Property ownership is a lifelong investment that yields numerous benefits. Alongside real estate appreciation, it shields individuals from annual rental expenses and other recurring costs. However, owning a property in the UAE is not inexpensive, especially considering the substantial upfront price tags. This is when property buyers and investors turn to various financing and mortgage models.
Home financing becomes a practical option by breaking down the total property cost into more manageable instalments. Those looking for Islamic home finance in the UAE will come across a range of choices. Comparing costs, requirements and features of the available options is essential to make an informed decision. Here’s a round-up of the popular Islamic mortgage banks in the UAE.
Islamic Mortgage Banks in the UAE: Explore the Available Options
Several banks offer Islamic mortgages in the UAE. Here’s a roundup of a few popular ones and their home financing packages.
Abu Dhabi Islamic Bank (ADIB)
Abu Dhabi Islamic Bank (ADIB) is a prominent Islamic financial institution based in the capital. It is known for its range of Sharia-compliant services aligned with the home financing law in the UAE.
The ADIB’s offer for an Islamic mortgage in the UAE targeting expats has been detailed below.
ADIB Home Finance for Expats
Advantages:
- Enjoy complimentary property insurance
- Access reduced profit rates with Salary Transfer
Essential Details:
- Maximum Funding: AED 15,000,000
- Maximum Repayment Term: 25 Years
- Financing is available for any ready property in Dubai, Abu Dhabi & Sharjah with a title deed.
Common Requirements:
- Current and valid passport, visa, and Emirates ID copies
- Copies of offer letters
- Documentation of rental income
- Liability letter
- Relevant property documents
- Address proof (copy of electricity bill)
Required Documents for Salaried Individuals:
- Most recent salary certificate
- Latest 6 months of personal bank statements
- Six months of pay slips (if there is a variance in salary)
Required Documents for Self-Employed Individuals:
- Valid company trade license
- Memorandum of Association (MOA) with all amendments
- Six months of personal bank statement
- 12 months of company bank statement
- Audit financials for the last 2 years
- Proof of all ongoing company finances
Financial Criteria:
- Minimum Monthly Salary: AED 15,000
- Employment Duration: 6 months (salaried), 3 years (self-employed)
- Salary Transfer: Voluntary
Minimum Initial Payment:
- First property (< AED 5M): 20%
- First property (> AED 5M): 30%
- Second property: 40%
RAKBANK
RAKBANK offers Islamic mortgage loans in the UAE. These financial services provide a flexible and cost-effective solution for home financing in Dubai, Abu Dhabi and Ras Al Khaimah. RAKBank has a team of specialised mortgage advisors.
The bank offers the following package to Islamic mortgage applicants.
RAKBANK Islamic Home Finance
Advantage:
- Fixed-rate options available
- Free partial settlement up to 25%
Financial Criteria:
- Minimum Salary: AED 15,000
- Minimum Length of Service: 6 months
- Salary Transfer: Not compulsory
Minimum Down Payment:
- First property (< AED 5M): 20% for UAE nationals, 20% for expats
- First property (> AED 5M): 30% for UAE nationals, 35% for expats
- Second property: 35% for UAE nationals, 40% for expats
Key Details:
- Maximum Term: 25 years
- Finance is available for almost all ready properties in Dubai, Abu Dhabi & Ras Al Khaimah
To understand more about off-plan vs ready property, read here.
Common Requirements:
- Valid Passport, Resident Visa, and Emirates ID
- Documented proof of rental income (if applicable)
- Property documents (If the property is finalised or equity release)
- Liability Letter (In case of buyout finance only)
- Address Proof
Required Documents for Salaried Individuals:
- Latest Salary Certificate addressed to RAK BANK
- Six months of bank statement
- Six months’ payslips if there is a variance in salary
Required Documents for Self-Employed Individuals:
- Valid Trade Licence
- MOA (Memorandum of Association) including all amendments
- Six months of personal bank statement
- Six months of company bank statement
- Audit financials of the last two years
- Proof of the company’s ongoing finances
Central Bank of Dubai
The Central Bank of Dubai (CBD) is one of the popular Islamic mortgage banks in the UAE. The financial institute offers innovative financing solutions tailored to meet diverse needs. CBD’s Ijarah home financing rates are also very convenient.
The financing rate is among many key things to be aware of when financing your first UAE home. Let’s take a look at CBD’s Islamic mortgage package features and requirements.
