Many people in the hope of living a luxurious life move to Dubai, a modern and developed city of UAE. Many people come here to enjoy their family vacations, enjoy several recreational activities with memories that last forever. Whereas many job professionals are here in order to advance their careers where there are several opportunities.
People who are in Dubai for short time may prefer staying in hotels but if you are planning to stay here for a long term, then it is better to look for a home for a comfortable stay and enjoy your time in Dubai. One major reason for many would-be how to look for the home and afford a place to live in. Whether you are a local or foreign resident, there are mortgage loans in Dubai available for ex-pats as well as residents to buy a new home or for the investment as well.
Before you look for a property, you must know about the kind of mortgage available and how you can avail them. The guide below will provide sufficient information to non-residents about mortgages, the kind of loan they can avail and the legal issue attached to it.
Types of Mortgages Loans in UAE:
The Dubai Mortgages market is developed and there are several mortgage providers, both local as well as international institutions. Before going to apply for it, everyone must do a little research on what services are provided by various providers, how they work and what are they offering that will benefit you.
Expats have two major things to apply for mortgages, either for a home that you are planning to live in or the property that you want to invest in. the amount of deposit that you have to pay will change with the kind of property you want to buy and the circumstances around.
If you want to invest in property, the bank might consider it riskier and the initial deposit will be higher than usual. If an ex-pat is looking for investment property mortgages, they might be asked to pay up to 40% price as a deposit, which might be raised to 50% if you are buying off-plan. In the case of a home to live in, the deposit amount will only be around 25%.
One thing that everyone must know is that the mortgage amount that is offered legally have certain restrictions. The full amount that an ex-pat buyer has to repay, including the principal and interest, has to be equal the amount that you can earn within the coming 7 years and it should not excesses more than it.
Mortgage loan rates:
Before anything else, the applicant must understand mortgage loan rates Dubai whether you want to go for the fixed-rate or the variable rate product. With the fixed-rate, you will ae to pay the same amount of interest throughout the duration decided for repaying the loan. The time duration is usually five years after that the bank decides how much interest rate they want to put on mortgages. The rates after the decided period are usually not preferred and could be out of your budget thus it is better to understand the available options, before finalizing any deal.
The other option that you might have is variable-rate mortgages. In this type of mortgages, the interest rate is not fixed and could be higher or lower depending upon the changes in the interest rates. It can be only beneficial if you know that the interest rate will lower during the time when you have to repay it.
Different products are offered by banks and brokers but not all kinds of loans can be availed by everyone. To understand the difference and see what suits you the best, the ex-pats must seek a bit of advice from experts before availing any products.
Bank Vs Broker:
When looking for a loan, you have two options that can help you arrange for it, the bank or the broker.
You must do a little research and compare various service providers when looking for mortgages to see who offers the best services especially for ex-pats and could prove to have great potential options. Once you have analyzed, you can directly contact the institution you want to apply for a loan.
It is always better to take advice from a mortgages broker to help you better understand the liabilities of ex-pats and how to get the best deals according to your needs. The expert advice is always beneficial especially when you are new to the mortgages market or are not familiar with the options and the regulations that are expected to follow.
A few years back there was a change in local laws after which it was possible for non-residents to buy property in Dubai. The change in law led to a large number of expats buying a property in Dubai, to live in by themselves or at a time to rent it out.
As afar as the mortgages are concerned, every bank has its own terms and conditions and some might not work with foreigner buyers as they think it is a risk to give mortgages to expats. However, the banks that are ready to work with expats ask the investors to pay substantial down payments before they move to the purchase procedure.
How foreigners can get Mortgages in Dubai?
When an expat applies for the mortgages, there are certain requirements form the bank side that they have to follow.
Usually, it starts with paperwork where you could be asked for personal documents like passport, proof of legal residence, and other documents to prove your financial status.
There are also fee requirements like mortgage registration that is 0.25% of the mortgage value. It also includes the processing fee, property valuation fee and other registration fees as well.
The local laws have made it easier for the non-residents to buy a place to live in, with high living standards but one must be aware of all their rights and the options they can avail before availing any option.