Mortgage processing fees in the UAE
One of the first steps in purchasing a home in the UAE is deciding whether to pay cash or through a mortgage. You might consider a mortgage loan if you're more inclined to financing a purchase by paying back in instalments over time. However, the property purchase price is not the only thing you need to pay to become the owner of the property.
Buying a property in the UAE comes with a range of additional costs and fees. For more information about mortgage-related fees and how much you must pay to the bank for processing a mortgage, read below.
What is a mortgage processing fee?
Property and mortgage-related fees include Dubai Land Department fee, property registration fee, real estate agency fee, Dubai Land Department mortgage registration fee, property valuation fee, etc. In addition to these, when you buy property in the UAE with a mortgage, you should be aware that the banks will charge you a mortgage processing fee. In most cases, these fees cover underwriting, processing, and issuing your loan, preparing documents, conducting an appraisal review, and administration.
The purpose of mortgage processing fees is to compensate lenders for some of the costs they incur while processing your mortgage application. This processing fee varies from bank to bank, but it’s usually up to 1% of the loan amount + 5% VAT.
UAE Banks - Mortgage processing fees
The following table shows the processing fees charged by major UAE banks (loan amount percentage):
Bank | UAE Nationals and Expats | Non-residents |
|---|---|---|
0.75% |
| |
0.5% | 0.5% | |
1% |
| |
0% |
| |
0.5% | 1% | |
0% | 1% | |
1% |
| |
0.5% | 0% | |
0.5% | 1% | |
0.5% |
| |
0% | 1% | |
0.5% |
| |
0.5% | 1% | |
0.5% |
| |
0.5% |
|
Next steps
With this in mind, you are now aware of the mortgage processing fees and percentage you may be charged depending on your residency status (not all banks offer loans to non-residents). It may be interesting to know that you can obtain a Dubai Golden Visa if you purchase a property in Dubai and meet the criteria. Learn more about the process here. As for the overall homebuying process, be it cash or mortgage, read our blog here.
If you wish to know more about mortgages in the UAE, check out our blogs on the mortgage pre-approval letter, fixed vs variable mortgage rates, mortgages for self-employed borrowers, mortgage down payment and mortgage prepayment in the UAE.
Get in touch with our dedicated mortgage advisers if you need advice regarding mortgage options, mortgage rates, bank offers, or anything else mortgage-related.
We’re here to help you. We have a mortgage calculator that allows you to calculate monthly payments and associated costs, or you can sign up and receive personalized mortgage offers, online pre-approval letters, and guidance through the entire process.
Lastly, use our portal to search through 5000 units across 300 buildings/villas or learn more on mortgage offers and home loans for expats in the UAE, UAE nationals or non-residents.
Photo credits:
Mo Ismail | Pexels
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