fuelled a big rise in expats buying homes in Dubai, either for themselves or with a view to renting the place out at a profit.
- ♦ When it comes to mortgages, individual banks will set their own terms, and not all banks will work with foreign buyers due to a perception that expat buyers involve increased risk to the bank.
- ♦ Because of this, the banks which do work with foreign buyers insist that investors must pay significant and slightly higher down-payments before the purchase can proceed.
- ♦ The options open to you for getting a mortgage in Dubai usually vary depending on your personal circumstances, and the location as well as the value of the property you want to invest in.
- ♦ Offers usually vary, so it’s worth talking to a few brokers or banks to see what deals they can offer you.
- ♦ mortgagemarket.ae has access to a comprehensive panel of all lenders in the UAE.
- ♦ Over 15 years of experience in the UAE mortgage market has allowed us to forge strong relationships with everyone from the big banks to the niche providers.
♦ You can be sure that your loan will be selected from the best deals in the whole market.
- ♦ There will be a combination of our online mortgage application, your appointed mortgage relationship manager, and our case progression team who will be tracking your case with the bank and ensuring that the application is processed with all the right documents and minimal disruptions.
♦ This is all backed by the team’s experience and in-depth market knowledge to make your mortgage application process as quick, easy, and stress-free as possible.
- In order to get a mortgage in UAE, you’ll generally need to follow these steps:
- ♦ Decide if you want to use a mortgage broker to explore your options for a mortgage or deal with the banks directly – Mortgage Brokers usually deal with a variety of banks and can provide more options with respect to the mortgage repayment and in some cases, obtain a better rate for the client as part of a promotional offer.
♦ Choose a mortgage option provided by the bank or the mortgage broker that suits your needs
♦ Hand over the paperwork requested to get a finance pre-approval, which is sometimes called a mortgage offer in principle. Your bank will give you a letter confirming what they will lend you
♦ Find a property within your budget and agree on a purchase price with the seller
♦ Pay your deposit to secure the sale and agree on a completion date
♦ Provide any additional documentation needed to confirm your mortgage, including searches on the specific property you have chosen - ♦ Ensure that there are enough funds in the account to cover the additional costs such as the bank and land department fees and charges.
- ♦ Once the Sale is processed, obtain the title deed and other relevant documents to the property and proceed to enjoy your new property.
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