What Happens To Your Mortgage If You Leave Dubai

  • 08JUL
    What Happens To Your Mortgage If You Leave Dubai

Real estate agents and mortgage brokers in Dubai find this is a recurring question given the transient nature of life in the UAE for expats. We never know what life will throw at us of course, so it's understandable to think about what could happen further down the line if you ever need to leave the country. With this in mind let's take a closer look at the scenarios that could unfold around your mortgage.

Exit Strategy

A highly reputable mortgage broker, like Mortgage Finder for example, will advise clients to plan carefully for the future. Having an exit plan for your property and your mortgage should be part of that planning, even if you feel your job and lifestyle are relatively secure. They will enquire as to how long you intend to stay and what you would prefer to do with your property when you leave. The reason for this is simple - to come up with the best available product for your requirements and ensure you can meet its terms comfortably.

Important Reminder

If at all possible, a move out of Dubai should be planned in plenty of time so that any necessary arrangements with regard to your mortgage can be completed and the process is as stress free as possible. The mortgage process will differ from bank to bank, so it's a good idea to have some knowledge as to the procedure and requirements that your bank has when it comes to leaving the country, even if this is not something you plan to do in the near future.

So What Might Happen?

There are a few different possibilities, and in the worst-case scenario the bank may request that you settle the mortgage before leaving the country. This could be by selling the property, paying it off using your own funds or through a buyout with another bank. In most cases, however, the banks are more concerned with you keeping up the mortgage repayments, irrelevant of where you are located.

Non Resident Mortgage

There are banks in the UAE who, given enough notice, will be more than happy to covert the mortgage you have to a non-resident mortgage. The only downside to this is that you could be presented with a slightly higher rate of interest depending on the loan provider.

Settling The Mortgage Early

Depending on the terms offered by your bank, in paying your mortgage off early you may be presented with an early exit charge. This could be anything up to 3% of the outstanding value of the mortgage. Again, it's important to remain fully aware of the terms you are signing up to when taking the mortgage so that you can try to avoid any pitfalls later on.

The Bottom Line

The bottom line is if you would prefer to keep the mortgage after you relocate, the majority of banks will just need to be assured that you can still meet the monthly repayments and will not fall into arrears. It may even be as simple as letting them know how you will repay the loan, for example through rental income. Again, a good mortgage broker will be able to offer the best advice and help so you fully understand the terms of any product before putting pen to paper.
If, for whatever reason, you do suddenly need to leave Dubai, it is best to thoroughly check through the mortgage offer letter and terms before contacting your bank. This is so that you are fully aware of their requirements because in some cases they may not even need to take any action at all.
For more information on this topic or to speak with an experienced mortgage broker about your property purchase, please contact Mortgage Finder.

Ian Vaughan

Mortgage Finder
8th July 2019