How can borrowers improve their chances of mortgage approval?

Possibility to get a mortgage in Dubai may be rather challenging, however a borrower may take several actions and steps to enhance the probability of receiving an approval. Here’s a comprehensive guide to enhancing your mortgage application:

1. Assess Your Financial Health

Therefore, it all starts with having a good feel of the kind of financial situation that the applicant is in before applying for the loan. Your total own income after tax, your expenses and your liabilities should be determined to see how much you can afford to pay as mortgage. Staying financially healthy requires the most important asset to remain healthy and not to be under any bond thus having least debt ratio.

2. Credit Check: How to Establish a Healthy Credit Rating

credit scores are very important when it comes to approval of mortgage. Lenders seek a good credit history as this is a sign that he or she is capable of repaying his/her debts. Several tips you can deem useful which could include paying bills on time, minimizing your credit utilization and avoiding any credit application shortly before applying for a mortgage.

3. Should Have Money to Make a Considerable Down Payment

Making a higher down payment means that you will borrow less which will help you with the approval status and may even make you get better interest rates in the process. All the lenders with some few exceptions demand their borrowers to pay a minimum of 20% as down payment, though more is better.

4. Reduce Existing Debts

Reducing the existing debts also means that the credit-to-income ratio shall have boosted and hence an excellent proposition for a mortgage. Eliminating credit card balance, personal loans and other debt will go along way in staging a better financial credit to the lender.

5. Get Pre-Approved

Mortgage pre-approvals are essential since they make sellers and lenders consider you as a serious buyer. It is the first screening of your financial situation, from which, you get an indication of the amount you qualify to borrow. This step can help to lower the mortgage time and increase your chances of receiving the best mortgage deal.

6. Organize Your Documentation

The documents that you would need are passport, Emirates ID, proof of income, bank statements, credit report among others should be prepared in advance. To avoid unnecessary extension of time, it is good to have all documents ready as this would show that you are organized and that you are serious with what you are doing.

7. Consult a Mortgage Broker

It important that one seeks help from a good mortgage broker especially when one is in the process of acquiring a mortgage. They are extremely knowledgeable about all types of lenders; therefore, they will connect you to lenders whom you can discuss with and offer a loan that suits your situation. Brokers can also help with the paperwork, bargaining and generally with all aspects of the application process.

8. The last strategic step is a need to understand the market

It is very important to monitor or get updates on the Dubai real estate and more specifically the mortgage laws and reforms that may be made in the future. It is essential to learn the aspects that determine the mortgage rates and the terms to be in a position to select the best time to apply for mortgage.

To achieve this you can take the following measures to increase your probability of getting mortgage approval and repay it with preferable rates. There are three main strategies that should be followed when applying for a mortgage in Dubai, they include; doing your homework properly, handling your money wisely and consulting.


Improving Your Chances of Mortgage Approval Quiz

Test your knowledge on how borrowers can improve their chances of mortgage approval. Once you complete the quiz, click the button to see your score and the correct answers.

  1. What is one of the first steps you should take before applying for a mortgage?




  2. How can improving your credit score affect your mortgage application?




  3. Why is saving for a substantial down payment important?




  4. What is the benefit of obtaining a mortgage pre-approval?




  5. How can a mortgage broker assist in the mortgage application process?




Quiz content credit to 95dubai.com

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