UAE mortgages....who to avoid?
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I would recommend Standard charterd over HSBC. The rate they are offering is bait just to gain your attention. But I just can't understand who comes with such ideas.Standard chart offers a similar rate but HSBC offers this only for a outrageous 60 % deposit . They generally have some short campaign to entice consumers. However, they generally have a higher rate for lower deposit. They are also very restrictive on properties finance.
I would like add , please ask all the questions, processing fees, about early payment penalty ,life insurance cost and last but not least , what will be the rate for the following years and what is it based on.
BM
I would like add , please ask all the questions, processing fees, about early payment penalty ,life insurance cost and last but not least , what will be the rate for the following years and what is it based on.
BM
Last edited by bigmountain; 13th Dec 2012 at 20:13.
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Did any of you with a recent mortgage have to take property/life insurance from the lender? Or were you able to get your own from elsewhere if it is a 'must have'?
If you went independently do you have any recommendations?
If you went independently do you have any recommendations?
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Easy rider.
If you are looking for a bank that doesn't provide or specify the life insurance product, then, I would suggest UAB . United Arab Bank. They currently offer 3.99% with a fixed period of 3years and then returns to around 6% .UAB will accept your current life insurance policy or if you want to shop around try Zurich life, Salama etc. The good thing about UAB is that they offer no early payment penalty. So after 3 years if some other bank is offering a better rate you can always move. The other good point is that as they are reasonably small, they can usually vary the DBR ( dept Burden ratio) usually 50% of your income , to a higher limit based on your company profile (eekaa) .The negative point about UAB is the 1 % processing fee.
If you don't have any other mortgages in UAE. And basically looking for. Fixed installment amount based on 4.45% for the whole tenure without processing ,fees, including life insurance cover, and no penalty after three years . Then have a look at Abu dhabi Islamic bank. (ADIB) It seems to good to be true.
Couple points to look at
1 you need to get your salary transferred to the bank for Ltv of 85%
2. The monthly installments are fixed , however if the Eibor moves out of the band that they have offered this product , then your tenure is extended. So you know that you payments are fixed, but the EIBOR extends the life of the mortgage
ADIB are a fairly new player so have come out with a fairly innovative product.
I'm sure other banks will follow
Regards
BM
If you are looking for a bank that doesn't provide or specify the life insurance product, then, I would suggest UAB . United Arab Bank. They currently offer 3.99% with a fixed period of 3years and then returns to around 6% .UAB will accept your current life insurance policy or if you want to shop around try Zurich life, Salama etc. The good thing about UAB is that they offer no early payment penalty. So after 3 years if some other bank is offering a better rate you can always move. The other good point is that as they are reasonably small, they can usually vary the DBR ( dept Burden ratio) usually 50% of your income , to a higher limit based on your company profile (eekaa) .The negative point about UAB is the 1 % processing fee.
If you don't have any other mortgages in UAE. And basically looking for. Fixed installment amount based on 4.45% for the whole tenure without processing ,fees, including life insurance cover, and no penalty after three years . Then have a look at Abu dhabi Islamic bank. (ADIB) It seems to good to be true.
Couple points to look at
1 you need to get your salary transferred to the bank for Ltv of 85%
2. The monthly installments are fixed , however if the Eibor moves out of the band that they have offered this product , then your tenure is extended. So you know that you payments are fixed, but the EIBOR extends the life of the mortgage
ADIB are a fairly new player so have come out with a fairly innovative product.
I'm sure other banks will follow
Regards
BM
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"Considerable equity" in a property I feel can be high risk if poorly located.
So choose it's potential sale location well... as located in the wrong place you could become stuck with it... and find it's upkeep in your absence expensive... it's inability to be relocated is frustrating if nobody wants to offer you the market price when your circumstances change and you are required to vacate the country.
Like you say it is all about choices.
So choose it's potential sale location well... as located in the wrong place you could become stuck with it... and find it's upkeep in your absence expensive... it's inability to be relocated is frustrating if nobody wants to offer you the market price when your circumstances change and you are required to vacate the country.
