Today, in many aspects Dubai has proven itself as the world’s most escalating and flourishing city. It is because of gaining high scores on luxury, tourism, international trade, and whatnot. Talking of the real estate market in Dubai which is undoubtedly highly able and lucrative. However, there comes various mastermind real estate companies that gave rise to the renowned and top-notch luxury properties in Dubai. With all the property choices that investors have they can find their dream home in the best possible deals. In this regards most buyers don’t prefer buying a home with cash because of the affordability. For such, there is an option of mortgage which appears as a contract when the bank grants a certain amount to the borrower. To provide you assistance in making the right decision DxB Lux Homes shares must read a guide about mortgage-based property in Dubai.
What is a mortgage payment?
A mortgage is defined as the loan that finances the property purchase which includes Dubai luxury apartments, commercial buildings, and lands. Instead of making the full payment at the time of buying, you can pay a chunk of the amount with the mortgage facility. However, the rest of the payment would be taken care of by the provider of the mortgage. Generally, various mortgage plans have up to 25 years period but it depends on the lender of the mortgage and the report of your credit. Despite the tenure of the loan the mortgage lender possesses the property ownership until all the payments are cleared accordingly to the repayment plan. Simply, the worth of your home is utilised as security till you pay the loan amount.
Types of mortgages
It is not a denying fact that Dubai is a perfect destination for those who desire a modern yet lavish lifestyle. Acknowledging this need the market mortgage has now progressed because both international, as well as national lenders, are providing mortgages for ex-pats and residents of Dubai. Financial mortgagee provides different kinds of mortgages to fully satisfy your needs. The buyers of luxury homes in Dubai have the choice between two types of mortgages either fixed rate or variable rate.
In fixed rate mortgage has the same rate of interest for a defined time. In addition, the rate of interest is made at the preference of the mortgage provider. On the other hand, in variable rate mortgage has a floating rate which means that the rate of interest varies over the period.
Conventional vs Islamic mortgage
In a conventional mortgage, the buyer of the luxury property in Dubai has to repay the mortgage payment with the interest percentage. In turn, this interest rate will become the source of profit to let the purchaser borrow the amount. Whereas the Islamic mortgage is concerned it is not the same as the conventional one. In this scenario, the Law of Shariah will be taken into account according to which interest on a mortgage is forbidden. Instead, the lender will purchase the home on your behalf and lease or rent it afterward.
Who can buy a mortgage in Dubai
It is essential to know about the eligibility criteria of the mortgage so you can prepare your mind before getting a Dubai property mortgage. The nationals as well as the ex-pats can apply for the mortgage-based property as there is no legal hindrance to nationality. However, keep in view that that salary amount may vary for ex-pats and nationals depending upon your selection of bank.
After considering all of the above it is quite clear that the mortgage has become quite popular since banks strive to give exemption on home loans. Although in some cases obtaining a mortgage becomes difficult for those buyers who are not ready for it. Therefore, you need to keep in view certain things to avoid mistakes and make the process convenient.