Comprehensive information about the mortgage, its terms and how to obtain it

 We often hear the term "mortgage", but most of us are ignorant of the economic implications of this term and do not have sufficient awareness of this term, due to the lack of information from those with knowledge or the absence of a comprehensive awareness of the mortgage system.  So, in an effort to spread awareness and education, we decided to provide in this article answers about everything in your mind about the concept of mortgage and the term mortgage financing, which has become widespread recently. We will also present a comprehensive contrast between the concepts of real estate financing and mortgage, which always happen to be confused between them.  We will also present to you a group of the most prominent banks that offer easy and affordable mortgage.

 What is a mortgage?

 The mortgage system is represented by two parties, the financier and the borrower, and the property itself is the main collateral for the loan!

 The mortgage system can be defined as a long-term loan obtained in exchange for a property, and the meaning in return for a property means that if you fulfill the conditions for obtaining a mortgage on the condition that the property is mortgaged, then in the event that you fail to pay the amount of the mortgage loan or part of it, then the mortgagee of the property is entitled to  Disposing of your real estate, whether in selling or renting it, so that he can recover the loan amount that was granted to you.  So, in another way, we can say that the process of obtaining financing with the mortgage of the property is a transaction represented by two parties, one of which provides the necessary money to the second party (here the customer or the borrower) so that the customer can buy his property on the condition that the property is mortgaged for the benefit of the first party, and the process of paying the resulting value  Take out a loan to mortgage the property in long-term installments.  Consequently, the second party enjoys buying his dream home with full ownership of it and in monthly installments commensurate with his income, but in the event that he fails to pay, the first party has the right to dispose of the property.

 The mortgage consists of three parts, which are the monthly installment, the down payment, and the fees, the details of which are as follows:

 Monthly Installment: The monthly amount incurred by the borrower from the value of the mortgage throughout the repayment period, and it is calculated from the principal amount of the mortgage together with the value of interest or profit, and sometimes includes real estate fees and other taxes. First payment: When you get a mortgage, you must pay an initial amount to obtain a mortgage.  It is worth noting here that the higher the down payment amount, the better financing and consequently lower interest rates, and all this results in you acquiring ownership rights to your property faster. Fees: Those wishing to obtain mortgage financing must pay specific fees in advance.

 The mortgage includes two conditions that must be met at the end of the specified period to repay the value of a mortgage loan, which are the principal amount of financing and the interest due on it, and are determined according to the number of years of payment agreed upon and the amount of financing granted.  Types of loans against mortgage are of several types, including fixed-interest loans, variable-interest loans, and the refinancing process, and you can buy completed and off-plan properties.  In the following, we will talk about the types of mortgage loans with real estate mortgage referred to later.

 Types of real estate loan with real estate mortgage

 Fixed interest mortgage

 If you wish to borrow financing with a mortgage on the property with a fixed interest, you will be able to repay the value of the loan in fixed installments over the agreed upon loan repayment period, meaning that the interest rate applied to the amount borrowed will remain unchanged for a period of time determined in advance without regard to changes in interest rates during this period  .  This type of financing with a fixed-interest mortgage on a property is characterized by its low risk and its stability because it is not affected by the interest rates in the market, and the borrower will always be aware of the amount to be repaid monthly, but what most distracts individuals from choosing this type of loan is the possibility of lower interest rates.  Significantly later after obtaining a fixed rate mortgage.

 A variable rate mortgage

 Unlike the previous type, this type of mortgage loan is represented by an interest rate that changes periodically and thus the value of the installment paid for the loan changes according to the change in the interest rate.  With the date of each due date.  This type of interest may pose risks to the borrower, as if the interest rate increases during the loan repayment period, the total value of the borrowed amount will increase, and it is not possible to predict the amount of the borrower's repayment monthly.  However, with low interest rates, the borrower will enjoy paying lower monthly installments and thus can pay a lower amount, but this matter is "likely" to happen and it is not possible to say if it will actually happen.

