Mortgage registration

A mortgage over UAE property is only valid once it is registered with the land department of the emirate concerned. Registration notes the bank's interest on the title deed, which prevents the property being sold or re-mortgaged without the lender's consent.

In Dubai the Dubai Land Department charges 0.25% of the loan amount, plus a small administration fee. On a loan of AED 1 million that is AED 2,500 plus the admin charge. The fee is paid by the borrower and settled at the trustee office on the day of transfer, alongside the 4% transfer fee. In Abu Dhabi the registration fee is lower; it is widely quoted at 0.1% of the loan, so confirm the current figure with your lender.

Note what the percentage applies to. The 4% transfer fee is charged on the purchase price; the mortgage fee is charged on the amount borrowed. When the loan is eventually repaid, a separate fixed fee is charged to release the mortgage, and moving the loan to another bank means paying for release and a fresh registration.

These are land department fees and come on top of the bank's own costs: an arrangement fee, the valuation and usually life and property insurance. Budget for them in cash, since lenders do not add purchase costs to the loan. See the guide to non-resident mortgages.