Real Estate in Dubai: Loan or Mortgage?

When buying property in Dubai, potential buyers often face a choice: to use a traditional home purchase loan or to take out a mortgage. Despite the similarity of these options, there are important differences between them.

What are the differences?

Although the terms "home purchase loan" and "mortgage" are often used interchangeably, a home purchase loan is a type of mortgage designed exclusively for the purchase of residential property. In Dubai, the term "loan" is more familiar to locals, while European expatriates more often use the word "mortgage".

Advantages and disadvantages.

A home purchase loan usually offers lower interest rates, but requires a significant down payment and strict adherence to terms.

A mortgage provides more flexibility: it is available to expats and allows the use of different types of property as collateral. However, interest rates may be higher, and the approval process is often complex and takes more time.

Mortgage requirements in Dubai:

• age from 21 years;
• valid resident visa (for residents);
• confirmed income and employment;
• good credit history;
• required documents, such as passport copies and bank statements.

How to make a choice?

When choosing between a loan and a mortgage, it's important to consider not only your current financial capabilities, but also long-term goals. Pay attention to interest rates, repayment terms, penalties for early repayment and additional fees.

Buying a property is not only a major investment but also an important step towards financial stability. Regardless of which financing option you choose, the main thing is to be confident in your decision.

If you are considering purchasing a property in Dubai, Kalinka specialists will help you choose a property, arrange a mortgage and accompany you at all stages of the transaction.