How does a Murabaha Islamic mortgage work in the UAE?

In a Murabaha structure, the bank purchases the property on your behalf and immediately sells it to you at a higher price that includes an agreed profit margin. You repay this total price (the cost plus profit) in instalments over the mortgage term. No interest is charged at any point — the profit is fixed at the outset. This structure is used by ADIB, Emirates Islamic, and other UAE Islamic banks to provide Sharia-compliant home finance.

What is the maximum mortgage term in the UAE?

UAE banks typically offer mortgage terms of up to 25 years for salaried employees and up to 20 years for self-employed borrowers. The maximum term may also be limited by the borrower's age — most banks require the mortgage to be fully repaid before age 65 (salaried) or 70 (self-employed). Longer terms reduce monthly payments but increase total interest paid over the life of the loan.

UAE Mortgage Guides — By Location and Buyer Type

Getting a mortgage in the UAE involves understanding four main product types, each suited to different circumstances. A home purchase loan finances the acquisition of a completed, ready-to-move-in property — the most common type, with maximum LTV of 80% for expats and 85% for UAE nationals on properties under AED 5 million. Refinancing allows borrowers to transfer an existing mortgage to a better rate, often saving hundreds of dirhams per month. Off-plan mortgages finance properties still under construction, with a maximum LTV of 50% during the build phase per UAE Central Bank regulations. Islamic mortgages use Sharia-compliant profit-rate structures (Murabaha or Diminishing Musharaka) that avoid interest entirely and are available from ADIB, DIB, Emirates Islamic, and Al Hilal Bank.

The right mortgage also depends on who you are. UAE nationals benefit from higher LTV limits and may access government housing schemes. Expatriates must provide a valid UAE residence visa and typically need a minimum salary of AED 15,000 per month. Self-employed borrowers require 2 years of audited accounts. First-time buyers face different down-payment requirements and may qualify for developer payment plan arrangements. Use the guides below to find the advice most relevant to your location and buyer profile.

UAE Mortgage Types at a Glance

Mortgage Type	Purpose	Max LTV	Key Feature
Home Purchase Loan	Buy a completed, ready property	80% (expat) / 85% (national) under AED 5M	Most common; immediate occupation on completion
Refinancing	Switch existing loan to a better rate	Up to 80% of current property value	Can reduce monthly payment or shorten loan term
Off-Plan Mortgage	Finance a property under construction	50% during construction phase	Payments aligned to construction milestones
Islamic Mortgage	Sharia-compliant home finance	Up to 80% (similar to conventional)	Profit-rate structure; no interest charged

Mortgage Guides by Location

Mortgage Guides by Buyer Type

Frequently Asked Questions — UAE Mortgage Types

What types of mortgages are available in the UAE?

The four main categories are: Home Purchase Loans (for completed properties), Refinancing (switching to a better rate), Off-Plan Mortgages (for properties under construction), and Islamic Mortgages (Sharia-compliant profit-rate structures). Each has different LTV limits, eligibility criteria, and fee structures.

What is an off-plan mortgage in the UAE?

An off-plan mortgage finances the purchase of a property still under construction. The UAE Central Bank caps LTV at 50% during the construction phase. Payments are typically structured in milestones aligned to build progress. Once the property is completed and registered, standard LTV limits apply.

How does a Murabaha Islamic mortgage work?

In a Murabaha structure, the bank purchases the property on your behalf and sells it to you at a higher price that includes an agreed profit margin. You repay this total in instalments — no interest is charged at any point. ADIB, Emirates Islamic, and DIB all offer this structure for UAE home finance.

Can I refinance my existing UAE mortgage?

Yes. Refinancing lets you switch to a lower rate or restructure your existing loan. You must factor in the early settlement fee (capped at 1% of outstanding balance or 3 months' interest, whichever is lower) and new mortgage registration fees before calculating whether refinancing saves you money overall.

What is the maximum UAE mortgage term?

UAE banks typically offer up to 25 years for salaried employees and 20 years for self-employed borrowers. The term is also limited by age — most banks require the loan to be fully repaid before age 65 (salaried) or 70 (self-employed).

Related Resources

Also explore: UAE Mortgage Banks | Bank Comparisons | Mortgage Calculator

UAE Mortgage Guides

Q: What types of mortgages are available in the UAE?

The four main UAE mortgage categories are: (1) Home Purchase Loans for buying a completed (ready-to-move-in) property; (2) Refinancing, where you switch an existing mortgage to a better rate or longer term; (3) Off-Plan Mortgages for buying a property that is still under construction; and (4) Islamic Mortgages, which use Sharia-compliant profit-rate structures such as Murabaha or Diminishing Musharaka instead of conventional interest.

Q: What is an off-plan mortgage in the UAE?

An off-plan mortgage finances the purchase of a property that is still under construction. Under UAE Central Bank rules, the maximum LTV on an off-plan property is typically 50% during the construction phase. Payments are usually structured in milestones aligned to construction progress. Once the property is completed and registered, LTV limits revert to the standard completed-property thresholds (80% for expats, 85% for UAE nationals on properties under AED 5 million).

Q: Can I refinance my existing UAE mortgage?

Yes. Refinancing allows you to switch your current mortgage to a new lender offering a lower rate, or to restructure your existing loan with your current bank. Common reasons to refinance include: moving from a variable rate to a fixed rate, reducing the monthly payment, shortening the loan term, or releasing equity. Costs to consider include the early settlement fee (capped at 1% of outstanding balance or 3 months' interest) and new mortgage registration fees.

Find the right mortgage for your location and situation. Whether you're buying in Dubai Marina, Downtown Dubai, or as an expat first-time buyer — Mortigo has a tailored guide for you.