Mortgage FAQ
Home Loans
Why should I choose Mashreq home loan as compared to other banks?
- High loan amounts of up to AED 12 million
- Loan Tenor up to 25 years
- Highly competitive interest rates options
- Loans to resident expatriates and non-residents
- Loans for both the salaried and self employed
- Widest network of approved developers
- Home equity / re-finance options
- Commercial Property Financing
- Dedicated Mortgage Relationship Managers providing doorstep service
- Express & quick approvals
- Mortgage take-over / buyouts from other financial institutions & banks
- Nominal processing fees and charges
- Transparency at all times
Who can apply for a home loan?
Resident expatriates and non-residents.
What is the minimum/maximum age required to apply for a home loan?
For Salaried Customers: Minimum: 21 years Maximum: 65 years on maturity of loan
For Self-employed Customers: Minimum: 21years Maximum: 70 years on maturity of loan
What is the maximum loan amount permissible per individual?
You can borrow up to a maximum of AED 12 million.
What is the maximum Loan Tenor?
The loan tenor can go up to a maximum of 25 years.
Who will process my home loan?
Our Mortgage Relationship Officer will visit your home or office at your convenience to complete the formalities. You also have the option of visiting our specialised home loan center.
How long will it take to get my loan approved?
The loan process will take at least seven working days subject to submission of all required documents.
How is my mortgage application evaluated?
Your application will be evaluated on the following criteria:
- Your income stream
- Your employment history and stability
- Your ability to handle current obligations as well as new ones
- The value of the property being purchased or refinanced
- Your assets to assess your ability to meet your down payment
What is “Refinance” and do you offer this product?
Refinance allows you to liquidate the cash value of property, available to resident expatriates living in the UAE only.
Does Mashreq provide loans for commercial properties?
Yes, Mashreq provides loans for commercial properties located in approved projects.
Do you cover re-sale transactions?
Yes, at Mashreq we deal with two types of transactions:
Full Payment: Where the first purchaser has made 100% payments to the developer and is selling the property to you. Here the payments would be made to the first purchaser.
Part Payment: Where the first purchaser has only paid the down payment and the balance is yet to be made to the developer. Here, the down payment would need to be paid by you to the seller and the balance be made to the developer.
What is a pre approval?
A pre-approval would help you determine your eligibility for a mortgage before you decided to finalise a property.
Do you require insurance?
Yes, both Life Insurance and Property Insurance are mandatory before disbursing the loan.
Property Insurance: The Property Insurance premium is calculated on the cost of the property and is available only through Oman Insurance Company (OIC). The amount of the insurance premium will be debited from your account prior to the final disbursal and each year thereafter. A property insurance certificate will be delivered to you by the insurance company within a month.
Life Insurance: Life insurance is also mandatory from OIC. Customers with existing life insurance policies through Oman insurance Company, Zurich and Alico have the option to assign* the policy to the bank provided that it meets the following criteria:
- Policy is more than six months
- Policy covers the loan value
- Policy covers the tenure of the loan including the construction period
- Policy is active and insurance premium is paid up to date
Please Note: An Assignment Fee will be applicable
What are the charges linked to my home loan?
- Processing fee – 1% on the approved loan amount, or maximum AED 20,000
- Pre-approval fee – AED 1,000
- Pre-payment fee of Nil (Zero) to 1% on the outstanding would be charged in case of early settlement from own funds
- Buy-out fee of Nil (Zero) to 3% on the outstanding will be charged if another financial institution settles the loan
- Amendment / Re-validation Fee – AED 500 in case of amendments made after the loan is approved/booked
- Property valuation fee – AED 3,000
*All the fees are subject to the sole discretion of Mashreq & may change from time to time
Who are the approved developers of Mashreq?
- Emaar Properties PJSC
- Nakheel Co.
- Damac Properties LLC
- Ilyas & Mustafa Galadari Management Investment & Development
- Benaa LLC
- Hircon International LLC
- Trident International Holdings FZCO
- IFA Hotels & Resorts
- Star Guga Establishment Limited
- Bin Lahej Real Estate
- Reef Real Estate
- Global Real Estate Development Co.
- Global Realty Partners FZC
- Estithmaar Realty FZ LLC
- Mazyood Giga International FZE
- ETA Star Property Developers LLC
- Jumeirah Properties Investment Ltd
- Al Manal
- K.G. International
- Sheth Estate International (Seil)
- Dubai Select
- Lokhandwala Builders
- Al Salehi
- Holville Property
- Fakhruddin Properties Ltd.
Documents Section
What are the documents needed for a Mortgage Loan?
For Salaried Employees
- Application form
- Passport copy with valid visa (residents only)
- Salary Certificate addressed to Mashreqbank
- Last six months original bank statements
- Liability letter from the bank addressed to Mashreqbank
- Credit Report (non-residents only)
- Know your customer/banker reference (non-residents only)
- Photocopy of Purchase Contract
- Photocopy of Down Payment receipts
For Self-employed Individuals
- Application form
- Passport copy with valid visa
- Last six months bank statements personal and company
- Liability letter from the bank addressed to Mashreqbank
- Memorandum and articles of association
- Audited financial statements of last 2 years
- Board resolution copy
- Trade license copy
- Copy of Chamber of Commerce Registration
- Business profile on company letterhead
- Photocopy of Purchase Contract
- Photocopy of Down Payments
How will you initiate my disbursals?
Disbursals will be made to the developer based on payment schedules mentioned in the purchase contract & the confirmation from the developer on the same. In case of a secondary sale, the payment would be done to the seller after completion of formalities of the borrower.
