Right after the government gave thumbs up to the free holding of property by expats in the country, mortgages came into the scene to enable easier purchase of property .After the updated 2008 regulations, mortgages can only be sold by registered financial institutions and have to be insured. Until 2008, up to 90% of the purchase price or valuation was offered based on the credit rating of the purchaser. However, since the recent financial crisis, this has been cut down to a maximum of 75% of the price of evaluation.
These loans can be paid back on a monthly instalment basis, within a period of 25 years. The interest rates comply with the international norms though it’s usually a little higher for expats. The mortgage amount given depends on various factors and is usually 60 times the total household income. Recently, some of the banks have started offering something called a ‘pre-approved home finance’, which implies that you get assurance of a loan even before you set out on buying a property. This makes the process hassle free and also gives you the added security of knowing that you will have a mortgage once you spot that perfect piece of property you fancy. Banks are very partial about whom they give a loan to. Each bank usually has a set of favourite developers whose property gets faster loans than others. Hence, when choosing a bank to get a loan from, make sure it lends to your choice of developer.
Vehicle Finance
Loans are also available for purchasing vehicles. Most car dealers, whether you are buying a new or second hand car, will arrange loans for you with their favoured bank. Do not always go by the dealers words. Try to keep abreast of the terms and conditions and try speaking directly to a bank if they can offer you much better rates than the car dealer’s bank. For repaying the loans, banks can now set up automatic monthly transactions from your account, which makes writing out and posting of monthly cheques unnecessary.
Leading Banks offering various kinds of Loans and Mortgages
ADCB, Barclays, Citibank, Dubai Islamic Bank, Emirates Bank, First Gulf Bank, HSBC, Mashreq Bank, RAK Bank, RBS, Standard & Chartered etc
