Home Loans for Expats

A home loan or mortgage loan is a type of loan provided by a financial institution or a recognised lender to help you finance your purchase or renovation of your home. Also referred to as home finance, home loans in UAE have become popular choices for house financing as they allow customers to make affordable repayments and live without compromising other expenditures.

Whether you are an ex-pat or a local, a home loan can be advantageous while purchasing any property or residential place in the UAE. And while you will be aware of the concepts like interest rate, monthly installments, and so on, several other factors come into play when availing of a loan from any financial institution. This is especially the case for ex-pats, who can discover various mortgage loans in the UAE along with numerous distinct conditions. 

Types of Home Loans for Expats

As mentioned earlier, there are multiple types of mortgage loans or home loans in UAE that are highlighted in detail below.

• Fixed-rate Mortgage: As the name suggests, this sort of loan features a fixed interest rate which is determined initially as per the loan amount taken and the loan provider. This interest rate remains static even amidst market fluctuations. 
• Variable-rate Mortgage: This is a more traditional loan type in the UAE. The loan rate is dynamic and frequently changes based on the Emirates InterBank Offered Rate (EIBOR). This can provide you the option to endow a lower amount as per the EIBOR guidelines. 
• Discounted Rate Mortgage: For your mortgage loan in the UAE, you might get reduced interest rates. In most situations, these low home loan terms are only available to first-time buyers and have marginally lower rates than the benchmark EIBOR. It should be noted that this reduction is always applied to the lender's base interest rate on a mortgage loan. 
• Capped Rate Mortgage: It is a type of variable rate loan wherein the interest rate has a maximum limit that cannot be crossed. This implies that even though your home loan's interest rates may change over a period, they will not rise above a certain point.
• Offset Mortgage: Offset mortgage enables you to link a deposit account or a credit card to the loan. With this option, you can avail of lower interest rates on a home loan in the UAE if you have a savings account or any other financial instrument with the provider. These loans can also provide you with the option of an easy payment method, where the funds in your connected account can directly be sent to the creditor. However, this direct transfer can also be subject to an annual fee in the UAE, which should be verified first with the loan provider.

Features of Home Loan for Expats

Listed below are the key features of home loans offered to ex-pats and non-residents in UAE:

• Maximum Loan Amount: While the amount varies by bank and the financial conditions of the applicant, ex-pats can usually get a home loan of up to AED 10 million (and even more) in the UAE. 
• LTV Ratios: Expats are usually required to make a down payment of 20-25% of the home purchase price if the home is worth about AED 5 million. Non-UAE nationals are generally required to put down at least 30% in the form of a down payment if their planned home is worth more than AED 5 million. It should be noted that non-resident candidates can only have about 50% of the house's value financed by some of the UAE banks.
• Interest Rates: The interest rate can get a little higher for the ex-pats in UAE. 
• Loan Tenure: While resident expatriates have a maximal loan term of 25 years, banks may authorise a shorter time frame for non-resident investors based on their backgrounds. Moreover, banks may impose a constraint that the applicant's age during the loan term should not surpass 65 years (paid salary) or 70 years (business).

Eligibility Criteria for Expats Applying for Mortgage Loan in the UAE

For an ex-pat, banks have laid down exclusive criteria for availing of a home loan in UAE. The criteria, while depending on the bank, generally include:

• Tenure of employment in the UAE
• Credit History
• Business period in the UAE (usually a minimum of 3 years)
• Duration for which you have lived in UAE (generally required to be between 6 and 12 months)
• Specified debt-to-income ratio (to verify the applicant’s ability to complete the repayment)

Besides the above-mentioned list, ex-pats may also need to pay approximately 20-25% of the total purchase value as a down payment to avail of the mortgage loan in UAE. Similarly, some other fees that may be levied on ex-pat applicants include 25% of the mortgage registration fee, 4% transfer fee, valuation fee, 2% commission for the property, and so on.

