10 Tips on How to Get the Best Mortgage Rate in the UAE

Buying a home is one of the biggest financial decisions you’ll ever make. For most people in the UAE, securing a mortgage is the key step to turning that dream into reality. But with banks offering different packages, rates, and conditions, one question stands out: how to get the best mortgage rate?

The truth is, your mortgage rate can make a huge difference in how affordable your property becomes, both in the short term (monthly installments) and the long term (total cost of borrowing). Understanding what influences mortgage rates and how you can position yourself for the best deal is crucial for every homebuyer in Dubai, Abu Dhabi, and across the UAE.

In this guide, we’ll break down the factors that affect mortgage rates, strategies to secure the lowest possible rate, and practical steps to get the best financing option for your situation.

Why Your Mortgage Rate Matters

Before we dive into strategies, let’s understand why mortgage rates matter so much.

• •Monthly affordability: Even a 0.5% difference in your rate can significantly impact your monthly payment.
  
  
  
• •Total loan cost: Over 20–25 years, a higher rate can cost you hundreds of thousands of dirhams more.
  
  
  
• •Eligibility for property: A lower rate improves affordability, meaning you may qualify for a bigger loan and a property that fits your lifestyle better.
  
  
  

That’s why learning how to get the best mortgage rate is not just a financial hack – it’s a way to maximize your long-term investment.

Factors That Affect Mortgage Rates in the UAE

When banks decide what rate to offer you, they look at several factors:

1. EIBOR (Emirates Interbank Offered Rate)
   
   Most UAE mortgages are linked to EIBOR, which fluctuates based on market conditions. If EIBOR rises, your mortgage rate may go up unless you’re on a fixed rate.
   
2. Your Credit Profile
   
   A higher credit score signals lower risk, meaning banks may offer you more competitive rates.
   
3. Salary and Income Stability
   
   The higher and more stable your income, the better your chances of securing a lower rate.
   
4. Loan-to-Value Ratio (LTV)
   
   If you pay a bigger down payment (e.g., 30% instead of the minimum 20%), the bank may reward you with a lower interest rate.
   
5. Fixed vs. Variable Rates
   
   Fixed rates provide stability for a set number of years, while variable rates can fluctuate but may start lower.
   

10 Practical Tips on How to Get the Best Mortgage Rate

Here are actionable steps every UAE homebuyer can take:

1. Strengthen Your Credit Score

Request your AECB (Al Etihad Credit Bureau) report and check for issues. Paying off debts, settling credit cards, and avoiding late payments can all improve your score.

2. Save for a Larger Down Payment

The minimum down payment in the UAE is 20% for expats and 15% for UAE nationals. But if you can put down more, you reduce the bank’s risk – often leading to better rates.

3. Compare Fixed and Variable Options

Ask yourself: do you prefer stability or flexibility? Fixed rates are ideal if you want predictable payments, while variable rates may save you money if market rates decline.

4. Shop Around Different Banks

Each bank has its own lending policies. Don’t just accept the first offer – compare packages from at least three to four lenders.

5. Work with a Mortgage Broker

A mortgage broker can access offers that may not be publicly advertised and can negotiate better terms on your behalf. This is one of the most effective ways to secure the best rate.

6. Keep Employment Stable

Banks prefer borrowers who have been in their current role for at least six months to a year. If possible, avoid switching jobs just before applying for a mortgage.

7. Consider Refinancing Later

Even if you don’t get the lowest rate now, refinancing your mortgage in a few years could help you reduce costs if rates fall.

8. Negotiate Fees Alongside Rates

Sometimes a slightly higher rate with lower processing fees may be cheaper overall. Always look at the total cost, not just the headline rate.

9. Lock in Rates Quickly

If you find a good fixed rate, consider locking it in before market changes push rates higher.

10. Stay Updated on UAE Market Trends

Keep an eye on EIBOR movements, inflation, and Central Bank announcements. Being proactive helps you time your mortgage application for the best deal.

Common Mistakes to Avoid When Searching for the Best Rate

• •Focusing only on interest rates: Fees, insurance, and hidden costs also matter.
  
  
  
• •Ignoring prepayment penalties: These can reduce your flexibility to repay early or refinance.
  
  
  
• •Not getting pre-approval: Without pre-approval, you may waste time looking at properties outside your affordability range.
  
  
  

Should You Refinance If Rates Drop?

Many homeowners ask whether refinancing makes sense if rates go down. The answer: yes, if the savings outweigh the switching costs. In the UAE, refinancing has become increasingly popular, especially when EIBOR trends shift.

By regularly reviewing your mortgage, you can ensure you’re always getting the best deal possible.

Figuring out how to get the best mortgage rate in the UAE is a mix of preparation, research, and smart decision-making. Strengthen your financial profile, explore multiple bank offers, and don’t hesitate to seek professional advice.

At Mortgage Finder, we specialize in helping expats and UAE nationals secure the most competitive mortgage deals. Whether you’re buying your first home, upgrading, or refinancing, we’ll guide you every step of the way.