What are the legal rules around mortgageable property and transferring loans in Dubai?

In Dubai, properties can be mortgaged and loans can be transferred, but there are specific legal and procedural requirements governed by the Dubai Land Department (DLD) and Real Estate Regulatory Agency (RERA). These ensure transparency and protect both buyers and lenders.

Mortgageable Property Requirements:

• The property must be in a freehold area and registered with the DLD.

• It must be approved by the bank or lending institution—not all properties or developments are eligible for financing.

• For off-plan properties, only certain developers and projects are approved for mortgage by banks.

• A minimum down payment is required:

  • 20% for UAE residents

  • 25% for non-residents

  • Additional requirements may apply for higher-value or second properties.

Rules for Transferring a Mortgage (Loan Takeover):

• A mortgage can be transferred from one buyer to another, often referred to as a loan takeover.

• The new buyer must qualify for the loan under the bank’s current lending criteria.

• The bank must approve the transfer, and a new mortgage registration is completed with the DLD.

• Any existing loan must be cleared or transferred at the time of property transfer, and a No Objection Certificate (NOC) from the bank is required.

Fees Involved:

• Mortgage registration fee: 0.25% of the loan amount + AED 290 admin fee (paid to the DLD)

• Early settlement or transfer fees may apply, depending on the bank’s terms.

Important:
All mortgage-related transactions must be registered with the Dubai Land Department, and buyers are advised to work with licensed mortgage brokers or legal consultants to ensure compliance with current regulations.