Affordability is a critical determining element for loan qualification all around the world. In various nations around the world, you must demonstrate that your total debt instalments do not exceed 35% of your entire income.

Essential Documents to Apply for a Home Loan for Expats

Residents in the UAE have the choice of obtaining loans for their properties through a variety of methods. While one can always enquire with a commercial bank to verify their specified terms and required documents for granting a mortgage or loan, given below are some commonly requested documents while applying for the loan.

• Copy of individual ID documents like Passport
• Evidence of legal residence in the country and address proof
• Bank statements
• Evidence of income (salary slips)

Top Banks That are Offering the Best Home Loan in UAE for Expats

Following are some home loans offered by the leading banks in UAE:

ADIB - Home Finance for Expats

Features of ADIB Home Finance for Expats

• Free property insurance
• Profit-free personal loans
• No processing fee for salary transfer customers
• Optional grace time of six months
• Reduction Rate: 3.75%
• Charge free Takaful cover
• The variable interest rate depends on the Central Bank’s 3-Month EIBOR and the bank’s Margin.

Dubai Islamic Bank - Al Islami Home Finance for Expats

Features of DIB Al Islami Home Finance for Expats

• Shariah-compliant loan
• Repayment Tenure - 25 years
• 1% processing fee on the finance amount for Ijarah transactions. There is no fee on balance transfer.
• The variable interest rate depends on the Central Bank’s 6-Month EIBOR and the bank’s Margin.
• Reducing Rate - 3.24%
• There is fixed rate loan but for freehold segment under Murabaha

Emirates NBD Mortagage - Expatriates

Features of Emirates NBD Mortagege -  Expatriates

• Loan Amount: up to AED 15,000,0000
• Financing is up to 75% of the property value
• Loan tenure - 25 years
• Available for salaried and self-employed people

FAB - Islamic Home Finance

Features of FAB Islamic Home Finance

• This is a shariah-compliant home loan.
• No processing fee on buyouts
• Finace up to AED 20,000,000
• Flexible payment period - up to 25 years
• Finance of up to 80% of the home’s value

Emirates Islamic  - Home Finance

Features of Emirates Islamic Home Finance

• Finance of up to 80% of the home’s value
• Easy monthly repayment with longer repayment duration of up to 25 years
• 1% processing fee but 0% processing fee on buyouts
• Low rate on Life Takaful
• Competitive profit rates linked with EIBOR

How to Apply for a Home Loan forExpats in UAE?

In the UAE, you can register for a home loan both offline and online. Here are the steps to be followed to get a home loan in the UAE as an ex-pat.

Apply Online for Home Loan for Expats

• You can visit the ‘home loan’ section on our website or that of your preferred loan provider. 
• Fill out the required form for the plan of your choice. The benefit of doing it from our website is that you will get to explore the best home loans from various providers in the UAE. 
• After completing the form, you will be required to upload the specified documents. Once this is done, you can submit the form. 
• If your application is found eligible for the home loan of your choice, the bank will contact you and guide you regarding the subsequent procedure 

Apply Offline for Home Loan for Expats

• Visit the commercial bank branch or the lender from which you want to obtain a home loan . 
• Request an application form there and fill it out properly. 
• Attach the required documents with the form and submit it. It is recommended to enquire about the list of necessary documents and carry all of them to avoid any last-minute hassles.
• After you deposit the form, the bank will verify your details and the submitted documents. 
• If you are found eligible as an applicant, you will be contacted by the bank for further steps. 

Key Takeaways

As an expatriate, you can easily obtain a home or mortgage loan from the several types of home mortgages available in the UAE like fixed-rate mortgage loans, variable-rate mortgages, offset loans, capped rate mortgages, etc. A high principal amount, transfer facility, and others are among the top advantages of a property loan in the UAE. 

If you discover a home loan of your liking, you can easily apply for it on our website, the provider’s website, or at the nearest bank branch. Just make sure that you enter all the required information correctly and have your documents ready while applying for the mortgage loan, as any incorrect details may result in a rejection.

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