Dubai is becoming an increasingly popular destination to own a home for expats, and with that comes an increased demand for mortgages. However, the process of purchasing a property can be lengthy and confusing, especially if you need a mortgage.
There are some nifty ground rules, however, that one must follow to make the process a whole lot easier. Here’s a list of tips that you must keep in mind when securing mortgage as an expat in Dubai.
Having an expert by your side always gives you an edge and saves you the hassle. If you’re a non-resident in Dubai looking to get a mortgage, look no further than Emortgage. Our experienced team can help you secure the best mortgage deal possible and guide you through the entire process.
Here are our top tips on how to secure a mortgage in Dubai:
1. Have the money for a down payment
To get a mortgage in Dubai, you will need to put down a deposit of at least 20% of the property value. This can be a challenge for many expats as they may not have the required funds available.
One way around this is to take out a personal loan from your home country to cover the down payment. This can be a viable option, but you must make sure you can afford the repayments on both the loan and the mortgage.
Another option is to use your savings or raise the funds through family and friends. If you’re able to do this, it’s important to remember that you’ll need to budget for other associated costs, such as stamp duty and legal fees.
2. Check your credit score
Your credit score is one of the most important factors in securing a mortgage. Lenders will use your credit history to assess your financial stability and ability to repay the loan.
If you have a good credit score, you’re more likely to be approved for a mortgage and get a better interest rate. On the other hand, if your credit score is poor, you may struggle to get a mortgage.
There are a few ways to improve your credit score, such as making all your credit card and loan payments on time, maintaining a good credit history, and keeping your debt-to-income ratio low.
3. Get your documents ready
When you apply for a mortgage, the lender will request various documents to assess your financial situation. This may include your passport, bank statements, payslips, and tax returns.
It’s important to have all your documents ready before you apply for a mortgage. This will make it easier for the lender to access your application process much smoother and quicker.
4. Get a mortgage pre-approval
A mortgage pre-approval is a letter from a lender that indicates how much money you’re eligible to borrow for a property. This can be helpful in the early stages of your property search as it gives an indication of your budget.
A mortgage pre-approval is based on your financial situation, including your income, employment history, and credit score. It’s important to remember that a pre-approval is not a guarantee of approval, and the lender can still decline your application.
5. Compare mortgage offers
Once you’ve been approved for a mortgage, it’s important to compare different offers from lenders before making a decision. This will help you find the best deal possible and save money in the long run.
When comparing mortgage offers, be sure to look at the interest rate, fees, and repayments. It’s also important to read the fine print, so you understand the terms and conditions of each offer.
Emortgage can help you compare different mortgage offers and find the best deal for your circumstances. We have a wide range of experience in the Dubai mortgage market and can provide you with expert advice.
6. Consider tenure and fees
The tenure of your mortgage is the length of time you have to repay the loan. The most common tenures are 25 years, but this can vary depending on the lender.
It’s important to consider the tenure when taking a mortgage, as it will affect your monthly repayments. A longer tenure will mean lower repayments, but you will pay more interest in the long run.
You should also consider the fees associated with taking out a mortgage. These can include arrangement fees, valuation fees, and early repayment charges.
At Emortgage, we can help you find a mortgage with low fees and competitive interest rates. We work with various lenders in the Dubai market and can offer impartial advice on which mortgage is right for you.