Compare Best Mortgage Rates in UAE & Dubai, Lowest Rates 2021

Sun, 2020-12-13 17:46
Author: Faizan Amin 

UAE is surely one of the golden lands in the world when it comes to property and real estate developer. The city comprises some of the most coveted, luxurious and high-profile residential and commercial projects. Investing and living here is a very expensive affair for most. Especially for the expats moving in from around the world, instantly owning a property here can be a challenging prospect. 

But as there is a solution to everything, buying a home in Dubai and other emirates can also be achieved with the remarkable financial services available here. Properties can be bought through mortgage financing, with top real-estate companies like DAMAC offering highly convenient in-house solutions for those seeking best living standards. 

What is Mortgage and Why You Should Use It? 

Mortgage financing is a very convenient and easy path to owning a desirable property. Mortgage financing or mortgage loan allows you to purchase properties without paying the full price all at once. You can acquire a debt from the bank, or the real-estate company to purchase the property, and then pay it off with a convenient and pre-planned payment schedule. 

Using a home mortgage loan helps you avoid paying a huge sum of money at the time of purchase. It is ideal for those with a settled monthly income, with which they can be sure of paying off the debt over time. It is also suitable for those who have invested their money in business, or any lucrative investment opportunity, as they can still purchase the property without putting all their money into it. 

The bottom line is, if you find it convenient to pay for a property over the time of a few years, you should go for mortgage finance. 

Mortgage Financing in the UAE

As it is known to all, the UAE has become a global hub in terms of trade, tourism, and several other industries. It also has one of the most helpful financial and legal systems, allowing residents and expats to manage their financials in the most secure, transparent and convenient way.

You will find the most flexible mortgage options in the country, which makes all the desirable properties in UAE within your reach. 

Best Mortgage Rates

All the leading financial institutions offer mortgage facility in the UAE. Along with them, leading real estate firms, like DAMAC, also bring you some useful financing options in collaboration with leading banks and financial institutions. You can make a comparison based on important aspects like Loan to Value Ratio (LTV), Early Repayment Charge, Loan Terms, and most importantly, the interest rates (or Mortgage Rates). 

Best Mortgage Rates for UAE National and Expats

UAE is one country that gives utmost importance to expats which make up a large portion of its population. It is also one of the best countries to reside in terms of financial solutions available to those coming from other nationalities. The UAE nationals and expats can easily avail the lucrative financing options to buy the most luxurious and high-end properties. 

UAE nationals can easily get mortgage finance with up to 90% loan to value ratio, which means that properties can be bought by paying just 10% of the total price. Non-residents, or expats, can get mortgage loans with up to 75% LTV, so they can also finance properties by paying only a fraction of the total price upfront.

Non-residents must know that they can purchase leasehold and freehold properties in selected areas in different Emirates. You will find over 75 freehold areas in Dubai which include top vicinities like Dubai Marina, Palm Jumeirah, Jumeirah Village Circle, Jumeirah Village Triangle, Al Barsha, Downtown Dubai, and Business Bay.

In Abu Dhabi, one can purchase freehold properties in Reem Island, Saadiyat Island, Yas Island, Raha Beach, and Al Reef Village along with other areas. Similarly, there are freehold areas in all other Emirates of the UAE, it is always better to find those areas before you start your search for a suitable property. 

Mortgage Types offered in the UAE

A Mortgage loan comes in different types in terms of interest calculation. The common factor is that a small percentage of the total price is to be paid as down payment, while the rest is paid through easy instalments (EMI). Let’s take a look at some types of mortgages you can find in the UAE. 

Fixed-Rate Mortgage

It is one of the most commonly offered mortgage type. As is evident by the name, it keeps a constant interest rate throughout the loan tenure. The benefit of a fixed-rate mortgage is that the EMI’s for the complete term are constant, so you can always plan your financials accordingly without any hassle. If the rates you are paying is substantially above the market rate, you can apply for refinance rates to get a better deal.

Variable Rate Mortgage

It is also one of the traditionally used and well-known mortgage type with variable rates. The interest rates keep changing according to the Emirates Interbank Offered Rate (EIBOR). The benefit of this mortgage type is that you can end up paying a lesser amount, depending on the EIBOR rate. 

Discounted Rate Mortgage

Discounted Rate Mortgage are the ones in which the banks or real estate developers offer a fixed and below-the-market rate for a certain period within the loan term. This can be very useful as the EMI’s are much lower and easily affordable in the initial phase. If the complete tenure of the loan is within the discounted period, you can save money monthly by availing this type of mortgage. 

