How Much Can I Borrow-Mortgage - UMA Properties
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How Much Can I Borrow-Mortgage

Posted by umaproperties on December 4, 2023

How Much Can I Borrow? – Mortgage in Dubai

Are you thinking about purchasing property in Dubai and curious about how much you could borrow for a mortgage? We had a conversation with Brendan Kennelly, a knowledgeable mortgage consultant from Mortgage Finder, to provide you with a comprehensive understanding of your mortgage borrowing capacity in the UAE.

In this article, Brendan will discuss various factors that determine how much you can borrow for a mortgage in Dubai. The topics include:

  • Elements Influencing Your Mortgage Borrowing Capacity in Dubai
  • Methods to Precisely Calculate Your Mortgage Borrowing Potential
  • The Importance of the Loan-to-Value Ratio in Mortgage Agreements
  • Ideal Balance Between Salary and Monthly Mortgage Repayments
  • Maximum Duration of Loans in the UAE
  • Relationship Between Property Appraisal and Loan Amount
  • Explaining the Mortgage Stress Test
  • Frequently Asked Questions (FAQs) on Mortgages in Dubai


1. What Are the Factors That Impact How Much I Can Borrow for a Mortgage in Dubai?

Factors Affecting Your Mortgage Borrowing Limit in Dubai:

The Central Bank of the UAE stipulates that the maximum mortgage amount is determined primarily by two factors:

  1. Your mortgage cannot exceed seven times your annual income, which is equivalent to 84 months.
  2. The total of all your liability repayments, including mortgage, car loans, personal loans, credit cards, etc., must not surpass 50% of your monthly salary.

Calculating Your Mortgage Borrowing Capacity:

The quickest method to estimate your borrowing limit is by using an affordability calculator. This tool considers your monthly earnings, existing debts, and your upfront payment capability to determine which properties are within your financial reach.


Consulting an expert mortgage advisor is advisable for unbiased guidance. They can clarify all terms, conditions, and intricate details of various mortgage options, enabling you to make a well-informed decision and avoid unexpected complications.

For further understanding of the UAE’s mortgage market, tune in to the ‘Home Finders’ podcast episode by Property Finder.

Understanding Loan-to-Value (LTV) in Mortgages:

The Loan-to-Value ratio is a key metric in mortgage financing, indicating the proportion of the property’s value that you can borrow.

Calculation of Loan-to-Value Ratio: LTV = 100 x Loan Amount / Property Value


For a property worth AED 2,000,000, with the UAE’s maximum LTV at 80% for expatriates and 85% for Emiratis, you could borrow up to AED 1,600,000. This means the lender finances 80% of the property’s value, and you cover the remaining 20%.

Higher LTV ratios signify increased risk for lenders, often leading to more stringent loan conditions. The LTV can vary based on both the lender’s and borrower’s financial profiles and remains unaffected by the borrower’s employment status (salaried or self-employed).

Maximum LTV in the UAE:

80% for expatriates and 85% for Emiratis on completed properties.

Up to 50% for off-plan properties, depending on construction progress and developer reputation.

Emiratis Expats Off-plan Properties
Maximum Loan-to-Value Ratio 85% 80% 50%

Top Tip:

When purchasing property in the UAE, remember to account for several additional fees, such as:


  • 4% for Dubai Land Department fees.
  • 2% for real estate agent fees.
  • Fees for property valuation.
  • Property insurance costs.

These expenses can accumulate to a substantial amount. Nonetheless, certain lenders provide the option to incorporate these fees into your mortgage. This allows you to distribute these costs over the duration of the loan. Incorporating these additional expenses into your mortgage can enable you to afford more expensive properties initially and manage the financial burden more effectively over an extended period.

2. What Is a Good Ratio Between Salary and Monthly Mortgage Payment?

Ideal Salary to Mortgage Payment Ratio:

The optimal ratio between your salary and total monthly liabilities, including your mortgage, should ideally not exceed 50%. This encompasses:

  • Current mortgages.
  • Credit card obligations.
  • Personal and car loans.

Staying within this threshold ensures manageable mortgage payments while allowing room for other essential expenditures. This balance is crucial to prevent financial overburden. Adhering to this 50% limit, a regulation from the Central Bank of the UAE, ensures financial stability and helps you comfortably meet mortgage commitments along with other necessary expenses. However, the most suitable ratio may vary depending on individual circumstances.

Maximum Loan Term in the UAE:

The ‘loan term’ refers to the time allotted for repaying the loan. In the UAE, the maximum loan term spans up to 25 years, or until the borrower reaches 65 years of age (for salaried employees) or 70 years (for self-employed individuals). In cases where employers do not have a fixed retirement age, some banks might extend the term up to age 70 for salaried employees. While longer loan terms can lower monthly payments, they also result in higher total interest payments over the loan’s lifetime. It’s crucial to consider your financial situation and long-term plans when selecting the most suitable loan term.


Correlation Between Property Valuation and Loan Amount:

The property valuation, determined by a professional valuer, may differ from the purchase price. Typically, in stable markets, the valuation aligns closely with the property’s value. Lenders base the loan amount on the lower of the two: the purchase price or the property valuation.


Understanding the Mortgage Stress Test:

A mortgage stress test is a financial assessment conducted by lenders to ensure borrowers can handle their mortgage payments under challenging circumstances. The test considers:

  • Income.
  • Expenses.
  • Debts.

For a mortgage to be feasible, the payment at the stressed rate should ideally not exceed 50% of your monthly income. If it does, consider reducing credit limits or clearing existing liabilities like car or personal loans. The stress test aims to ensure you can comfortably afford your mortgage under various scenarios, a part of responsible lending practices for financial stability and peace of mind.



Is It Easy to Get a Loan in Dubai?

Obtaining a mortgage in Dubai depends on individual circumstances. Factors that can ease the process include being a salaried employee, long-term employment with a large international company, and maintaining a good credit history. However, challenges may arise for those employed by smaller companies or with a poor credit score. Seeking the assistance of a mortgage advisor can help navigate these challenges.


Requirements for Obtaining a Mortgage in the UAE:

To qualify for a mortgage in the UAE, you should meet these criteria:

  • Income: A minimum monthly salary of AED 10,000.
  • Age: At least 21 years old.
  • Nationality: No specific nationality requirement, with both expats and non-residents eligible for mortgages in Dubai.


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