How Much Deposit Is Required for a Mortgage: UAE Rules Explained

If you’re planning to buy a home in the UAE, one of the first questions you’ll likely ask is “how much deposit is required for a mortgage?” Understanding this is crucial because your deposit size will determine the type of property you can afford and how much you need to save before applying.

In the UAE, mortgage deposits are regulated by the Central Bank, and the requirements vary depending on your residency status, the property’s value, and whether it’s your first or second home. In this article, we’ll break down the deposit rules, offer tips for saving faster, and help you plan your purchase confidently.

What Is a Mortgage Deposit?

A mortgage deposit is the upfront payment you make towards your property’s purchase price. In the UAE, banks require a certain percentage of the property’s value to be paid in cash before approving a home loan. This acts as your equity in the property and reduces the lender’s risk.

For example, if you’re buying a property worth AED 1 million and the bank requires a 20% deposit, you’ll need to pay AED 200,000 upfront, with the remaining AED 800,000 covered by your mortgage.

UAE Mortgage Deposit Rules for Expats and UAE Nationals

The Central Bank of the UAE has set clear guidelines on how much deposit is required for a mortgage based on residency status:

Notes:

• -If the property is your second home or an investment property, the deposit requirement may be higher.

• -Some banks offer special packages with slightly lower deposit requirements for certain buyer profiles, but these are exceptions.

Why Do Deposits Differ for Expats and Nationals?

The difference is primarily due to risk assessment. UAE Nationals typically have stronger financial ties to the country, making lending to them less risky from a bank’s perspective. Expats, on the other hand, may relocate or
leave the country, so banks require a slightly higher deposit.

Other Costs to Consider Alongside the Deposit

When calculating how much deposit is required for a mortgage, don’t forget the additional property purchase costs in the UAE:

• -Dubai Land Department (DLD) fee: 4% of the property price

• -Registration fee: AED 4,000 for properties over AED 500,000 (AED 2,000 for those under)

• -Mortgage registration fee: 0.25% of the loan amount + AED 290 admin fee

• – Bank arrangement fee: Usually around 1% of the loan amount

• – Valuation fee: AED 2,500 – AED 3,500 on average

These fees are separate from your deposit and need to be paid upfront.

Tips to Save for Your Mortgage Deposit Faster

Saving a deposit can feel challenging, but with the right strategy, it’s achievable:

1. Set a savings goal based on the property price you’re targeting.

2. Open a dedicated savings account to keep your deposit separate from everyday expenses.

3. Automate monthly savings transfers so you stay consistent.

4. Cut back on non-essential expenses and redirect that money to your deposit fund.

5. Consider partial equity release from an existing property if you already own one.

If you’ve been wondering how much deposit is required for a mortgage in the UAE, the answer depends on whether you’re a UAE National or an expat, as well as the value of the property you’re buying. For most expats, expect to pay at least 20% for properties under AED 5 million and 35% for more expensive properties.

By Brendan Kennelly, Senior Mortgage Advisor at mortgagefinder.ae