Payment plan

Off-plan homes in the UAE are paid for in stages set out in the SPA. Plans are described by a pair of numbers: the share paid before completion and the share paid at or after it. A 60/40 plan means 60% during construction and 40% on handover; 80/20 means 80% and 20%.

A typical plan has three parts: a booking deposit (reservation fee) of 10% to 20%, a series of instalments during construction, and a final payment on completion. Some add a fourth, spread after handover; see post-handover payment plan. Instalments are interest-free and go into the project's escrow account.

Read the triggers. Instalments are either date-linked, falling due on fixed calendar dates whatever is happening on site, or construction-linked, falling due when a certified stage such as 30% completion is reached. Construction-linked plans protect the buyer better, since you pay only as the building progresses. With a date-linked plan you can find yourself well ahead of the construction.

Points buyers overlook:

• The 4% transfer fee is due at the start, on the whole price, on top of the deposit.
• A back-loaded plan lowers the early outlay, not the price. The balance at handover must be found in cash or by mortgage, and lending is not assured.
• Generous plans are a form of discount. Compare the price with similar units sold on standard terms.
• Missing an instalment triggers the default procedure, not a renegotiation.

More detail is in off-plan payment plans explained.