UAE Central Bank finalises mortgage cap
Cap to control rising property prices and restrict home loans
RELATED ARTICLES: Q3 boom in Abu Dhabi, Dubai could sustain momentum in 2014 | Cap Concerns | Experts endorse mortgage cap proposal The UAE Central Bank has issued regulations restricting the amount of cash homebuyers can borrow following the publication of the new rulings in the Bank’s Official Gazette. The much-awaited mortgage caps, will be applied as a measure to control rising property prices, restrict home loans to expatriates at 75% and UAE nationals at 80% of a property’s value for a first investment of less than $1.36 million. For homes worth more than $1.36 million, borrowing by first-time expat buyers will be restricted at 65% of the property’s value and at 70% for UAE nationals in the same case. Borrowings for off-plan property will be restricted at 50% of the property value, irrespective of purpose, value or nationality. The maximum loan length is limited to 25 years, and the maximum age at the time of repayment is set as 65 for expatriates and 70 for UAE nationals. “The Central Bank is seeking to ensure that banks and other financial institutions have and maintain effective business standards and control frameworks in place for the granting of mortgage loans,” said Sultan Bin Nasser Al Suwaidi, bank governor, in a statement.
