Buying a home in Dubai as a foreigner can feel overwhelming—especially when you’re trying to navigate unfamiliar banking terms, new legal processes, and the excitement of investing in one of the world’s fastest-growing real estate markets. Whether you’re living overseas or have recently moved to the UAE, understanding how mortgages work is the first step toward making a confident, well-informed property purchase. This guide breaks down the entire system in simple, practical language—from mortgage eligibility and EIBOR-based interest rates to bank requirements, documentation, and the exact steps involved in securing finance and completing a property transfer. By the end, you’ll know precisely how to get a home loan in Dubai as a foreign buyer and what to expect at every stage of the journey.
Here’s a full, step-by-step guide to getting a home mortgage in Dubai as a foreigner, written as if you’re starting from absolute zero.
1. First Basics: Can a Foreigner Even Buy With a Mortgage in Dubai?
Yes.
Dubai allows foreigners (even non-residents) to own property on a freehold basis in specific “designated freehold areas” such as Dubai Marina, Downtown Dubai, Palm Jumeirah, JVC, Business Bay, Dubai Hills, Dubai Creek Harbour and many others.
Under Law No. 7 of 2006, foreigners can own freehold property in these zones, and the Dubai Land Department (DLD) registers and protects your ownership.
On top of that, many UAE banks do lend to foreigners, including non-residents living abroad. Examples (just so you see it’s real, not theory):
HSBC UAE – specific non-resident mortgage products, typically up to 60% LTV for non-residents.
Mashreq – non-resident home loan up to 60% of property value, up to AED 10 million, 25-year tenure.
ADCB – up to 80% for expats and 50% for non-residents, with fixed+variable (hybrid) options.
Dubai Islamic Bank (DIB) – non-resident home finance programme with competitive profit rates.
So as a foreigner, you can:
Buy in designated freehold areas
Finance the purchase with a UAE mortgage
Do this either as a UAE resident or a non-resident (living overseas)
2. How Mortgage Interest Actually Works: EIBOR + Margin
Most Dubai mortgages are variable (floating) and are priced as:
EIBOR + Bank Margin
What is EIBOR?
EIBOR (Emirates Interbank Offered Rate) is the UAE’s official benchmark interest rate. It’s:
The rate at which UAE banks lend to each other
Published daily by the Central Bank of the UAE
Used as a reference rate for loans like mortgages, personal loans, car loans, etc.
Think of EIBOR as the “base cost of money” in the UAE.
There are different EIBOR tenors (overnight, 1M, 3M, 6M, 12M). For mortgages, banks commonly use 3-month or 6-month EIBOR.
What does “EIBOR + Margin” mean?
The bank adds its own margin (spread) on top of EIBOR.
Example:
3-month EIBOR today (just as an example): 5.0%
Bank margin: 1.75%
Your mortgage rate: 6.75% per year on reducing balance
Every time EIBOR is reset (say every 3 months), your rate is recalculated:
If EIBOR goes up → your rate and EMI go up
If EIBOR goes down → your rate and EMI go down
So EIBOR moves with global interest rates (especially US Fed decisions, because AED is pegged to USD), and your mortgage follows.
3. Fixed, Variable and Hybrid rates – What Will Your Rate be Like?
In Dubai, banks usually offer three styles of pricing:
a) Fixed-rate period (1–5 years)
Here, your rate is locked for an initial period (often 1, 2, 3 or 5 years).
Your EMI stays the same during the fixed period
After the fixed period, the loan usually switches to EIBOR + margin (variable)
Example:
“4.99% fixed for 3 years, then 3-month EIBOR + 1.75%”
Good if you want stability and you’re worried rates might rise soon.
b) Pure variable (floating) from day one
Right from the start, your rate is EIBOR + margin, for example:
3M EIBOR + 1.75%
Reviewed (reset) every 3 months
Good if you believe rates will fall or stay stable, and you’re comfortable with EMI changes.
c) Hybrid (Fixed + Floating)
This is very common in Dubai:
Fixed for the first few years
Then switches to EIBOR + margin afterwards
For example:
2 years fixed @ 4.75%
Then variable at 3M EIBOR + 1.75%
This gives you initial certainty with long-term flexibility.
4. How Much Can You Borrow? LTV Rules for Foreigners
Central Bank caps (Broad Rules)
The UAE Central Bank issues regulations that cap LTV (Loan-to-Value) ratios. For expatriates buying their first property in the UAE, a common interpretation is:(Rulebook)
Up to 75% LTV for properties ≤ AED 5 million
Up to 65% LTV for properties > AED 5 million
For second or investment properties, many banks cap at around 60% LTV
For off-plan properties (under construction), Central Bank guidelines and industry practice typically cap LTV at 50% due to higher construction risk.
These are maximums. A bank can always offer less if your profile is weaker.
