The first thing to do, when it comes to buying a property is to arrange finances. And for this, the most commonly taken route is applying for a home mortgage loan. In Dubai, several banks and private lenders provide different home loans. However, the conditions, eligibility criteria and the rate of interest vary from organisation to organisation.
The option to get a home loan has helped a lot of people realize their dream of becoming a homeowner in the city of gold i.e. Dubai. Be it a lavish apartment in a waterfront development or an exclusive villa in one of the prominent neighborhoods in Dubai, buying a property isn’t difficult, provided you meet the eligibility criteria and have a good credit score.
The process to apply for a mortgage loan in Dubai is fairly straightforward. However, for a first-time buyer, it can get confusing. In this post, we have discussed the entire process to apply for a home mortgage loan in detail and how you can buy a home in Dubai following this method. Read on to know more!
The Process for Buying a Property in Dubai by Financing
Select a Lender/Bank
The process starts with the selection of the bank or lender. As stated above, conditions and prerequisites vary from bank to bank and lender to lender. Thus, make this decision after thorough research. Ask for referrals from those who have pursued this route in the recent past. They can give you a better idea about which lender should be selected. Having said that, do not make the mistake of lending money from a lender who isn’t registered with DLD.
Those who’re new to Dubai, they can take the services of a broker. An experienced and professional broker can provide up to date information on home mortgage deals available in Dubai by banks and other financial institutes.
If you are new to Dubai and do not have enough information on banks and lending companies, you can hire the services of a broker. They have invaluable knowledge and insight, which they can use to provide you with favourable home loan mortgage deals offered by top financial institutes in the region.
Select The Mortgage Type
After you’ve selected the lender, the next step is to select the mortgage type. Different mortgage types are available for those applying for a home mortgage loan in Dubai. They vary with regards to the rate of interest, repayment terms, among other factors.
Just like the selection of the lender, mortgage type must also be finalised after thorough deliberation and research. Take into account your monthly income, the amount and duration of the loan you’re applying for and other vital information before deciding the type.
Get a Pre-Approval Letter
Once the home mortgage type is decided, apply for the loan with the bank/lender. This step involves a lot of paperwork and at the end of this phase, you will have a pre-approval letter, provided the loan has been approved.
Generally, these documents are required by lenders:
- Photocopies of passport, visa and Emirates ID
- Proof of employment
- Bank statement and salary slips for the last six months
- Proof of residence (tenancy contract or DEWA bill)
- Latest credit card statements
Some banks or lenders may also ask for additional documents other than the ones mentioned above.
Once your application has been accepted, you will be given a pre-approval letter. It is an official document that testifies that has the maximum borrowing limit mentioned on it.
Decide the Property and Seal the Deal
After getting the pre-approval letter, you can start sorting through properties for sale in Dubai. Make a list of areas of your interest and then explore the residential projects it nestles. For example, if you’re looking for a residential unit in Dubai Marina, you can consider Stella Maris apartments. It is going to be the last waterfront development in the area that is still under construction but has gained immensely popular.
Contact your lender once you have decided the property to finalise the loan agreement. They will hire a property evaluator who will inspect and evaluate the property to ascertain its value. After getting the evaluation report, the loan amount will be released, and you will become a proud owner of a home in Dubai.