Expat Mortgages: A House Loan Guide for Expats to the UAE

Author

Aquilina Zarour

Date of publish

Aug 04, 2022

Expat Mortgages: A House Loan Guide for Expats to the UAE

Mortgages

A mortgage is a residential loan that a person who wants to purchase a real estate property but does not have the money. This type of loan is very beneficial in the United Arab Emirates, and it is indeed one of the most common ways that many refer to. To get a mortgage in the UAE, the lender will have the right to sell the real estate property in case he/she did not receive the money, all based on the contract.

Obviously, since mortgage falls under the category of loans, interests do apply.

The other option when purchasing a real estate property in the UAE is paying cash. This is usually the go-to option for the ones who have savings and who prefer paying the full amount at once and avoid additional expenses and fees such as interest.

It is important to mention that both have their pros and cons, and it all comes down to the preference of the buyer and his/her financial situation. The cash vs mortgage issue has always been a common topic that many investors discuss.

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Expat Mortgages in the UAE: Is It an Option?

As many might know by now, expats are allowed to purchase a real estate property in the United Arab Emirates. This is usually possible in specific areas that are designated as freehold, which makes it possible for expats and foreign investors to start building their dreams in the United Arab Emirates – one of the top countries to live in the whole world.

That being said, expat mortgages in the UAE are a valid option that expats can consider in case they do not have the money or if they simply do not want to pay the full amount at once. This has been very useful on so many levels, especially since the UAE aims at encouraging all types of investments within the country.

Expat mortgages and purchasing a real estate property in the UAE has many benefits, one of which is UAE residency, under certain conditions, of course.

Furthermore, and as already mentioned, expat mortgages are indeed an option, but there are some conditions. For example, for the cash down payment for expat mortgages, it is no less than 20% of the property value, and it can reach up to 50%, based on the value of the property. As for UAE nationals, it starts from 15%.

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Why Expat Mortgages to Buy a Property Better Than Renting?

Recently, the United Arab Emirates has been the top option for expats. This means that many are relocating and are either starting a career, a business, a family, or even pursuing their studies in the United Arab Emirates. And obviously, when one wants to go live in a totally new country, the first housing option is rent. This might be reasonable for the ones who are going to live in the country for a limited amount of time.

However, when it comes to living in the United Arab Emirates for over 3 years, the wisest option would be to buy, not rent. The reason is quite simple; rent in the United Arab Emirates is considered to be expensive, and in the long run, purchasing a real estate property would be much more beneficial, on so many levels.

Buying or purchasing real estate property in the United Arab Emirates is somewhat affordable, compared to other major cosmopolitan hubs in the world. Not to mention the wide selection and the high number of properties that are available, making real estate property a very good choice. And to be able to encourage expats, expat mortgages became a very common option among expats.

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Criteria for Mortgages in the United Arab Emirates

Though the United Arab Emirates have been making life easier for its citizens and even expats, to get mortgages in the UAE, there are certain criteria that need to be met. The criteria include:

· You will have to have a stable job, and you have to be employed at least 6 months or a year ago, depending on the area and the rules that the lender put.

· Self-employed individuals or freelancers must have been running the business for a minimum of 2 years. Some banks might only accept individuals working in specific companies.

· Having a clean credit history.

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Expat Mortgages in the UAE: What Comes After?

When expats decide to get expat mortgages in the UAE, they might have many plans in their mind. They might want to purchase a real estate property and live in it, to be able to save some money that can never be saved if they rent a property. As for the other option, they can purchase a real estate property and decide to rent it out and make some money out of it, since rent in the United Arab Emirates is considered to be expensive.

Also, purchasing a real estate property in the United Arab Emirates can be for commercial or business purposes. One can start a company or use the property as an office for business purposes.

Expat mortgages in the United Arab Emirates are indeed very useful and they open plenty of opportunities. One of the most important benefits is UAE residency, but this of course has certain criteria related to the value of the purchase.

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Why Choose the United Arab Emirates?

Choosing to invest in the United Arab Emirates has always been a potential option. The reason is that this country might offer to its residents what many others can never offer. The benefits of choosing the United Arab Emirates and getting expat mortgages include the following:

· Tax-free income

· Amazing weather all year long

· Safety and security

· Foreseeable future

· Luxury lifestyle

· Rich country

· Many job opportunities

· Low crime and terrorism rates

· High-end education level

· Home for many expats

· Welcomes millions of tourists each year

· Stable marketplace