Dubai mortgages and home loans for non-residents: US guide

If you want to buy property in Dubai, you can pay in cash or take out a mortgage. The good news is that it’s perfectly possible for a foreign resident to get a Dubai mortgage, whether you’re looking for an investment or a new family home.

This handy guide covers which banks offer mortgages and home loans in Dubai to non-residents, the paperwork you'll need to get your loan, the legal ins and outs, and what it might cost.

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Can a non-resident get a mortgage in Dubai?

Yes, it’s possible for a non-resident to get a mortgage in Dubai. However, it can be trickier than for Dubai residents.

You’ll need to show extensive proof of income. You can also expect to have to pay a hefty down payment - at least 25% of the total cost of your property.¹

What are the legal requirements to get a mortgage in Dubai as a foreigner?

Since a change in the local law in 2002, foreigners can legally buy property in Dubai and apply for a mortgage. This fuelled a big rise in expats buying homes in Dubai, either for themselves or to rent out for extra income.

Individual banks set their own terms, and not all of them will work with foreign buyers. However, it’s still possible to get a Dubai mortgage.

The most important thing that banks look for is your income. Generally speaking, you need to make at least 15,000 AED (~4,000 USD) per month to qualify for a mortgage.¹ If you’re self-employed, your income proof may need to be higher than if you were a salaried worker.

Dubai Golden Visa

Buying property in Dubai can open a path to UAE residency.

Purchasing property for 2 million AED (~545,000 USD) allows you to apply for a 10-year Golden Visa. If you buy property for 750,000 AED (~204,000 USD), you can get a 2-year residency visa.²

Wondering how much does it cost to buy a house in Dubai? Learn more about buying property in Dubai in our full guide.

What types of mortgages are available in Dubai?

The mortgage market in Dubai is well-developed. There are dozens of mortgage providers, from globally known brands to local financial institutions.

There are two main types of mortgages available in Dubai: fixed-rate mortgages and variable-rate mortgages.

Fixed-Rate Mortgages

With these mortgages, the interest rate stays the same for a set period of time, usually between 1 to 5 years. Your monthly payments are more predictable, but the interest rate is typically higher. After the set period ends, the mortgage reverts to a rate set by your bank.

Variable-Rate Mortgages

The interest rate on variable-rate mortgages changes based on market conditions. Your monthly payments will vary, but your interest rate will typically be better than with fixed-rate mortgages.

Read further
Guide to international mortgage lenders Funding your overseas property purchase guide Overseas property mortgage: explained

Property insurance

Property insurance is typically required in Dubai when taking out a mortgage. It safeguards your property’s value against potential damages.

There are two types of property insurance: property insurance and home contents insurance.

Property insurance (also known as building insurance), covers the structure of the property itself. Home contents insurance covers the personal belongings within your apartment or house.

While property insurance is typically mandatory, home contents insurance is optional.

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Now that we covered the basics of getting a mortgage in Dubai, you might be wondering: how to send money to pay for your property overseas?

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How much can you borrow for a home loan in Dubai?

There’s a restriction on the amount of mortgage you can legally be offered. As an expat buyer, your mortgage can’t be more than the total amount you can expect to earn in 7 years.³

Dubai mortgage rates

Dubai mortgage rates vary depending on the specific lender. Typically, you can expect them to range between 3% to 5% as of February 2024.⁴

Should you go to a bank or use a broker?

You can arrange your loan directly with a bank or loan originator or have a broker help you do it.

Working directly with a bank is a great option if you have a clear understanding of your eligibility and the type of mortgage you need. Banks often have dedicated mortgage advisors who can guide you through the process, too. This approach can help you save on fees since there’s no intermediary involved.

If you’re unsure of your eligibility for a mortgage, it might be a good idea to take expert advice from a qualified mortgage broker. Mortgage brokers can help you compare interest rates, terms, and fees from various institutions and potentially find a better deal.

What are the major banks in Dubai providing mortgages to foreigners?

Most major banks in Dubai offer mortgage products, with a reasonable choice of loans which are suitable for expats and non-residents.

You might be able to get a local mortgage with one of the following brokers or banks:

• Global banking giant HSBC has a good range of mortgage products for Dubai, including some which are suited to expats looking to invest in Dubai without living there
• Mashreq is a UAE-based bank which has mortgages for expat residents and non-residents
• Emirates NBD is another good choice for a wide range of mortgage and loan products
• If you’re not sure what type of mortgage you want, check out mortgagefinders.ae for advice and offers from up to 20 different banks

What documents do I need to get a mortgage in Dubai as a non-resident?

The exact paperwork you'll need depends on the bank you use. However, you can expect to be asked for the following:

• Your personal identification documents (passport)
• Proof of legal residence in Dubai and evidence of your current residential address
• Proof of legal residence in Dubai and evidence of your current residential address
• Documents to prove you're creditworthy (bank statements, proof of your wages, tax returns or a letter from your employer)
• Documents to prove the affordability of the mortgage

Getting your mortgage arranged in Dubai shouldn’t take more than a couple of weeks, but it’s a good idea to plan in advance.

Getting a mortgage in Dubai: step-by-step

To get a mortgage in Dubai, you’ll typically need to follow these steps:

1. Decide if you want to use a bank or a broker to explore your options for a mortgage
2. Find a qualified local lawyer to help with the transaction
3. Choose a mortgage that suits your needs
4. Hand over the requested paperwork to get a finance pre-approval
5. Receive a letter from your bank confirming what they will lend you
6. Find a property within your budget and agree on a purchase price with the seller
7. Pay your deposit to secure the sale and agree on a completion date
8. Provide any additional documentation needed to confirm your mortgage.

Just like that, you can now buy your dream home or investment property in Dubai. You might consider also opening a bank account in Dubai.

Dubai mortgage additional fees

There are no property taxes in Dubai, but you will have to cover some administrative and legal fees. Typical fees include the following:

• Mortgage registration fee: 0.25% of the value of the mortgage⁵
• Bank fees including processing fees, property valuation fees, and insurance registration fee
• Loan protection insurance (mortgage life insurance)

Loan protection insurance is usually compulsory. The costs vary wildly depending on the value of your property and mortgage, and your circumstances.

You’ll also have to make a large deposit, at least 25% of the total cost of your property.¹

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Getting a Dubai mortgage or home loan is possible, but it can be tricky for foreigners. It’s important to do your research and have a convenient way of sending money from your main account to Dubai.

Wise can help. From making the down payment to easily converting between USD and AED, use high-speed transfers* to buy your new home in Dubai with no hidden fees or exchange rate markups.

*The speed of transaction claim depends on funds availability, approval by Wise’s proprietary verification system and systems availability of our partners’ banking system, and may not be available for all transactions

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Sources:

1. Property Finder - How much do you need to earn to buy a property in Dubai?
2. Immigrant Invest - UAE residence visa
3. Property Finder - How much can I borrow? Mortgage in Dubai
4. Compare Mortgages - What are the current mortgage interest rates in UAE?
5. Fam Properties - What are the DLD charges in the UAE?

Sources checked 07.31.2024