 Refinancing

 This type of real estate mortgage financing is represented by the possibility of transferring the mortgage financing to another financing plan that suits your capabilities according to certain conditions!  If you are confused about making the decision to refinance, then we will present to you 3 things that will determine whether the "refinancing" process is worth or not:

 Study the interest rate of the current loan and the new loan Study the cost of refinancing payable Check whether you will have to pay other penalties as a result of your choice of refinancing

 Mortgage Advantages

 The mortgage benefits both the financier and the customer

 Like other types of real estate financing, this type of loan has many features that benefit both parties referred to earlier (the financier and the customer), as follows:

 Providing the benefit to both the client and the financier, and this is represented by the client obtaining a residence and the financier will obtain a financial benefit and guarantee his rights in the event that the client fails to pay. Obligation of the financing entity to document the terms of the mortgage contract with the Ministry of Justice in order to reduce potential disputes between the two parties to the contract.  If chosen, a mortgage with a fixed interest mortgage

 The difference between a mortgage and a mortgage

 A mortgage is a type of loan that is obtained to finance the purchase of a property

 Many of us wonder if the concept of mortgage is similar to the concept of real estate financing, which may sometimes cause wrong financial decisions, and we would like to present to you an overview of both to help you differentiate between the two types of real estate loans and the features of each.

 The main difference between mortgage and real estate financing is that in the event of a mortgage, the borrower owns the property, but he lacks money and wants to obtain it in one way or another, so he resorts to this type of loan to facilitate his financial affairs on the condition that the property he owns is mortgaged with the funder.  Real estate financing, the borrower does not own the money, not even the property, and seeks to borrow to buy a property.  So, a mortgage is a real estate loan that allows the customer to borrow money on the condition that he mortgage a property he owns. This is determined by a period of time subject to a fixed or variable interest rate (as the customer finds suitable for his needs), and it is worth noting here that in the event that the customer is unable to pay, then this  It will expose it to risks as the funder has the right to take any action it deems appropriate against him to control the mortgaged property, according to the terms of the mortgage being followed.

 As for real estate financing, it can be defined as a type of financial loan (financial aid) provided by banks and financing companies to help individuals buy a property, and it is represented by providing an amount of money that covers the client's needs to buy his dream property according to a specific interest rate according to the financial market conditions and is calculated  With the monthly installments incurred by the customer to repay the loan amount.

 The table below shows the features of each of the aforementioned types of loans, so that we can explain the concept of both in a simple and easy way, so that we may help you make a sound financial decision before embarking on a mortgage or financing request:

 Advantages of mortgage and real estate financing

 The property subject to foreclosure must be the property of the client wishing to borrow money, and the value of the property covers the amount of money that he borrowed.

 The financing provider for this loan covers a percentage of the original property price in order to help individuals buy a property, whether residential or commercial

 One of the types of financing loans that help individuals to borrow money to facilitate their commercial or personal affairs

 Individuals cannot dispose of the borrowed amount according to their desires, as they are required to use the money to buy a property in accordance with what is stipulated and specified in the contract, which is the purchase of residential or commercial real estate only

 The customer does not need to provide any guarantees other than the real estate that is mortgaged to the financier, but usually the funder will ensure the borrower's ability to pay his financial obligations.

 At the beginning of the matter, the property is subject to the ownership of the financier so that the customer can pay all the installments incurred by him, including the interest rate, whether fixed or variable (according to what is agreed upon), and then the ownership of the property is transferred to the customer

 This type of financing may not require the customer to transfer his salary to the bank or financing institution

 In the event that banks submit real estate loans, they require proof of income, and this is the guarantee between the customer and the funder. The financing authority does not grant a mortgage loan except after studying the client’s financial situation and that he is able to repay the value of the loan over the period of the loan.

