The rules that actually govern Dubai mortgages — Central Bank LTV caps, EIBOR mechanics, DSR maths, and a framework for picking the right bank.
Forget glossy rate charts. Four numbers control your Dubai mortgage:
The Central Bank caps mortgage LTV. Banks cannot exceed these:
| Buyer | First home, value ≤ AED 5M | First home, > AED 5M | Second home |
|---|---|---|---|
| UAE national | 85% | 75% | 65% |
| Resident expat | 80% | 70% | 60% |
| Non-resident | 50–60% | 50% | 50% |
| Off-plan (any) | 50% | 50% | 50% |
If a broker tells you 'we can get you 90% LTV', they're either wrong or doing something illegal. The cap is real.
The Central Bank caps total monthly debt service at 50% of gross monthly income. 'Total' means: mortgage payment + car loan + credit card minimums + personal loans. If your salary is AED 30,000 and you have a AED 4,000 car loan, the maximum mortgage payment the bank can underwrite is AED 11,000 — not AED 15,000.
This is the second-most-common surprise buyers hit. Run the maths before you fall in love with a property.
EIBOR (Emirates Interbank Offered Rate) is the UAE's benchmark interest rate, published daily by the UAE Central Bank. Variable mortgages price as 'EIBOR + margin' — e.g. 1-month EIBOR + 1.25%. When EIBOR moves up, so does your variable rate.
The UAE Central Bank tracks the US Fed closely on rate decisions. If the Fed cuts, EIBOR cuts. If the Fed hikes, EIBOR hikes. As of mid-2026, 1M EIBOR is around 4.0%, so a typical variable rate is around 5.25%.
Fixed: 1, 3, or 5-year fixed periods are standard. Beyond that, the loan reverts to variable.
Variable: lower starting rate but rate adjusts (typically monthly or quarterly).
For most buyers in 2026, 3- or 5-year fixed is the default. Pricing certainty during the highest-cost early years of the loan, with the option to refinance once the fixed period ends.
Get pre-approved at 2–3 banks. It's free, no credit-score impact in the UAE the way there is in the US/UK, and you'll see real offers rather than headline rates.
Compare like-for-like products. A 5-year fixed at 4.49% vs a 1-year fixed at 3.99% are not comparable — the 1-year fixed reverts to variable in 12 months and you'll pay much more for years 2–25.
Look at the early settlement penalty. Most banks charge 1% of the outstanding balance (capped at AED 10,000) if you settle early. This matters if you're planning to sell within 5 years.
Salary transfer is a bargaining chip. If you transfer your salary to the lending bank, you typically save 25–50 bps on the rate. Don't underestimate this.
Negotiate the bank arrangement fee. Listed at 1% of loan, capped AED 10,000. Banks regularly waive this if you push.
Choosing the lowest headline rate without checking the reversion rate. That 3.99% 1-year fixed reverts to EIBOR + 2% — much worse than a steady 5-year at 4.49%.
Forgetting the LTV cap on off-plan. If you're buying off-plan AED 2M, you can mortgage AED 1M maximum. The other AED 1M must come from cash + the developer's payment plan.
Underestimating one-off transaction costs. Mortgage adds about 1.5–2% to the upfront cost vs cash purchase. Budget for it.
Not checking the early settlement penalty before signing. If you sell or refinance within 3 years, that 1% can sting.
The Dubai mortgage market is mature, regulated, and competitive — there are no exotic products and the LTV/DSR rules are non-negotiable. The leverage you have is in shopping pre-approvals across 2–3 banks, picking the right rate type for your hold period, and using salary transfer as a discount lever. Get those three right and you'll save AED 50,000+ over the life of the loan.