Home Loan Guide for UAE nationals

Applying for a home loan can be a daunting and complicated process with many potential pitfalls. In the following sections, we will discuss some of the most common mistakes made when applying for a home loan so that you can avoid them.

Common obstacles include not researching, not knowing your credit score, and not understanding the loan terms. By familiarizing yourself with the process and being aware of these potential mistakes, you can increase your chances of success in securing a home loan.

You must follow the process given below for a hassle-free home loan:-

Check your Credit Score

It’s important to check your credit report and rating before applying for a home loan, as lenders will look at this when considering your application. Your credit score is 3-digit, ranging from 300 to 900, reflecting your credit history. The closer you are to 900, the better your chances of being approved for a loan.

Eligibility for loan

To be eligible for a home loan, you must:

• Be a citizen of the UAE or have a residency visa.
• Be employed and have a steady income.
• In the Emirates, the minimum age to obtain mortgage eligibility is 21 years old.
• Not have any outstanding debts or loans.
• Have a good credit history.

If you meet all of the above criteria, you will likely be eligible for a loan. However, it is always best to consult a financial advisor to get tailored advice.

Borrowing limits

The amount you can borrow for a home loan in the UAE is based on your income and the value of the property. For properties worth less than AED 5 million, UAE nationals may borrow up to 85 percent of the value, while ex-pats can borrow up to 80 percent. Moreover, for properties worth more than AED 5 million, the borrowing limit decreases to 65 percent for ex-pats and 70 percent for UAE nationals.

Down payments

If you’re an expatriate or foreign-born non-resident in Dubai, you’ll need to make a 25% down payment on your first property purchase. However, if you are a UAE national, you only have to make a 20% down payment on your first purchase.

Documents required for a loan

As a resident of Dubai, you will need to submit your passport, residency and Emirates ID, latest salary certificate, last 6 months of statements for all accounts and payslips, proof of current address, and latest credit card statements.
If you are a UAE national, you must also provide your current address and proof of residence in the UAE. The final approval of these documents usually takes around two-three weeks.
As a non-resident, you must submit a copy of your passport, visa page and entry stamp, current bank statements (for the last 3 months), and proof of employment and salary.