 It aims to help individuals in distress and in dire need of cash who own real estate registered in their name

 The funder cannot view the financial condition of the customer without his approval

 Funding bodies are required to adhere to the provisions and legislation related to real estate mortgage in force in the country

 The customer applies for real estate financing in order to be able to buy the real estate he dreams of owning, as here it is not possible for a property to begin with

 The funder cannot view the financial condition of the customer without his approval

 The funder has the right to dispose of the property in any way in the event that the customer is unable to pay, as the purchased property is registered under the ownership of the grantor of the loan.

 So it is clear from the above that the person wishing to obtain a loan with a mortgage of the property is basically the owner of a real estate, but he desires to obtain a financial loan to facilitate his financial needs, as for real estate financing, it enables the borrower to obtain money to buy a residential or commercial property.

 Procedures for selling a mortgaged property

 Can I dispose of my mortgaged property?  A question that has always come to our minds, and in this section we will provide you with comprehensive information on this subject.  The good news is that you can dispose of your mortgaged property with the financier in terms of sale, but this may require complicated and somewhat lengthy procedures, and the details of those procedures are as follows:

 My dear who wants to sell a property mortgaged with the bank, you should inform the buyer that your property has been mortgaged with the such bank and obtain his verbal approval, and then you must sign a contract of understanding that includes all the details of the sale, its terms and conditions.  Details of the remaining amount for payment: If the property you own belongs to a developed real estate company, then you must request here a certificate stating that the developed company has no objection to selling this property, stating that the owner of the property does not have to pay any financial payments related to service fees or the like to ensure your right and the right of the buyer,  You and the buyer must register the sale of the property, so that the buyer can pay all the remaining installments, as well as to avoid any manipulations that may occur, such as selling the property again to someone else!  In order to be able to register the property, you must bring the following documents and papers: You must prepare a certificate of your ownership of the property in addition to a certificate stating the right of benefit You must sign an initial contract for registration A certificate stating the remaining amount to pay the loan in full Your ID card and the buyer has 4 checks, each one of which states  On something different as follows: A check that includes the name of the real estate seller and includes the remaining amount of the mortgage financing directed to the Department of Lands and Properties includes the value of the fees (and its value is 4%) A check for the registration fees A check that includes the name of the financier dedicated to the remaining amount must then submit a letter stating that the seller vacates the property  The financier must give the seller a letter stating that the mortgage on the property is released and as a final step, the property must be registered in the buyer's name in addition to issuing a certificate of ownership of the property to the buyer, and in order to be able to redeem the mortgage, you must submit the following documents: A copy of the original ownership certificate of the property Emirates ID for citizens and a passport for foreigners  Attached to the visa is a letter stating that the property is disassembled from the financing authority

 It should be noted that the aforementioned procedures are applied in the Emirate of Dubai in cases of selling the mortgaged property for cash, but if the buyer wishes to purchase the property with a mortgage loan, different procedures will be required.

 You should also know that you will have to pay certain fees to complete the mortgage redemption process, which are as follows:

 An early settlement fee, which is provided by the property seller, whose value is 1% of the price of the mortgaged property (not exceeding 10 thousand dirhams) a fee to restrict the sale of a mortgaged property, and the seller also incurs a fee of between 1020 dirhams and 1520 dirhams, a fee for releasing the mortgage of the property and paid by the seller, the value of which is 1290 dirhams and perhaps  Accumulating other fees A fee for issuing a No-Objection Certificate valued between 500 and 5,000 dirhams depending on the developer and paid by the seller.

You can also learn about a reverse mortgage

Fees for the mortgage

 A set of fees are incurred when obtaining a loan with a mortgage on the property, as follows:

 Legal fee Administrative fee Appraisal fee Mandatory examination fee Mandatory fees for registering the mortgaged property Fee incurred by the customer in the event of defaulting on any monthly payment Special fees in the event the customer requests to change the amount of the monthly payment If the customer wishes to change the loan maturity date If the customer wishes to renew a loan with the mortgage of the property Any other fees that can be  Appear

