What is a Non Resident Mortgage?

The UAE is a country like no other, and it’s no surprise that over 240,000 Britons have settled here in cities such as Dubai and Abu Dhabi. With excellent value for money, expats are buying stunning properties for a fraction of what they would pay for a house back in the UK. However, you do not need to be a resident to take advantage of the fantastic Dubai property market.

Non resident mortgages are making the market more accessible worldwide. In this blog, we will discuss what a non resident mortgage is, who could benefit from a non resident mortgage, and how you can obtain one the easy way.

What is a Non Resident Mortgage?

A non resident mortgage is a loan that allows you to purchase property in another country, even if you do not live there or have a citizenship. The forward-thinking leaders of the UAE wanted to create a stronger economy that doesn’t rely on crude oil, so they opened up their property market to the world in 2003.

There are several freehold areas across Dubai and the wider UAE. People from countries such as Britain, the United States, Saudi Arabia, India and more have purchased well-priced, luxury properties in the country.

As more buyers look towards cities such as Dubai for property, it is creating stability in the market and increasing the demand for high tier developments and projects.

Who Can Benefit From a Non Resident Mortgage?

Non resident mortgages are highly appealing as they open up Dubai to the rest of the world. Some of the people who can benefit from a non resident mortgage include:

International Property Investors

Investors from overseas know there is plenty of value in Dubai’s property market. With the World Expo being held in the city, and the huge growth in the city’s popularity among the younger demographics as a holiday destination, property has become a prime asset in Dubai.

Over 25 million visitors from 192 countries are expected for the Expo, which means rental property will be in high demand. Properties in previous host cities have also seen significant capital growth. Prices have increased by 46% in Shanghai since the event was held in 2010.

Current Expats Leaving the UAE

Circumstances change for everyone, and if you’re an expat looking to head back to your home country, you may be wondering if you can hold onto your property. The good news is you certainly can.

This route is perfect if you want to return to Dubai when you’re able to or if you want to keep hold of the property as an investment.

You will have to get in touch with your lender to convert your current mortgage into a non resident one, as you are not technically allowed to leave the UAE with debt. It’s very rare that this poses an issue, and we can always help you find a new lender if any problem arises.

We have written a more comprehensive article if this option interests you, covering how to ensure a smooth mortgage transition if you leave the UAE.

Holidaymakers

Dubai is a fantastic place to live, but it’s also a great holiday destination. A non resident mortgage lets you own your own little bit of paradise in Dubai without you having to give up your life back home.

There are several freehold areas in popular destinations such as:

• Palm Jumeirah
• Downtown Dubai
• Dubailand
• Jumeirah Village Circle
• Dubai Marina & Jumeirah Beach Residence

Many of these areas are famed for their tourist attractions and stunning views. It’s no wonder then that millions of holidaymakers come to Dubai every year.

Are There Any Restrictions to Obtaining a Non Resident Mortgage?

As you can imagine, the rules for buying property in the city are different for those who do not live in Dubai. However, the regulations are much easier to navigate with expert guidance.

The UAE Mortgage Cap Law requires non nationals to put down a cash payment of at least 50% of the property’s value before they can take out a loan. For example, a buyer based in the UK looking to purchase an AED 1 million property would have to raise AED 500,000 first. This is equal to £98,000.

Workers employed in certain industries may also be restricted, but our advisors can help determine whether you qualify. Certain banks will reject a mortgage application if the country you’re based in is not on their list of approved countries.

How Do You Obtain a Non Resident Mortgage?

To be eligible for a non resident mortgage, you will need to meet certain criteria and have the right documents in place. The most important aspect for lenders is that they don’t lose money, so stable employment and proof you can keep up with the repayments is a must.

Self-employed workers, freelancers and contractors are also eligible, but they will have to show further proof that their businesses are going strong first.

The required documents include:

• Proof of identity (ie. a passport)
• 6 months worth of bank statements (self-employed applicants may need a years worth)
• 6 months worth of wage slips
• 2 years worth of business audits (self-employed)

Getting a Dubai Mortgage for Non-Residents

Expat Mortgage was set up to make purchasing property in Dubai as easy as possible. We understand that applying for a mortgage in a completely different country can be confusing, but we offer a hands-off service that means you don’t have to worry about managing the process.

We will approach the banks on your behalf and negotiate for the best rates. Thanks to our strong working relationships with the lenders in Dubai, we can obtain exclusive non residential mortgage rates that aren’t available to the general public.

On average, our clients save AED 150,000 over the lifetime of their mortgage. That’s the equivalent of £30,000.

To find out how much money we can save on your non residential mortgage or if you have any further questions about the process, make sure to get in touch with a member of our team.