LTV:

• 90%. For purchases from selected developers for residents or resident expatriates ( Islamic Finance)
• 80% Commercial property finance (Islamic Finance)
• 75% Non-resident expatriates (Islamic & Western Finance )
• 50% UK Bank finance (villas only – no finance for apartments)

Rates:

Rates quoted for Western Finance by local lenders are based on the EIBOR rate which is the reference rate most commonly used by borrowers and lenders to conduct financial transactions in Dubai and the surrounding Emirates. EIBOR is the interest rate charged by banks in the United Arab Emirates for inter-bank transactions. Margins required by lenders are higher in Dubai than elsewhere and are typically 3.5% – 5.5%.above the cost of funds or 3 month EIBOR.

Mortgage Rates for Purchase are LTV banded:

• >50% UK Bank - Base Rate +3.49%
• >55% Local Bank - EIBOR + 4%
• 55% - 65% Local Bank - EIBOR + 4.5%
• 65% - 75% Local Bank - EIBOR + 5.5%

Term:

Maximum term is 25 years from local lenders with the maximum age for employed borrowers being 65 at loan maturity or for self-employed 70 at loan maturity .( Variable Rate Mortgages only)

Fixed rate mortgages from local lenders are available for a term of up to 15 years.

Products:

Both variable and fixed rate products are available from Western lenders for purchase. Western lenders will also offer remortgages or equity release loans but rates are usually 1% higher than for purchase.

Islamic Finance providers offer Ijarah ( Standard Lease) terms on completed property but prospective borrowers should take legal advice on the lease terms which may include a profit share for the lenders in the capital appreciation of the property. Islamic Finance is also available for construction projects on a forward dated Ijarah (lease) contract wherein the customer enters into a lease agreement with the Bank for a property to be delivered at a future date. The Bank will take over the developer's payment schedule and all payments will be made directly to the developer over the construction period. Other types of commercial Islamic finance are available including Istisna to cover construction costs or Murabah to cover the purchase of land.

Affordability:

Affordability must be proven in Dubai and affordability is measured in the UAE as your DBR (Debt Burden Ratio) so your total debt must be less than 40% with the new loan based on 5x annual gross income.