 Best mortgage bank

 First Abu Dhabi Bank

 About the bank

 Few words cannot describe the ancient services that First Abu Dhabi Bank provides to its individual and institutional clients, how it is ranked among the top 10 best quality banks in providing services in the United Arab Emirates.  The bank was established after a merger between two of the most famous banks in the country, namely First Gulf Bank and National Bank of Abu Dhabi.  The bank's services are not limited to financing, accounts and credit cards only, but also to include:

 Check collection Supervising clients' escrow accounts Facilitating various capital trading operations

 And other distinctive services that make it the first destination for individuals and institutions, and with regard to a mortgage loan from First Abu Dhabi Bank, the bank offers two mortgage loan programs:  Etihad Guest and mortgage of multi-storey buildings, we will provide you with details of both of them below:

 Mortgage for Etihad Guest from First Abu Dhabi Bank

 First Abu Dhabi Bank introduced the Etihad Guest program to enable you to buy or even build a property for the purpose of investment. Among the most prominent features of this loan are:

 Competitive interest rate An installment period of up to 25 years Financing up to 80% of the property price for people wishing to buy for the first time Life and property insurance Distinguished prizes for obtaining 100 miles from the Etihad Guest program when you borrow 50 thousand dirhams On the anniversary of the entitlement of the loan, you are granted 10 thousand  Miles from the Etihad Guest program

 Documents required to apply for a mortgage within the Etihad Guest program

 Submit a mortgage loan application and the customer signs it with income statements for all the documents of the property you want to buy

 Mortgage for financing the purchase of multi-storey buildings

 You can now apply for mortgage finance to buy ready-made multi-storey buildings in the UAE at competitive interest rates and financing amounting to 100 million dirhams or 70% of the property price over a period of 20 years. It is worth noting here that the property will be managed by the First Abu Dhabi Bank and you will get  Life insurance as well as property insurance.  You must submit some documents to be able to obtain the loan, and they are:

 Submit an application for financing for mortgage of multi-storey buildings All real estate papers are a statement of your monthly income

 It should be noted that a mortgage calculator, which is relatively close to the mortgage finance calculator, is available on the First Abu Dhabi Bank website, enabling you to know the amount of financing likely to be obtained, the duration of payment, etc., and we note here that these numbers are approximate and give you an overview of the potential loan you will get.

 HSBC Bank

 About the bank

 As one of the best banks in the world, HSBC Bank provides quality services related to facilitating banking services for individuals and institutions in the country and provides services in several areas including daily banking services, credit card services, loan and mortgage services, and many other services that individuals need in the UAE.

 And speaking of mortgages, HSBC offers excellent mortgage services so you can make your dream come true and buy your dream home!  Among the most prominent products related to mortgages offered by the best mortgage bank are:

 Real estate mortgage financing to buy a new home

 Competitive interest rate starting from 2.79% (for fixed interest loans and applies for one year only) Initial approval of your request within an hour only. It is not limited to diminishing interest. You can also choose a fixed interest financing feature. The advantage of reducing the total value of the interest rate throughout the loan period is called "an overpayment."  It should be noted here that the overpayments must not exceed 25% of the full amount of the loan due in the year. No salary is required to be transferred to the bank Mortgage loan calculator Financing on the last payment of the loan Fixed interest on real estate financing Non-obligatory salary transfer Fixed interest rate that starts from one year and may reach  5 years Quick approval within an hour Only Transfer of the mortgage loan to the bank The final payment of your loan will be paid.

