Dubai Sports City Blog

DSC News & Updates

New Mortgage Rule: 80% of unit value for Emiratis, 75% for Expats

Posted By on October 29, 2013

New Rules will be enforced one month after they are published in official gazette.

The UAE Central Bank has finally issued a mortgage lending system that allows the country’s banks to provide a loan of up to 80 per cent of the property value to Emiratis and 75 per cent to expatriates.

A statement by the Central Bank stressed that the 23 national banks and 28 foreign units operating in the second largest Arab economy must take into consideration the debtor’s eligibility and financial resources.

The new rules released by the Central Bank on Monday will be enforced one month after they are published in the official gazette this week.

It also told banks to ensure they would not give loans that exceed 50 percent of the client’s monthly income.

The new rules stipulated that mortgage loans to Emiratis must not exceed 80 per cent in case the property value is Dh5 million or less.

The loan must be cut to a maximum 70 percent in case the property value is above Dh5 million.
Loans to expatriate clients must not exceed 75 per cent of the property value of Dh5 million or less and 65 per cent if the property value is more than Dh5 million.

As for clients buying property before construction or on the map, the maximum loan they can get is 50 per cent of the unit’s value.

The law set a maximum period of 25 years for a mortgage loan provided that the Emirati debtor must not exceed 70 years of age when repaying the last installment of the loan. As for expatriate clients, the law set the maximum age at 65 years.

“The Central Bank, by issuing this new system, wants to ensure all banks and financial institutions in the country have authorised and credible business criteria and effective frameworks that will control their mortgage loans,” Central Bank governor Sultan bin Nassir Al Suwaidi said on Monday.

Source: Emirates 24/7


Leave a Reply

Please note: Comment moderation is currently enabled so there will be a delay between when you post your comment and when it shows up. Patience is a virtue; there is no need to re-submit your comment.