Non-resident specific caps
If you live outside the UAE and apply as a non-resident:
Mashreq non-resident loan: up to 60% LTV.(Mashreq Bank)
HSBC non-resident: marketing material talks about low down payment, but the generally practised is up to 60%.
ADCB standard mortgage: up to 50% for non-residents.
Market guides for non-residents generally quote a 60–65% LTV ceiling.
So, as a rule of thumb:
Resident expat: assume up to 75% LTV for the first, ready home
Non-resident: assume 50–60% LTV
You must finance the rest as a down payment, plus pay all fees.
5. What Banks Check Before They Say “Yes”
Every bank will run through a similar checklist.
a) Debt Burden Ratio (DBR)
The DBR is your total monthly debt payments divided by your gross monthly income.
The UAE Central Bank says your DBR cannot exceed 50% to qualify for a loan.(Rulebook)
That means:
All EMIs (home, car, personal loans + 5% of each credit card limit) must be ≤ 50% of your monthly income.
If this goes above 50%, the bank must reduce your loan amount or refuse the application.
b) Credit history
Banks will check your credit report:
If you’re a UAE resident, they pull your AECB (Al Etihad Credit Bureau) report.
As a non-resident, they may rely on:
Your home-country bank statements
Employment details
Sometimes, foreign credit reports (depending on the country)
A clean history with no defaults, late payments, or bounced cheques makes approval easier and can help you negotiate a better margin.
c) Income and employment stability
Banks look at:
Type of employment – salaried vs self-employed
Employer – large, known employers often treated more favourably
Length of service – typically want 6–12 months in current job or track record if self-employed
Minimum income – varies by bank; many want a minimum monthly income (for example AED 10k–15k for residents; non-residents often higher)
You prove all this via a salary certificate, an employment contract and 6-month bank statements.
d) Property valuation
The bank orders an independent valuation to make sure the property price is realistic.
Typical valuation fee: around AED 2,500–3,500.
The LTV is applied to the lower of:
The valuation
The purchase price
So, if you over-pay compared to the market, the bank may lend less than you expected.
e) Age and Loan Tenure
Most banks require:
Minimum age: 21
Maximum age at loan maturity: usually 60–65 for salaried, up to 70 for self-employed (varies by bank).
Maximum tenure is usually 25 years for residents and often 15–25 years for non-residents.
f) KYC / AML and Source of Funds
Because of anti-money-laundering rules, the bank must understand:
Where your down payment is coming from
Your country of tax residence
Whether there are any sanctions or red flags
You’ll share bank statements, sometimes tax returns, and other documents as requested.
6. The Actual Step-By-Step Process (From Zero to Keys in Hand)
Let’s walk through what typically happens.
Step 1 – Decide Your Budget
Before you look at property:
Decide how much down payment you can afford.
Plug in rough interest rates and tenure to estimate your EMI.
Make sure your DBR stays under 50%.
A quick rule:
For a 25-year loan, every AED 1 million of loan at ~6–7% interest creates an EMI of roughly AED 6,500–7,000 per month (ballpark).
Step 2 – Get a “Pre-approval” (Approval in Principle)
Almost all banks and international players like HSBC, ADCB, DIB, etc., offer pre-approval (also called Approval in Principle).
You submit:
Passport (and visa/Emirates ID if resident)
Salary certificate or proof of self-employment
6-month bank statements
Details of current loans & credit cards
The bank then:
Checks DBR, income, and credit history
Gives you a maximum loan amount and tentative rate
This usually takes a few working days if your file is complete. Many banks now do this partially online.
Pre-approval is usually valid for 60–90 days, giving you a budget while you go property hunting.
Step 3 – Choose your property
Now you:
Shortlist areas (must be freehold zones for foreign ownership)
Pick the project (ready or off-plan)
Negotiate the price with the seller or developer
For a ready property (secondary market), you’ll usually:
Sign an MoU (Form F) with the seller
Pay an initial deposit (often 10%) held in escrow/at a trustee
For off-plan, you sign a Sale & Purchase Agreement (SPA) with the developer and follow the instalment plan.
Step 4 – Bank valuation
Once you have the signed MoU/SPA, you ask your bank to start the valuation:
Bank appoints a valuer
The valuer visits the property or uses data to estimate the market value
You pay the valuation fee (approx. AED 2,500–3,500).
If the valuation comes in lower than your agreed price, the bank will base LTV on this lower number. You may then have to increase your down payment.
Step 5 – Final Approval and Signing the Offer Letter
The bank now issues a final mortgage offer letter with:
Final loan amount
Interest rate (fixed or EIBOR + margin)
Tenure
All fees & charges
You read this carefully and sign. Some banks allow digital signing now.
Step 6 – Registration and Transfer at the Trustee's Office
For Dubai, registration happens either at a Dubai Land Department trustee office or via DLD’s digital platforms.
