Mortgage is a financial instrument with the help of which you can buy real estate in Dubai. In the article we tell you: for whom mortgage is convenient, what rules of issuance apply in the UAE, who will help with registration. We give calculations so that you can estimate monthly payments and other costs.

Why Mortgages Are Growing

Mortgages in the UAE are becoming increasingly in demand. In 2024, the real estate market reached a volume of 893 billion dirhams, mortgage transactions accounted for about a quarter of this amount. In Dubai alone, 35,000 real estate loans worth AED 187 billion were issued.

One of the main reasons for the popularity of mortgages is favorable rates. In the Arab Emirates, the mortgage rate is one of the lowest in the world – from 3.75% per annum (at the beginning of 2025).

For comparison, we calculated monthly payments in the UAE and the U.S. if the mortgage amount is $100,000, the term is 20 years, and the down payment is 20%:

•  UAE – $470 per month at a rate of 3.75%,
•  USA – $770 per month at 6.99%.

 

Mortgages are beneficial for customers with different goals:

• if you are buying for yourself, you can conveniently spread the payments over time, paying minimal interest;
• if you are investing, the monthly rental income will be about 20-25% higher than payments to the bank.

At the same time, the purchase of real estate worth $205,000 or more will allow you to obtain a resident visa and live in the Arab Emirates for two years. If the object is more expensive than $550,000, you can get a Golden Visa.

Another advantage of the mortgage is that it is available to customers for whom installments are not suitable for the term or budget. Mortgages are available for up to 25 years with a down payment of 20% or more. For installments, you usually need to pay 40% immediately and the remaining 60% over the next 1-5 years.

It is also possible to combine a mortgage with installments. For example, you can make a down payment of 40% and take out a mortgage for the remaining amount.

“Mortgage is a great additional tool for investment. Rental yields average 7%, mortgage rates – from 3.75%. That is, rent overlaps mortgage payments and brings income,” says expert Anton Burjuy from In.ae.

What You Need to Know About Mortgages in Dubai

There are certain rules for mortgage loans in the UAE. Let’s tell you about the main ones.

Conventional or Islamic

Two types of mortgages are available to buyers of real estate in the Emirates: 

• Standard. During the term of the loan, the title to the property is registered with the buyer.
• Islamic. Formally, the property belongs to the bank, and the buyer rents it until he repays the loan and obtains ownership.

“Which mortgage to choose? In my opinion, it just depends on personal preference. If you have certain religious requirements that do not allow you to take a conventional mortgage, obviously Islamic will be a great option,” expert Firuz Khalikdzhanov from In.ae shares his opinion.

Secondary market only

Mortgage in Dubai can be made only when buying already built housing in the secondary market. Exceptions are made only for some large developers, but even with their projects such cases do not happen often. Therefore, we recommend you to focus on secondary housing.

Interest rate

Mortgage interest in Dubai depends on the rate set by the local Central Bank. As of 13.01.2025, the key rate in the country is 4.40%, and you can take a mortgage from 3.75% per annum.

“You have to keep in mind that in Dubai, the rate is fixed only for 3-5 years depending on the bank. If the Central Bank rate goes down, your mortgage rate will also go down. And vice versa. But now the rates are at a high level, so we expect a further decrease,” predicts Anton Burjuy from In.ae

Requirements for borrowers

Different categories of clients can apply for a mortgage in Dubai:

• Residents with official employment in the UAE. For them, the conditions are the most affordable: income from 10-15 thousand dirhams per month, a reliable employer and a good credit history. 

“In the UAE, the credit rating is tracked by the Etihad credit bureau. You can check your score online and get a detailed report for just a few dollars. Income is taken into account when calculating the rating, as well as any bills – such as phone or internet bills. To get a mortgage in Dubai, make sure you have a high credit rating,” recommends Firuz Khalikdzhanov from In.ae.

 

• Non-residents with official employment in the UAE. For such borrowers, the down payment will be from 40%, income from 15 thousand dirhams per month.

“Even if you are not a UAE resident, you can get a mortgage loan of up to 60% of the value of the property. All you need is to meet the requirements of local banks. For residents, the conditions are even more affordable: you can get up to 80%, the interest rate will be slightly lower,” explains Firuz Khalikdzhanov from In.ae.

• Non-residents who do business in the UAE. The mortgage is available even to owners of a small share of the business (from 5%). It is important that the company has been operating for at least 3 years, had a turnover of 2.5-3 million dirhams per year and was profitable.

 

• Non-residents who receive official income in another country. Such clients can apply for a mortgage with a down payment of 40% or more. The income must be from AED 20,000 per month and the length of service at the last place of work – at least 3-6 months, depending on the bank.

 

• Non-residents who own a business in another country. In this case, the customer needs to disclose information about the business to prove their ability to pay. For approval, the annual turnover should be significantly higher than AED 2.5-3 million. The period of operation of the company is from 3 years.