 Mortgage terms for an HSBC loan

 All residents of the United Arab Emirates The age of the applicant ranges between 21 years and 65 years The applicant's monthly salary is not less than 15 thousand dirhams

 Mortgage redemption for an HSBC loan

 You can easily initiate the mortgage redemption process with HSBC

 It is no longer difficult to mortgage a property and later think of selling it with the best mortgage from HSBS Bank, all you have to do is to contact the bank and provide reasons for selling the property with the possibility of buying and selling offered to you, and there are 5 scenarios for the mortgage redemption process, as follows:

 Plan to sell your property to a buyer who will pay cash;  Here you must provide the name of the buyer, in addition to a copy of his passport and source of income. Selling your property to a person who has a mortgage with the same bank.  You must provide the bank with the buyer's name if you want to sell your property to someone who has a mortgage but with a funder other than HSBC;  You must provide the bank with the name of the financing agency If you want to transfer your HSBC mortgage loan to another financing entity, you must provide the bank with the name of the desired financing entity If you want to fully repay your mortgage loan from your funds;  Please provide the bank with the source of the funds

 After informing the bank of your desire to release your mortgage, the bank will present a special letter stating that you are committed to repaying the loan for the entire period, and it will include all the amounts that you have paid within 15 working days, and then you must personally sign it and present an original copy with your signature to the bank, here the bank management will direct  Mortgage redemption procedures This commitment letter is mandatory and cannot be dispensed with.

 You can pay the amount of the mortgage redemption by authorizing the bank to withdraw directly from your account with them or by increasing the bank with a check payable to HSBC. It should be noted here that if you repay the loan amount from your own owner deposited with your HSBC bank account, you will be able  From obtaining proof of mortgage redemption documents within 7 working days, and in the event of paying a check for the amount of mortgage redemption, the bank will provide you with your papers within 10 working days.

 HTTPS Bank Mortgage Procedure

 Some individuals wish to pay an amount more than the agreed monthly payment value, and we are pleased to inform you that HSBC Bank provides you with this feature and it is considered as an excess amount, provided that the value is not less than 25 thousand dirhams on the monthly installment agreed upon with the bank.  However, it should be noted that doing so requires a set of procedures, the most important of which is informing the bank in writing of your desire to pay amounts in excess of the value of your monthly installment, and from here it is worth noting that it is not possible to withdraw any of these excess amounts.  If you are wondering how to do this, you can make an overpayment online or authorize the bank to withdraw from your own account.  It is worth noting that the installment period will not be affected and will not decrease in the event of a desire to pay excess amounts, but that your scheduled monthly installment will decrease its value.

 Emirates NBD Bank

 About the bank

 Emirates NBD was established in 1963 and since then it has been known for providing leading financial and banking services to all individuals in the Emirates, and has won many awards, the most important of which is the award for the best bank in the UAE, and this was recently during the year 2020. It should be noted that this award was given to the bank for 5 consecutive years.  This indicates his distinguished services and the confidence of his customers to deal with him.  We cannot limit the services provided by the bank in a few lines, as it not only provides regular services to individuals, but also provides financial services to institutions and companies and savings solutions that you will not find like them!  Among the most important services provided by the bank:

 Individuals Services Accounts (Current, Savings, Salaries) Bank Cards Credit Cards Future Insurance Solutions Through Savings Accounts Loans (Personal, Cars, Residential) Online Banking Transactions Currency Exchange Business Services Business Banking Accounts Business Cards Long Term Financing Planning For The Future Of Business

 And many other many distinctive services, and in connection with our talk about mortgage, we are happy to inform you that Emirates NBD offers a mortgage against a loan for citizens of the United Arab Emirates and residents of the United Arab Emirates, with many features and ease of procedures.  If you are a citizen of the United Arab Emirates and own a property in the UAE, you can now with Emirates NBD to obtain mortgage financing by mortgaging your property in very easy steps!

 Advantages of mortgage loan to citizens

 Financing up to 10 million dirhams on the condition of mortgaging the owned property The loan period is up to 25 years Available to UAE citizens of individuals and self-employed employees Can obtain a loan with a ready-to-own property mortgage in any of the seven emirates Salary transfer is not required Business owners and employees will have access to loan financing service  Reducing starting from 2.50 per year No pre-approval fees required Funding for all land and property fees The property can be registered with any government agency and mortgaged with Emirates NBD

 Advantages of a mortgage loan to foreigners

 But if you are a resident of the United Arab Emirates who owns a property and would like to obtain financing with a mortgage on the property, Emirates NBD offers you a golden opportunity for that!