At transfer, you:
Pay DLD transfer fee – 4% of purchase price + small admin fee
Pay mortgage registration fee – 0.25% of the loan amount + admin fee (around AED 250–290)
Pay agency/broker fee (commonly 2% of price, unless a developer's direct deal)
Pay any developer NOC fee (AED 500–5,000) for secondary sales
The bank sends the loan funds directly to the seller/developer. DLD then issues a title deed in your name (and shows the bank’s mortgage).
From this point, you’re the legal owner, and the bank has an interest (mortgage) registered against the property.
Step 7 – After You Buy: Payments, Insurance, Early Settlement
Monthly, you pay your EMI (principal + interest/profit). On top of that:
You must maintain property insurance (buildings insurance) – often bundled via the bank
Many banks also require life insurance/takaful linked to your loan
If someday you want to repay early or refinance:
The early settlement fee is capped by regulation at 1% of the outstanding loan or AED 10,000, whichever is lower.
7. What Documents You’ll Typically Need?
Exact lists vary by bank, but roughly:
For Everyone
Passport copy (and visa page if applicable)
Proof of address in your home country (utility bill, bank statement, etc.)
6-month bank statements showing salary credits and general transactions
If you are a UAE Resident
Emirates ID and residence visa copy
Salary certificate or employment contract
AECB credit report (the bank usually pulls this itself)
If You are a Non-Resident
Passport
Last 6–12 months of bank statements
Employment letter mentioning salary, designation & joining date
Sometimes, tax returns or payslips, depending on the country/bank
Completed KYC forms
Property Documents
For ready property: Title deed copy, SPA / Oqood (if new), NOC from developer, MoU (Form F)
For off-plan: SPA, payment schedule, Oqood registration (pre-title record)
Banks like HSBC openly list key document requirements for approval-in-principle and full application.
8. Legal and regulatory points you should understand
Freehold vs leasehold
Foreigners can buy freehold only in designated areas, with full ownership and the right to sell, lease, or bequeath.
Outside these zones, they may access usufruct or long-lease rights, but that’s a different structure.
Mandatory registration with DLD
All property transactions must be registered with the Dubai Land Department; unregistered transactions are not legally effective.
Service charges
An apartment or townhouse in a community will have annual service charges approved by RERA for the maintenance of common areas.
Visas & residency
Property over certain thresholds (e.g. AED 2 million and above) may qualify the owner for a long-term “Golden Visa”, but this is a separate process and not automatic.
9. What Does it All Cost Beyond the Purchase Price?
Rough guide for a ready property in Dubai:
4% DLD transfer fee on purchase price
0.25% mortgage registration fee on the loan amount + about AED 290 admin
Bank processing/arrangement fee – often 0.5–1% of the loan
Valuation fee – approx. AED 2,500–3,500(mortgagefinder.ae)
Broker fee – typically 2% of purchase price (in resale market)
NOC fee – AED 500–5,000 (developer-dependent)
Life and property insurance – ongoing annual cost
You need to budget for these over and above your down payment.
10. Common Beginner Mistakes (and How to Avoid Them)
Looking at Property Before Getting Pre-approval
Result: you fall in love with something you can’t finance.
Fix: Get pre-approved first, then shop within that budget.
Ignoring DBR and Other Existing Loans
If your DBR is already high, the bank will cut your loan amount or reject the file.
Fix: Pay down expensive loans/credit cards before applying.
Not Calculating the Total cost (fees + service charges)
Only looking at EMI, ignoring DLD fees, valuation, service charges, etc.
Fix: prepare a complete cost sheet (I can help you structure this).
Choosing the Wrong Rate Structure
All fixed when rates are likely to fall, or fully variable when you can’t handle payment jumps.
Fix: consider a hybrid: fixed for 2–3 years, then EIBOR + margin.
No Plan for Early Settlement or Refinance
Remember there’s a 1% or AED 10k cap on early settlement fees – useful if you later refinance at a lower rate.
11. Putting it Together in Simple Language
If you’re a foreign first-timer, the journey usually looks like this:
Understand Basics – Foreigners can buy freehold in designated areas and take mortgages from UAE banks.
Learn the Pricing Language – Your rate will likely be EIBOR + margin, sometimes fixed for a few years first.
Check Your Finances – Is your DBR under 50%? How much down payment and fees can you really afford?
Get Pre-approval – So you know your maximum loan and are taken seriously by brokers and sellers.
Pick a Freehold Property – Ready or off-plan, in a good community.
Let the Bank Value it and Issue Final Approval – They check the property, documents and your profile.
Complete Transfer and Mortgage Registration at DLD – Pay government fees and bank fees; the bank pays the seller.
Move In or Rent it Out – Start your EMIs and look after your asset.
Ready to buy your dream home in Dubai but unsure where to begin with financing? Let our experts guide you through every step—from mortgage pre-approval to handover—so you make the right investment with confidence.