 

In addition to visa availability and income level, the age of the borrower is important. The mortgage can be obtained by buyers not older than 55 years. The debt must be paid before they turn 65.

What Is the Difference Between a Mortgage and an Installment Plan in Dubai

Mortgage and installment are tools to pay for real estate. The main difference is that a mortgage is issued by the bank, while installments are provided by the developer. Here are the other main differences:

 

• The size of the down payment. The mortgage is issued with a 20% down payment, to buy real estate in installments is usually possible with a 40% down payment.

 

• Term. Mortgage can be taken for 20-25 years, installments are usually valid from 1 to 5 years.

 

• Rules. In general, the terms of installments are more flexible, they can be individually discussed with the developer. But the mortgage is quite strictly regulated.

 

• Requirements for the buyer. Buy real estate in installments can be both residents and non-residents. Strict requirements are not imposed, the main thing is to be able to make a 40% down payment. Requirements for mortgage borrowers are stricter. It is important age, resident visa, employment, income.

 

Which UAE Banks Issue Mortgages

The largest financial institutions in the UAE work mainly with mortgage loans. Among them are HSBC, Mashreq, Emirates NBD, Dubai Islamic Bank, First Abu Dhabi Bank.

Requirements for borrowers and terms of loans in different banks may differ slightly. We recommend applying to 2-3 institutions to increase your chances of approval. 

To choose the right banks and get support at all other stages of the transaction, you can contact us. The Inside Realty team will help you choose an object for mortgage, prepare documents and submit applications, and after approval – buy an apartment and rent it out.

What Are the Conditions for Obtaining a Mortgage in Dubai?

The terms of mortgage loans in the UAE differ depending on the category of the borrower.

UAE residents who work in the country and have an income above 10-15 thousand dirhams, can get a mortgage with a down payment of 20%.

For non-residents, the requirements are stricter: monthly income from 15-20 thousand dirhams and the down payment is from 40%.

Monthly payment depends on the cost of housing and down payment. For example, consider the terms of purchase of a furnished and fully ready-to-move-in studio in the complex The Community in the area of Jumeirah Village Triangle. 

 

• The cost – $136 100.
• Down payment – $65,300.
• Monthly payment – $650.

 

Mortgage processing in the UAE takes place in several stages, and with that comes nuances on the amount of the deal, which are worth keeping in mind.

After the client and I choose an apartment, the bank sends an appraisal. And it may be lower than the amount in the contract. Accordingly, the amount that the bank is ready to lend is reduced, and the cost of the down payment is increased. Therefore, if you want to get a mortgage for the required amount, you will definitely need the help of trusted persons”, – says expert Viktoria Butirksaya from In.ae

We know how to avoid complications at all stages. For example, in order to guarantee the right amount of money, we make a preliminary assessment. This allows us to understand whether the object is suitable for the client or not. 

What Payments Need to Be Taken into Account

When buying an apartment with a mortgage, it is also important to consider additional costs:

 

• Broker’s commission – from AED 10,000 to 1% of the mortgage amount.

 

• Apartment evaluation – AED 3,000 on average.

 

• State fee for registering the mortgage with the Dubai Land Department – 0.25% of the mortgage amount.

 

• Insurance – 0.6-0.8% of the property value.

 

• Commission for early repayment – about 1% of the remaining amount.

 

Other additional payments are possible. A broker will help you calculate the total amount.

 

Installment or Mortgage: Which Is More Profitable 

Which instrument is better to use – mortgage or installment – depends on the individual situation of the client. What is important:

• Visa availability. If you do not have UAE residency, buying in installments is easier than taking out a mortgage.

 

• Budget. You can get a mortgage with the first payment from 20%, for installments you will need 40%.

 

• Repayment term and installment payments. Mortgage can be taken for up to 25 years, payments will be lower. However, when buying in installments, the remaining 60% typically needs to be paid within 1 to 5 years, making the payments higher during that period.

 

• Goal. If you need an apartment now, it is worth taking out a mortgage – it is made on ready-made housing. If you buy in installments, you will have to wait for the completion of construction.

 

Who Will Help You Arrange Your Mortgage 

The Inside Realty team will help you get a turnkey mortgage. We will take care of all stages:

1. We will study your goals and possibilities. Check whether you meet the requirements of the bank, calculate the down payment, select objects.
2. We will choose 2-3 banks and submit documents.
3. We will get pre-approval – it will contain your data, loan amount and term.
4. We will choose apartment options within the required budget.
5. We will go through the apartment appraisal procedure. 
6. Prepare the transaction.
7. We will forward the money to the seller or developer within 3 days.
8. We will conduct the transaction. 
9. If necessary, we will help you to rent out the purchased apartment and later sell it.

“Many people are afraid that an apartment with a mortgage is impossible to resell. In fact, there is no problem with this. There are several types of transactions in the UAE: for cash, mortgage and mortgage to mortgage. Yes, the last type of transaction is complicated, but possible. And if such a need arises, we help to solve this problem”, – emphasizes the expert Anton Burjuy from In.ae.