Like you say it is all about choices.
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Once again great reply Big Mountain! I owe you a beer or something!
I literally just got off the phone with ADIB, and I'm quite impressed so far.
4.49% floating rate
No pre application or process fees
No fire insurance
And no life insurance if you borrow 3.5m aed or less
Early settlement 0 if you sell, 3% if you close it early on own
Buy out fee of 3%
Can overpay by 30% per year with no penalties
My only concern is the buyout fee, if you remortgage you have to pay 3% on what's owing.
The only other deal that's near this is mashreq
All very similar but charge for pre approval and processing fee + property and life insurance
I will call UAB see how I get on
Thanks again
ER
I literally just got off the phone with ADIB, and I'm quite impressed so far.
4.49% floating rate
No pre application or process fees
No fire insurance
And no life insurance if you borrow 3.5m aed or less
Early settlement 0 if you sell, 3% if you close it early on own
Buy out fee of 3%
Can overpay by 30% per year with no penalties
My only concern is the buyout fee, if you remortgage you have to pay 3% on what's owing.
The only other deal that's near this is mashreq
All very similar but charge for pre approval and processing fee + property and life insurance
I will call UAB see how I get on
Thanks again
ER
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Easy Ryder
That's where you will have decide after comparing options from various institutions. In any case I would stick with a bank rather than Tamweel and Amlak, as these two don't come directly under the central bank and willy nilly charge what they want. To give you an example Tamweel base rate is currently 7.4 % .. If you wanted to cancel your mortgage you would need to pay a whopping 4 % as early payment charges. However if you apply now you would be offered a low rate to hook you and perhaps lower penalty charges. But Tamweels track record is not really great. I recently tried to find out what my outstanding was with Tamweel and what it worked to was the principal outstanding+ 4% + service fees + additional. Aed 25000. /-.
Above all I find it very odd that none of the Banks or institutions will provide you with a copy of the mortgage contract that you are expected to sign.
The offer letter is given to you ,but that does not cover all the features and requirements of mortgage You will find that the contract will be given to you after you have already made the downpayment for the property and basically left with no room to back out as you have already signed and made a deposit on the property. So please ensure that there is some transparency at every stage.
Surprises to look for ; some banks ask for power of attorney in the banks name. Another odd one , asking for a letter from your company that will not transfer
salary to another bank.
By asking all the questions on this forum, you are doing your do deligence and sure will be able to cover most points but not all. However Dubai is still a frontier market and has just gone through its first ever down cycle. The property market has bottomed out and slowly but surely market is moving. If you have seen something you like and in your budget, I would suggest that you move promptly and also get a preapproval for slightly more than you want ,to offer you some flexibility due to last minute price increase. Prices are rising quickly!
BM
That's where you will have decide after comparing options from various institutions. In any case I would stick with a bank rather than Tamweel and Amlak, as these two don't come directly under the central bank and willy nilly charge what they want. To give you an example Tamweel base rate is currently 7.4 % .. If you wanted to cancel your mortgage you would need to pay a whopping 4 % as early payment charges. However if you apply now you would be offered a low rate to hook you and perhaps lower penalty charges. But Tamweels track record is not really great. I recently tried to find out what my outstanding was with Tamweel and what it worked to was the principal outstanding+ 4% + service fees + additional. Aed 25000. /-.
Above all I find it very odd that none of the Banks or institutions will provide you with a copy of the mortgage contract that you are expected to sign.
The offer letter is given to you ,but that does not cover all the features and requirements of mortgage You will find that the contract will be given to you after you have already made the downpayment for the property and basically left with no room to back out as you have already signed and made a deposit on the property. So please ensure that there is some transparency at every stage.
Surprises to look for ; some banks ask for power of attorney in the banks name. Another odd one , asking for a letter from your company that will not transfer
salary to another bank.