Capped Mortgage

Capped Mortgage is a form of variable mortgage, but with an additional advantage. The uncertainty can be worrisome as you are not aware of the interest rates you have to pay. To bring some convenience, financial institutions and service providers put a limit to the rate, so you can know the maximum amount you might have to pay as interest. 

Offset Mortgage

It is the most modern form of mortgage offered by banks and financial institutions. In this type, the principal amount is highly variable, as you can deposit fund and then take them out at will. The interest will only be charged on the outstanding principal amount, allowing the debtors a lot of freedom as in running finance loans. 

Comparing Different Mortgage Rates and Choices

In the UAE, you have the luxury of finding different mortgage solutions offered by different banks and real estate companies . You can check out different aspects of all these offerings, and find the right deal that suits your interests perfectly. Here is a small depiction of current mortgage rates offered by different banks in UAE: 

Best Mortgage Rates

Bank Name

Min Salary

Reducing Rate

Flat Rate

ADIB Bank

AED 15,000

3.75%

2.06%

Standard Chartered

AED 10,000

3.75%

2.07%

RAKBANK

AED 15,000

3.99%

2.09%

Commercial Bank of Dubai CBD

AED 20,000

3.54%

2.18%

ADCB Bank

AED 40,000

4.49%

2.35%

Emirates NBD

AED 20,000

5.75%

3.04%

First AbuDhabi Bank FAB 

 

AED 15,000

7.49%

3.99%

Make the Most Convenient Purchase with DAMAC’s Mortgage Assist

DAMAC is one of the most prominent names in UAE’s real estate industry. It has garnered worldwide fame with its urbane and upscale residential and hospitality projects. Every project delivered by DAMAC is distinguished by its immense focus on the convenience and luxury of its residents. These are some of the reasons why DAMAC’s project are always sought-after by all those looking for a plush lifestyle. 

DAMAC’s properties are worth paying a fortune, and they become even more attractive and appealing when available through exceptional mortgage plans brought to you by DAMAC. The real estate giant has partnered with Abu Dhabi Islamic Bank (ADIB) to bring the best mortgage deal for all property buyers. 

Salient Features of DAMAC and ADIB Mortgage Offer

DAMAC’s properties are now available through one of the very best mortgage plans in the country. You will find a lot of highly attractive aspects in the deal jointly presented by ADIB and DAMAC. Here are the highlights of the service: 

Lowest Interest Rates

ADIB and DAMAC offer an unbelievably low interest rate of just 1.99% for 7 years. This applies to all the properties brought to you by DAMAC. 

No Additional Costs

The service is free from any processing and evaluation fee, ensuring the lowest cost for acquiring a loan to get your dream property. 

Exceptional LTV Ratio

UAE nationals can avail financing for up to 85% of the property value. Expats can get loans of up to 80% of the property price.

Extended Tenure

The maximum loan tenure offered is 25 years. 

With these features, getting a flat or villa in your favourite project is now easier than ever. You can become the owner of a lavish piece of real estate in a matter of days without having to pay the full price up-front. 

Why Choose DAMAC Mortgage Assist?

DAMAC brings you the opportunity to finance your properties with the lowest mortgage rates in Dubai and other cities. Along with that, DAMAC Mortgage Assist make the whole process extremely convenient and hassle-free for the buyers. Here is what you get by using this feature: 

  • Fluent process, with approvals in just 72 hours. 
  • 24/7 support by experienced financial advisors. 
  • Flexible policies for equity release
  • Preferential terms for all buyers. 
  • Direct purchase with least possible paperwork. 
  • Special payment plans ensuring the highest convenience. 
  • No hidden charges or commissions. 

Best Mortgage Rates in UAE

Mortgage Calculator

The mortgage calculator is the easy way for you to find out important aspects before applying for a mortgage. DAMAC brings you this exceptional feature with which you can get an estimation of every detail, including the down payment and EMI in a few seconds. The calculator is easy to use and saves you the time and effort involved in contacting a mortgage advisor to guide you about these aspects. 

How to use the Mortgage Calculator

You can conveniently use the mortgage calculator to get an understanding of important things about your payment plan. You have to enter basic details about the property and your preferences to get the complete picture. Here is what you need to do: 

  1. Enter the price of the property you are interested in financing. 
  2. Select a percentage for the down payment from available options. 
  3. Select a loan term (Life of the loan).
  4. Click Calculate to get the following results:
  5. Down Payment

Monthly Mortgage Payments (Inclusive of the principal amount, interest, and taxes)

Why You Should Invest In DAMAC’s Project through Mortgage?