CBD Ijarah Home Lease for Expats
Advantage:
Low minimum salary requirement
Available for both off-plan and ready property
Finance Criteria:
- For salaried individuals: AED 12,000
- For self-employed individuals: AED 20,000
- Minimum Length of Service: 6 months for salaried; 3 years for self-employed
Minimum Down Payment:
- First property (< AED 5M): 20%
- First property (> AED 5M): 35%
- Second property: 40%
Essential Details:
- Maximum Finance Amount: AED 20,000,000
- Maximum Term: 25 Years
Common Documents:
- Valid passport, resident visa and Emirates ID copy
- Rental income document (if any)
- Liability letter (in case of buyout finance only)
- Relevant property documents
Required Documents for Salaried Individuals:
- Latest salary certificate addressed to CBD Bank
- Six months of personal bank statement
- Six months of pay slips if there is a variance in salary
- Salary transfer letter
Required Documents for Self-Employed Individuals:
- Valid company trade licence
- MOA (Memorandum of Association) including all amendments
- Six-month personal bank statement
- Six-month company bank statement
- Audit financials of the last two years
- Proof of the company’s ongoing finances
Read our guide to acquiring a home loan in the UAE to understand more about the aforementioned document requirements.
National Bank of Fujairah
It is another financial institution offering services of UAE home finance for expats and locals. The National Bank of Fujairah (NBF) has a dedicated package for Islamic mortgages. Details of the Islamic home financing solution have been shared as follows:
National Bank of Fujairah Islamic Mortgage
Major Advantage:
- High finance amount
- Fixed-rate options available
- Quick processing time
- No hidden charges
Finance Criteria:
- For salaried individuals: AED 15,000
- Expat self-employed individuals: AED 30,000
- Emirati self-employed individuals: AED 25,000
Minimum Down Payment:
- First property (< AED 5M): 20% for UAE nationals, 20% for expats
- First property (> AED 5M): 30% for UAE nationals, 35% for expats
- Second property: 35% for UAE nationals, 40% for expats
Essential Details:
- Maximum Finance Amount: AED 20,000,000
- Maximum Term: 25 Years
Common Requirements:
- Valid passport, resident visa and Emirates ID copy
- Rental income document (if any)
- Liability letter (in case of buyout finance only)
- Relevant property documents
Required Documents for Salaried Individuals:
- Latest salary certificate addressed to CBD Bank
- Six months of personal bank statement
- Six months of pay slips if there is a variance in salary
- Salary transfer letter
Required Documents for Self-Employed Individuals:
- Valid company trade license
- MOA (Memorandum of Association) including all amendments
- Six-month personal bank statement
- Six-month company bank statement
- Audit financials of the last two years
- Proof of the company’s ongoing finances
Learn about some important features of short-term vs long-term mortgages in Dubai. Weighing the available options from different aspects is essential to make the right choice.
Other Banks Offering Islamic Home Financing in the UAE
Here’s a list of some more financial institutions offering Islamic mortgage solutions in the UAE.
- Emirates Islamic Bank
- Noor Bank
- Sharjah Islamic Bank
- Ajman Bank
- Al Hilal Bank
- Abu Dhabi Commercial Bank (ADCB)
- Mashreq Bank
- Commercial Bank of Dubai (CBD)
- Al Rayan Bank
- Al Masraf
- Dukhan Bank
Whether someone is looking to apply for a conventional or an Islamic mortgage, the aforementioned banks offer a range of home financing solutions in the UAE.
FAQs
How many types of Islamic mortgages are in the UAE?
There are three types of Islamic mortgages in the UAE: Ijara, Musharaka, and Murabaha. All these are internationally recognised Shariah-compliant financing models.
Can I get an Islamic Mortgage in Dubai?
Yes, you can apply for Islamic home finance in Dubai or any other emirate in the country. All you need to do is to get in touch with your desired Islamic bank. Their representative will guide you with the necessary procedures.
Can non-resident investors apply for mortgage loans in Dubai?
Yes, mortgage loans for non-resident investors in Dubai are allowed by the law. However, it is important to be aware of the requirements and limitations to make an informed decision.
There you have it – a roundup of some popular Islamic mortgage banks in the UAE. The Dubai Land Department (DLD) governs and approves all property mortgage-related matters in the emirate. This is why for any modifications to the mortgage loan, it’s mandatory to request a mortgage amendment from DLD.
Easier home financing modes mean more accessibility to buying property in the UAE. That said, what if the property you are selling is already mortgaged? Read here to find out how to sell a mortgaged property in Dubai. A similar process is followed in other emirates as well.
For more updates on applying for a Shariah-compliant mortgage in the UAE, keep reading dubizzle property blogs.