By asking all the questions on this forum, you are doing your do deligence and sure will be able to cover most points but not all. However Dubai is still a frontier market and has just gone through its first ever down cycle. The property market has bottomed out and slowly but surely market is moving. If you have seen something you like and in your budget, I would suggest that you move promptly and also get a preapproval for slightly more than you want ,to offer you some flexibility due to last minute price increase. Prices are rising quickly!
BM
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And no life insurance if you borrow 3.5m aed or less.....
Easy Rider are you sure about this....just going through the process with ADIB at the moment and am paying life insurance for a 2.5m approx mortgage.....
Easy Rider are you sure about this....just going through the process with ADIB at the moment and am paying life insurance for a 2.5m approx mortgage.....
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Apron, I think it's BS, a line used to hook me in..... The formal email made no mention of that
On another note I've also been in touch with a broker, who has basically recommended the same ADIB offer. His fee for the same offer is 20000aed
but has stated he will do all the running around etc to get the deal done and get lawyers to view contracts blah blah and make sure it's all legit.
So my qu is, is that kind of service worth that cash or should I do the legwork on my own?
Thanks again BM
On another note I've also been in touch with a broker, who has basically recommended the same ADIB offer. His fee for the same offer is 20000aed
but has stated he will do all the running around etc to get the deal done and get lawyers to view contracts blah blah and make sure it's all legit.So my qu is, is that kind of service worth that cash or should I do the legwork on my own?
Thanks again BM
Last edited by Easy Ryder; 17th Dec 2012 at 18:21.
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ER
Try mortgage international . They are quite reasonable and did not ask for a fee.
Although this was a few months ago and this was one of the few proposal put forward. You will still have to do the leg work to get all the required paper work, but they do have some sort of relationship with the banks, so usually they are in a position to sort out any surprises for you from the beginning.
Ask for Richard.
Good luck
BM
Try mortgage international . They are quite reasonable and did not ask for a fee.
Although this was a few months ago and this was one of the few proposal put forward. You will still have to do the leg work to get all the required paper work, but they do have some sort of relationship with the banks, so usually they are in a position to sort out any surprises for you from the beginning.
Ask for Richard.
Good luck
BM
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Easy rider ......I'm doing the process direct with adib. The bank seems fine and saves the 20k u mention! Remember, u need to get the paperwork together for a broker anyway, so why not just fax it to the bank yourself 
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Expatriate mortgages to be limited to 50% LTV of property
U.A.E. Said to Cap Expatriate Mortgages at 50% of Home Value - Bloomberg
Expat mortgage cap sends shockwaves across UAE banking sector - Emirates 24/7
Don't buy yet if you've managed to avoid guys n gals......
Expat mortgage cap sends shockwaves across UAE banking sector - Emirates 24/7
Don't buy yet if you've managed to avoid guys n gals......
Last edited by Easy Ryder; 31st Dec 2012 at 08:08.
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I think it will do the exact opposite. This recent mini recovery and subsequent rise in Dubai property values seems to have been driven largely by end users. Forcing them out of the market creates less demand and fewer transactions. I think we will see more properties sitting unsold on the market and being converted back into rentals. Makes you wonder why they instituted this law so early in the recovery. Are they trying to inject more liquidity into the local banks?
It's easy to forget that Dubai is a place where the rules change overnight and the playing field is rarely level.
It's easy to forget that Dubai is a place where the rules change overnight and the playing field is rarely level.
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I think the UAE banks like those in Europe and the UK and are probably bust... the UAE Central Bank action obviously indicates they feel their banks have a problem.
The UAE has an insufficiently large tax payer base to bail their banks out.
Exchange control on the amount of non national money allowed to leave the country if they follow the same route as Kenya.... not good news for pilots or airlines or anyone based there.
The UAE has an insufficiently large tax payer base to bail their banks out.
Exchange control on the amount of non national money allowed to leave the country if they follow the same route as Kenya.... not good news for pilots or airlines or anyone based there.