Mortgage in Dubai: The Complete Guide for Foreign Investors
Dubai’s real estate market attracts investors with high yields and favorable tax conditions. Mortgage terms differ, so here’s what you need to know to secure financing.
1. Why Take Out a Mortgage in Dubai?
Getting a mortgage in Dubai offers several advantages:
- Competitive Interest Rates – Although higher than in Europe, interest rates remain attractive (between 3% and 6% depending on the borrower’s profile and the bank).
- No Tax on Rental Income – Ideal for investors looking to generate passive income.
- Growing Market – Dubai continues to attract expatriates and businesses, ensuring strong rental demand and property value appreciation.
- Access to Luxury Properties – Thanks to flexible payment terms and financing options offered by local banks.
2. Who Can Get a Mortgage in Dubai?
Banks in Dubai provide mortgage loans to:
- UAE Residents with an employment contract or a business established in Dubai.
- Non-Resident Expatriates looking to invest in Dubai (subject to stricter conditions).
- Companies and Foreign Investors seeking to diversify their real estate portfolio.
3. General Terms for Getting a Mortgage in Dubai
Amount of Financing
Banks generally finance between 50% and 80% of the value of the property, depending on the borrower’s profile:
- Residents in Dubai – Up to 80% of the property value.
- Non-Residents – Usually 50% to 60% of the property value.
Credit Duration
- Between 5 and 25 years, depending on the borrower’s age (the loan must be repaid before the age of 65–70).
Interest Rates
- Fixed or variable, usually between 3% and 6%.
Minimum Income Requirement
- Residents – From 15,000 AED/month (approx. €3,800).
- Non-Residents – Often higher, between 25,000 AED and 40,000 AED per month (€6,300 – €10,000).
Down Payment
- 20% for residents.
- 40% to 50% for non-residents.
4. Documents Required for a Mortgage Application
For Residents
- Valid passport + UAE residence visa
- Emirates ID
- Pay slip and employment contract
- Bank statements for the last 6 months
- Proof of address
- Details of the property being purchased
For Non-Residents
- Valid passport
- Proof of income (salary slips, company balance sheets, etc.)
- Bank statements for the last 6 to 12 months
- Proof of property investment
- Credit history in the country of residence
5. Best Banks for a Mortgage in Dubai
- Emirates NBD – Offers loans up to 80% for residents.
- Mashreq Bank – Known for its flexibility on interest rates.
- Dubai Islamic Bank – Provides Sharia-compliant financing.
- HSBC Middle East– A good choice for expatriates with existing HSBC accounts.
- Abu Dhabi Commercial Bank (ADCB) – A good choice for expatriates with existing HSBC accounts.
6. Steps to Get a Mortgage in Dubai
- Define Your Real Estate Project – Type of property, budget, and investment objective.
- Compare Banking Offers – Consult multiple banks to negotiate the best terms.
- Prepare the Documents – Ensure all bank-specific requirements are met.
- Apply for Pre-Approval – This gives you a clear idea of the loan amount available before signing a purchase agreement.
- Complete the Purchase – Once the loan is approved, sign the documents and proceed with the payment.
- Register and Transfer Ownership – The property registration is completed with the Dubai Land Department.
7. Alternatives to Bank Mortgages in Dubai
- If you don’t meet the banks’ criteria, here are some alternatives:
- Developer Payment Plans – Some developers offer financing options directly, without involving a bank.
- Private Investors – You may find private lenders willing to provide funding through partnerships.
- Real Estate Crowdfunding – Platforms that allow you to invest in real estate with smaller capital.
8. Pitfalls to Avoid and Expert Advice
- Hidden Fees – Watch out for processing fees, mortgage insurance, and early repayment penalties.
- Use a Mortgage Broker – A broker can help you secure the best rates and terms.
- Prepare a Higher Down Payment – A larger down payment reduces the risk of loan rejection.
- Don’t Underestimate Total Costs – Factor in taxes, notary fees, and maintenance charges.
- Plan for Interest Rate Fluctuations - For variable-rate loans, anticipate possible rate increases.
Conclusion: Accessible yet structured financing.
Getting a mortgage in Dubai as a French citizen is entirely possible, but requires good preparation. With a solid application and a good understanding of the market, it is possible to invest in Dubai real estate under favorable conditions.
For further research, check out our other guides on opening a bank account in Dubai, the best banks for expatriates, and the steps to buying property in Dubai.