 Amount of financing amounting to 10 million dirhams for a period of 25 years to repay the loan Available for foreigners working in regular jobs or for their own account Specific for Dubai real estate available for freehold Transfer of income is required Financing up to 70% of the loan-to-actual value ratio (LTV) (a standard specified by the financing agencies and banks to study the need to obtain  On an additional mortgage to approve your loan application)

 All you have to do is browse the bank's website and submit an online request to know your eligibility for the best mortgage!  A detailed financing calculator is also available that enables you to calculate the loan amount that you can obtain by providing specific information such as the required loan amount, the loan repayment period, your monthly income, and other simple information.  You can always contact customer service on the following number to inquire about all the details of the mortgage terms presented in the best bank in this mortgage.

 What are the terms of the mortgage?

 Like other types of loans, there are a set of conditions that determine how the mortgage works, and they are as follows:

 The customer must pay the loan amount on time and as agreed upon with the financing authority.  If he fulfills the loan repayment, he will be able to release the mortgage, and if it does not fulfill it, then the funder has the right to sell the property to collect the loan amount.  A warning to the customer before doing so (with an emphasis here on the financier's right and legitimacy to do so) the funder has the right to dispose of the property in any way, that is, in the event that the customer fails to pay one installment and then manages to provide the amount of the installment after being unable or delaying payment  The financing party has the right to sell the property and ask the customer for the rest of the installments in one go, but in the event that the price of the property increases and its value exceeds the original value upon mortgage, then this increase is considered a right of the property owner (the funder) only, but if the value of the property decreases, the customer must pay  If one of the parties to the bet passes away, then the mortgage is considered valid and transferred to the heirs or whoever acts on behalf of the deceased person. In the event that the mortgaged property is not registered yet, the funding grantor is obligated to disclose any real or consequential right related to the mortgaged property, and from  Here, in the event that any rights arise that can affect the right of the client and arise as a result of the taxpayer's non-disclosure, then he must compensate us for the damage, and this may turn into a criminal case!

 Also, some donors of the loan for mortgage of the property set their own conditions, which you can always see and know on their own websites.

 By this, we have provided you with all the information that you must know about the concept of the mortgage, the terms of the mortgage, and the best bank in the mortgage publicly, we have provided satisfactory answers to your questions.  You can always contact our team to know more details and we are always happy to answer all your inquiries.

 What is the average mortgage interest rate?

 We all know that the types of real estate loans guaranteed by the mortgage of the real estate are divided into two parts, one with a fixed interest and the other with a variable interest, and accordingly, the interest rates differ according to the financing agency and the type of interest chosen.  Here, we would like to point out that the Central Bank of the United Arab Emirates worked to reduce interest rates, which directly affected the borrowing rate, as it decreased from 3.14% in early 2020 to 0.5% in mid-September of 2020, and consequently, mortgage interest rates decreased.

 Some studies also indicate that the mortgage interest rate has remained stable at 2.69% during 2020 compared to the same period last year, as the mortgage interest rate was 3.75% and is likely to stabilize at this level for a period of 3 years, as from  It is expected to stabilize at 2.99% for 5 years.  It is also expected that the demand for "refinancing" of mortgages will increase due to the decrease in interest rates for the next 5 years.

 How do you calculate the value of a mortgage?

 Available on the websites of the banks that grant mortgage loans to the property is an easy-to-use mortgage calculator that serves as a financial advice that enables the borrower to know his eligibility for the loan and calculate the amount of financing granted, the monthly installment and the number of years of loan repayment by providing your details such as your monthly income, your monthly expenses and other matters  Required.  You must always remember that the numbers that you will obtain through the calculator are hypothetical numbers that will give you a glimpse of your eligibility to obtain the loan and know the value of the monthly installment that you are likely to incur throughout the life of the mortgage loan, and all of them are subject to change according to the interest rate and the nature of the real estate market in  The time you want to buy a property.