The most important aspect of this mortgage service is that you get to own a premium property by DAMAC, which in itself is a great benefit. Being a market leader, DAMAC ensures the provision of highest standards of living, with well-crafted communities, lavish interiors and enviable amenities for all residents.

All of DAMAC’s projects have high market demand, as the name commands a lot of trust from all potential property owners. 

With DAMAC’s Mortgage Assist, you can enjoy the best overall financing service, with best mortgage rates, transparency, and flexibility. You cannot find such a great combination of quality and service elsewhere, bringing you the most desirable residential properties in the easiest and most affordable way. So don’t miss out on this rewarding opportunity and apply for a mortgage today. 

Terms and Conditions for Mortgage in UAE

It is advisable to learn about the terms and conditions applied before applying for the mortgage. The terms in UAE are very flexible, so everyone with an adequate monthly income can apply. 

  • All mortgage contracts are regulated through the mortgage laws of UAE and must fall under the designated guidelines. 
  • The mortgages have to be registered with the Real Estate Regulatory Agency (RERA). All the required documents and particulars have to be submitted at the time of registration. Failing to do so will make the mortgage will be deemed as void. 
  • The property to be mortgaged must be legal, and the buyer must also be legally eligible for buying the property following the regulatory laws in UAE. 
  • A non-refundable fee of AED 1000 will be charged for the application. The fee is considered as one of the closing costs in UAE. 

FAQ’s

How to get the best mortgage rates? 

The mortgage interest rate depends on the mortgage bank, as they all offer different rates. For buying a DAMAC property, you can apply for DAMAC mortgage assist to get the lowest mortgage rates. 

What are AAA mortgage loans?

AAA is the highest rating for a mortgage loan service awarded by an independent credit rating agency. 

What credit score is required to get a home loan?

The credit scores can range from 300 to 900. Any credit score above 700 will earn you an approval from the mortgage bank. If you maintain top credit scores the best mortgage rates will be in your reach. 

What are the home loan rates in Dubai? 

Home loan rates in UAE range from 2.99% to 3.55%. You can compare mortgage rates and select the best mortgage interest rates Dubai. DAMAC brings you Dubai best property mortgage has to offer.

What are the different types of mortgage loans? 

The types of mortgages available in UAE are fixed-rate mortgage, adjustable rate mortgage, discounted rate mortgage, capped rate mortgage and offset mortgage. 

Are mortgage rates negotiable?

Mortgage rates are generally non-negotiable. To find the lowest mortgage rates Dubai, comparing mortgage rates offered by different banks can be helpful.

Which bank has the best mortgage rates?

The best mortgage rates for buying a DAMAC property is offered by ADIB Bank through DAMAC Mortgage Assist. By using DAMAC Mortgage Assist, you can avoid the mortgage compare activity and find the best one straight away. 

What is a good mortgage rate?

A good mortgage rate is the one which is less than other mortgage rates offered in the market. DAMAC offers the best mortgage rate for its buyers. 

Are mortgage rates expected to drop?

The mortgage rates can drop depending on the ruling from EIBOR. 

Who can apply for mortgage financing? 

To apply for a mortgage, you need to have a fixed salary or source of income. This allows gauging the capability of paying back the loan. 

How much loan can be acquired through DAMAC Mortgage Assist? 

The finance offered is up to 85% of the property price for UAE nationals and up to 80% for expats. 

Where can the expats buy a property through mortgage?

Expats can use mortgage finance to buy properties in all of DAMAC’s projects located in freehold areas. 

How much time does it take for the loan to get approved?

The loans are approved in just 72 hours, so it is just a matter of few for the process to complete. 

What is the maximum loan term?

The maximum loan term offered through DAMAC Mortgage Assist is 25 years. 

Glossary

There is often difficulty in understanding specific financial terms related to mortgage financing. Knowing them is important to understand the complete process and all the aspects you need to know about it. Here are some important terms explained in the easiest to understand way. 

The Price

This is the total price at which the property is bought. 

Down Payment

The amount you need to pay at the beginning, which is usually a small percentage of the total price.

Mortgage Amount

This is the total finance you will get from DAMAC, which is the total price minus the down payment.

Interest Rate

The interest to be paid to finance the mortgage amount is calculated through this rate. 

Loan Term

The tenure in which the complete price is to be paid. At DAMAC, we offer 5 and 10-year mortgage plans.

Instalment/EMI

This is the amount you have to pay every month. You can get an estimation of this value by using the mortgage calculator. The EMI includes a fraction of the total loan amount and interest to be paid.

For more information about DAMAC's different investment options, please register your details in the form

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"All the information in this blog is published for general information purpose only and belongs solely to the author"
 

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