Foreign buyers can get a mortgage in the United Arab Emirates, but need to meet certain criteria. You will need to have been in your current job for at least six months or a year, depending on the area you are buying and your lender’s rules.
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Self-employed borrowers will need to have been running their business for at least two years. It can also be beneficial to have an existing relationship with the bank, as it will be familiar with your circumstances.
One of the biggest quirks of the system is that some banks will only accept applicants who work for specific companies. This means that if you work for a government department, banking institution, or multi-national company, you are unlikely to have a problem.
If your employer is smaller or less-established, however, you may struggle to get a loan from some lenders even if you’re creditworthy.
Furthermore, it is important to have a clean credit history when applying, as lenders tend to reject applicants with poor or non-existent credit files. With this in mind, you shouldn’t apply for a mortgage until you have checked your credit file and repaired any issues.
If you have never had credit, you could consider taking out a credit card and paying it off in full each month to build up a credit history.
Expats taking out a residential loan will need a deposit of at least 25% if they are buying a property worth up to AED 5 million. More expensive homes will require a deposit of at least 35%. If you are looking to invest in a property and rent it out, you will need a buy-to-let mortgage, which will require a much higher down payment of around 40-50%.
Borrowing is capped in a variety of ways. The amount you will be borrowing (including the interest) cannot be more than your total anticipated earnings for the next seven years. In Dubai, mortgage payments are capped at 50% of your monthly income; a figure that is generous compared to the caps of 30% or 35% used in some European countries. When applying for a mortgage, you might find that banks require you to have higher earnings than a local applicant, as some lenders consider ex-pats to be a riskier proposition.
When applying for a mortgage, the documents you will need may vary depending on which bank you are using.