The local mortgage market in Dubai is growing that gives a great opportunity to investors to buy properties in Dubai. Expats need to understand the important aspects of getting a mortgage in Dubai before they take the plunge. It’s a tough decision, but important one if you want to avoid making costly mistakes. This blog post will present the foreign and local investors with key factors to think about before purchasing a property in Dubai.
Get the Best Mortgage in Dubai with These Tips
1. Be Ready with the Initial Investments
Getting a mortgage can be an expensive endeavor. Some initial fees are necessary to pay for securing a mortgage.
Usually, these fees include transfer fees of 4% and mortgage registration charge of 0.25%. Apart from them, there’s real estate commission of 2%, and 1% loan establishment fees included. Therefore, an investor has to keep 5 to 7% of the total property cost in hand to proceed with the mortgage.
2. Decide Your Mortgage Method in Dubai- Fixed or Variable
There are two ways to secure a mortgage – a fixed rate and a variable rate. Being an investor, you should predominantly decide the mortgage option before transferring the down payment.
In the case of a fixed-rate mortgage, the rate of interest remains the same during the tenure of the mortgage. When it comes to variable-rate mortgages, the rate of interest gets changed periodically according to the Emirates Interbank Offered Rate (EIBOR). An experienced mortgage advisor will help you make the right choice for the mortgage method.
3. Get Your Mortgage in Dubai Pre-Approved
Getting your mortgage amount pre-approved from the bank will help you find the best properties at the defined price. Investors can either get the mortgage directly pre-approved by the bank or through a mortgage advisor. Approval from the bank beforehand showcases that one is eligible for securing mortgages in Dubai
Usually, a down payment of 10% is required as per the sales agreement. Of course, no one wants to get refused by a financial institution at the last minute. So, ensure to apply for pre-approval for mortgages.
4. Keep all the Documents Ready for Speedy Mortgage Proceedings
A lot of paperwork is involved in the mortgage procedure. However, it can vary from bank to bank. The foreign investors should have their copy of their passport, visa, Emirates Identity Proofs. Additionally, a salary certificate from your employer, pay slips, last 6-months bank statements, and recent credit card statements are required for mortgage documentation. A local investor has to show evidence of address, a tenancy agreement, or a DEWA bill.
5. Consider Taking Help from a Mortgage Broker
Seeking professional assistance from a mortgage broker will help you get your mortgage in Dubai without any headache. They understand the market and your needs well. You can look for mortgage brokers online and hire the one under your budget.
No More Hassles & Extra Costs for Mortgages in Dubai
Dubai is a hotspot for property buyers and investors, but it can be tough to navigate the laws. The above points will help you purchase a new property in Dubai without any hassles and additional costs.