Numerous individuals consider Dubai first when opting for where to buy their perfect property. This is because an investment in Dubai is exempt from any annual property tax, income tax, capital gains tax, rental revenue tax, or Value Added Tax (VAT). This enables an investor to devote a vastly less fiscal portfolio to property accession, performing in advanced returns.

But real estate acquisition is a grueling procedure in the UAE. Buying a property for the first time can be intimidating, stressful, and frustrating because of all of these unknown aspects. You must make various selections, including where to reside, whether to hire a real estate agent and which mortgage to use to finance your purchase. The most significant variables to consider when selecting a mortgage broker in the UAE are upfront expenses, mortgage duration, and interest rate type.

So, if you intend to purchase a property with a mortgage, you can consider working with a Dubai real estate mortgage broker. The following article addresses some of the most frequently asked questions concerning mortgage brokers in the UAE and the benefits and drawbacks of hiring one.

Who Is A Mortgage Broker? 

A mortgage broker serves as a liaison between parties offering loans for real estate purchases and people looking to make such purchases. Mortgage brokers help potential borrowers locate lenders with the best terms and prices for their circumstances.

Pros Of Hiring A Mortgage Broker 

Listed below are some benefits of hiring a mortgage broker in Dubai: 

1. Saves Time And Energy 

A mortgage broker can spare buyers time and stress by locating and assessing loans and managing the mortgage procedure. Brokers manage documentation, interact with key players, and maintain the timeline for underwriting, all of which may help you close your loan more quickly. 

2. Access To Multiple Lenders 

You might have access to a variety of lenders, lending options, and interest rates through a broker. A mortgage broker may even negotiate special rates that are less expensive than those you could get from a lender.

A broker can help you manage mortgage fees and save you hundreds or even thousands of dirhams by persuading the lender to cut or waive them.

3. Assist In Decision-Making 

A mortgage broker can provide information on how much house you can afford and the likelihood that your loan will be approved.

4. Expertise 

Because of their expertise in the mortgage industry, brokers can shield you from making the wrong decisions. 

Cons Of Hiring A Mortgage Broker 

The following are a few drawbacks of using a mortgage broker:

1. Broker Fees 

The borrower can be required to pay the broker a charge of 1% to 2% of the loan amount, which is the first disadvantage. It could differ from one broker to the next. 

2. Might Not Always Be Worth The Money

Brokers trying to close as many loans as rapidly as possible may not always offer excellent service in the cutthroat mortgage industry. 

3. Lack Of Research And Awareness

A borrower who doesn’t do their research on mortgage brokers may find working with one who is clumsy and makes the process of buying a property tiresome and onerous. Depending on where you reside, it could be challenging to find a reliable local broker.

4. Limited Control Over Your Loan Profile

Your loan file is not internally underwritten by the mortgage broker, as it would be with a mortgage banker; therefore they may have less control over it.

Conclusion 

So, we hope we have helped you by providing information about the mortgage broker in UAE. Working with one may help a borrower save a lot of money throughout the loan as well as time and effort during the application process.

Brokers can convince lenders to waive additional charges including application, appraisal, and origination costs. It’s crucial to take into account all expenses, including those you could owe the broker or lender as well as any the broker might be able to prevent you from paying. You can determine if you need a mortgage broker by assessing their advantages and disadvantages. 

Frequently Asked Questions 

The answers to the most frequently asked questions about mortgage investments are addressed below: 

1. Why do lenders need security checks when applying for a mortgage?

Banks in the United Arab Emirates demand security cheques because they are used when a borrower is unable to make mortgage payments. If this occurs, the bank will deposit the cheque, and if it bounces, it will be allowed to file a lawsuit to seize the property to repay the debt.

2. Can my housing allowance be factored into my mortgage payment?

When you apply for a mortgage, your employer’s housing allowance may be taken into consideration.

For instance, if your contract or salary certificate states that you will receive a housing allowance if you leave the company-provided housing, the allowance you will receive can be applied toward your mortgage. This is true even if you currently reside in company-provided housing. Although you must still have the needed down payment, the allowance may help you be more affordable and, as a result, may, in some circumstances, increase the amount you are eligible to borrow.

3. How much will the fees be for obtaining a mortgage in Dubai?

A bank valuation fee and a bank arrangement fee are expenses specifically related to a mortgage. Depending on the bank, the bank valuation cost can be between AED 2000 and 5000 and the bank arrangement fee can be between 0% and 1.5%.

Also, In Dubai, there is additionally a mortgage registration charge of 0.25% + AED 290 that must be paid to the Dubai Land Department.