For many residents and investors, buying a home in the UAE is a major financial goal—and obtaining a mortgage in Dubai is often the first step toward achieving it. One of the most common questions asked by prospective buyers is: How much can I borrow with a mortgage in Dubai?
The answer depends on several factors, including your income, residency status, financial commitments, and the property value.
Key Factors That Determine How Much You Can Borrow
1. Loan-to-Value Ratio (LTV)
The Loan-to-Value ratio is a critical element in determining how much you can borrow. In Dubai, this ratio is regulated by the Central Bank of the UAE. Here's how it typically works:
UAE Nationals:
Up to 80% of the property value for properties under AED 5 million.
Up to 70% for properties over AED 5 million.
Expats:
Up to 75% for properties under AED 5 million.
Up to 65% for properties over AED 5 million.
For off-plan properties, LTV is capped at 50%, regardless of nationality.
Example:
If you're an expat buying a ready property worth AED 2 million, you can potentially borrow up to AED 1.5 million, and you'll need to cover the remaining AED 500,000 as a down payment.
2. Your Income
Your monthly income is a primary factor in determining the maximum loan amount. Banks in Dubai usually ensure that your total monthly debt obligations—including the new mortgage—do not exceed 50% of your monthly income.
Example:
If you earn AED 25,000 per month, your total monthly debt repayments (including mortgage, car loan, credit cards, etc.) should not exceed AED 12,500.
Self-employed individuals may face more scrutiny, and banks will typically look at average income over the last 2-3 years, supported by bank statements and financial records.
3. Existing Financial Obligations
Before approving a mortgage in Dubai, lenders check your credit report and outstanding financial obligations. If you have high existing debt—like personal loans or large credit card balances—your borrowing power may be reduced.
Tip: Reduce your debt before applying for a mortgage to improve your loan eligibility.
4. Tenure of the Mortgage
Most mortgages in Dubai offer repayment terms between 5 and 25 years, with a few banks extending to 30 years. The longer the tenure, the lower your monthly repayments—but the more interest you’ll pay over time.
Some banks also cap the mortgage term based on the borrower’s age. For instance, the loan should be repaid by age 65 for salaried employees and 70 for self-employed individuals.
Estimating Your Borrowing Capacity
You can use online mortgage calculators to get a rough estimate of how much you can borrow. These tools typically require inputs like:
Monthly income
Existing monthly debts
Desired loan term
Interest rate
However, for the most accurate assessment, it's best to get pre-approval from a bank or consult a mortgage broker in Dubai.
Additional Costs to Consider
When applying for a mortgage in Dubai, keep in mind the extra costs involved:
Down payment (minimum 15%-35%)
Bank processing fees (up to 1% of loan value)
Property valuation fees
Dubai Land Department (DLD) registration fees (4% of property value)
Agency and legal fees
Be prepared to have an additional 7-8% of the property value available in cash to cover these expenses.
Final Thoughts
How much you can borrow with a mortgage in Dubai depends largely on your financial profile, the property you’re buying, and Central Bank regulations. To improve your borrowing power, maintain a clean credit history, limit existing debts, and save for a solid down payment.
Securing the right mortgage in Dubai not only helps you buy your dream property, but also ensures long-term financial stability. Speak with a mortgage advisor to explore your best options and make your home ownership journey as smooth as possible.