Do I need to submit all the property documents in original?
Yes, we will be the custodians of original property documents. After the loan settlement in full, a no liability certificate & all relevant documents will be handed over to you.
Do I need to give security cheques?
Yes, this acts as security for the bank in case of non-payment of installments.
Do I need to transfer my salary to Mashreq?
Yes, this makes it convenient to repay your installments.
Can I also issue post-dated cheques?
Yes, this applies under special circumstances and is at the sole discretion of the bank.
How does Mashreqbank communicate the approval?
Our Relationship Officer will inform you about the status of the loan. An offer letter will be provided to you on approval. You need to complete the formalities within 30 days of issuance. The offer letter is valid for a period of 60 days to allow you to complete the fixed formalities.
Do all owners of the property have to be co-borrowers to the loan?
Yes, all co-owners of the property have to be co-borrowers.
Can the income of more than one person be considered for eligibility calculations?
Yes, however all borrowers, whose income will be considered, will have to be co-borrowers to the loan.
Loan Repayments
How can I make my monthly payments as a resident?
You are required to open a current account with Mashreq. Your Equal Monthly Installment will be recovered from your account.
How can I make my monthly installment payments as a non-resident?
You would need to open a non-resident current account at your nearest Mashreq branch. Your Equal Monthly Installment will be recovered from your account.
When will you start my Equal Monthly Instalments (EMI)?
The installments will commence only after the final payment is made to the developer/seller. For example, if the final payment is completed on Dec 2006 then the first installment will begin from Jan 2007.
When do I start paying in case of under-construction property?
During the course of construction you will only re-pay interest on the money disbursed to the developer on your behalf. The actual EMI will only start after the property has been completed, and the final payment has been made to the developer.
How can I calculate my equated monthly installments?
You can use our EMI calculator on our website www.mashreqbank.com Please enter the loan amount, tenor and the rate of interest.
General Section
Can I get a loan if I buy from the secondary market?
Yes, we can fund up to 90% of the evaluated price for selected completed projects only, and up to 80% for selected under-construction projects.
How do I ensure that my property transactions are legitimate?
- Ensure you buy from a reputed developer
- Ensure you buy directly from developer or through a reputed broker
- Ensure that property documents are properly signed & stamped by the developer and owners
- Ensure that down payment receipts are stamped adequately & are in your custody
- Ensure you peruse the loan documents with your financier & submit all documents in order
Can I transfer my current housing loan to Mashreq?
Yes, we offer buy-out facilities.
What is the difference between a fixed rate and a variable rate?
Fixed Rate Mortgage has the same rate for the entire term of the loan.
Variable Rate Mortgage has a rate that can change, causing your monthly payment to increase or decrease depending on fluctuating interest rates.
What is a seller’s comfort letter?
In case of re-sale transitions, Mashreqbank issues a seller’s comfort letter to the seller. This acknowledges the amount to be paid to him subject to the customer/buyer completing the required formalities with us.
What is an MOU? Who makes the MOU? Who are the parties involved in the MOU?
A Memorandum of Understanding is signed between the buyer and the seller confirming the terms and conditions on the re-sale property transition. The MOU is usually prepared by the broker and is signed by the buyer, seller and the witness.
Mortgage - Know How Terms
Home Loan: A home loan requires you to pledge your home as the lender's security for repayment of your loan. The lender agrees to hold the title or deed to your property until you have paid back your loan plus interest.
Amortization: Repayment of a mortgage/home loan by installments with regular payments to cover the principal and interest.
Debt-to-Income-Ratio (DTI): The ratio of aggregate monthly debt to aggregate monthly income.
Down Payment: Money paid by a buyer from his own funds, as opposed to that portion of the purchase price, which is financed.
EMI: Equated monthly installments
Home Equity: Equity is the difference between the home's fair market value and the unpaid balance of the mortgage and any outstanding debt over the home. Equity increases as the mortgage is paid or as the property enjoys appreciation. For example, if your homes' market value is AED 100,000 and you owe AED 60,000 on your mortgage, then you have AED 40,000 equity in your home.
EIBOR: EIBOR is the interest rate charged by banks in the United Arab Emirates for inter-bank transactions. In most cases, EIBOR is the reference rate most commonly used by borrowers and lenders to conduct financial transactions in Dubai and the surrounding Emirates.
LIBOR: The London Inter-bank Offered Rate Index (LIBOR) is an average of the interest rates that major international banks charge each other to borrow U.S. dollars, in the London money market. Like the U.S. treasury and the CD indexes, LIBOR tends to move and adjust quite rapidly to changes in interest rates.
Loan-To-Value Ratio (LTV): The relationship between the amount of the mortgage loan and the appraised value of the property expressed as a percentage. A LTV ratio of 90 means that a borrower is borrowing 90% of the value of the property and paying 10% as a down payment. For purchases, the value of the property is assumed to be the purchase price, and for refinances the value is determined by an appraisal.
Mortgage: A legal document that pledges property to a creditor for the repayment of the loan, and is the term used to describe the loan itself. Some states use the term First Trust Deeds to refer to mortgage loans.
Processing-Fee: The fee imposed by a lender to cover certain processing expenses in connection with making a loan. Usually a percentage of the amount loaned.
Pre-Approval: A term used to mean that a borrower has completed a loan application and provided debt, income and savings information that has been reviewed and pre-approved by an underwriter.
Purchase-Agreement: A written contract signed by the buyer and seller stating the terms and conditions under which a property will be sold.