Revealed: Which professions on 'watch list' for home loans in UAE

Getting a home loan in the UAE is not that easy for every professional.

Particularly if one is a lawyer, diplomat, real estate agent and employee of a construction firm.

The above four categories fall on a ‘watch list’, according to bankers, who add that there are strict guidelines in place when processing home loan applications for professionals falling under these categories.

“We have very strict guidelines, especially when it comes to diplomats, lawyers, real estate agents and construction company employees.

“They don’t get loans like a normal salaried person,” said a senior local banker on conditions of anonymity.

“If we do approve their applications, they have to pay a higher down payment,” he added.

Particularly for real estate agents, bankers said, they have to furnish at least two years proof of service for their applications to be accepted.

K Suresh, an Indian real estate agent, says: “I earn more than Dh25,000 per month in commission, but banks refuse to accept my application for home loan.

“We bought a property in Dubai a few months back on home loan, but that was possible only because my son, who works with a private company applied for the housing loan.”

An owner of real estate agency also admitted that he found it difficult to get bank financing.

“Even though I run a real estate brokerage firm, many banks refused to a sanction home loan for me.

“After trying with many banks, one agreed but I was asked to pay a down payment of 40 per cent,” he revealed.

Late last year, the UAE Central Bank issued the new mortgage cap, restricting loan-to-value (LTV) ratio at 80 per cent of the property value for Emiratis and 75 per cent for expatriates.

LTV ratio for second and subsequent homes or investment property is fixed at 65 per cent of the value of the property, regardless of value.

The new law puts maximum length of mortgage loan at 25 years and maximum age of the borrower at the time of payment of the last installment at 70 years for citizens and 65 years for non-citizens (or 70 years if the borrower works for the benefit of himself).

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