As Dubai’s property market experiences a surge in demand, an increasing number of buyers are turning to mortgages to purchase their dream homes. While cash buyers continue to play a significant role in driving the market, mortgages have now become a common and accessible option for Emirati nationals, resident expats, and non-residents alike.
Understanding Mortgage Eligibility and Down Payments
According to the UAE Mortgage Cap Law, expats and non-residents must make a down payment of at least 20% of the property value (15% for UAE nationals) for properties priced below AED 5 million. For properties exceeding AED 5 million, the down payment requirement increases to 30% (25% for UAE nationals), and for second or third properties, it rises to 40%.
To determine your eligible mortgage amount, you can utilize online mortgage calculators available on bank and mortgage broker websites. Once you have an estimate, the next step is to apply for a pre-approval from the bank. This pre-approval is an official confirmation that your loan amount has been approved, offering you peace of mind and certainty during the property search.
The Property Buying Process and Necessary Documentation
When finalizing a property purchase, both the buyer and seller must sign a Memorandum of Understanding (MOU) or Form F (Sales & Purchase Agreement). Following this, the bank conducts a valuation to determine the exact property value and the subsequent mortgage amount. Once approved, a final approval letter will be issued.
In cases where the property is currently mortgaged, the seller must acquire a liability letter from their bank, stating the outstanding mortgage amount. Additionally, a no-objection certificate (NOC) from the property developer is required to confirm the absence of pending service charge payments.
To transfer the property under the buyer’s name, the buyer and seller visit a trustee office to initiate the process. The following documents need to be submitted:
- Liability letter from seller’s bank
- Form F (MOU)
- NOC from the developer
- Copy of the title deed
- Cheque for the seller’s bank as per the liability letter
- Cheque for the remainder of the purchase price payable to the seller
- Cheque for Dubai Land Department fees (4%)
- Original ID documents of both buyer and seller (Passport, visa, and Emirates ID)
With the seller’s mortgage cleared and the necessary clearance documents obtained, the property can be officially transferred to the buyer’s name at the trustee office.
Work with a Reliable Real Estate and Mortgage Partner
To ensure a smooth and hassle-free buying process, it is advisable to collaborate with a trustworthy real estate and mortgage partner. Our Private Client Advisory team is always ready to address your queries, guide you through finding the right property, and assist with the buying process. We work with trusted mortgage brokers like Mortgage Finder to help you secure a loan tailored to your needs and offering the best rates in the market. Contact us today to learn more and make your dream of owning a property in Dubai a reality.