Personal Loan Application in Dubai: Everything You Need To Know

Wednesday, April 11, 2018

Personal Loan Application in Dubai: Everything You Need To Know

If your recent move to Dubai has become a financial burden, or if you’re in need of substantial emergency funds, a personal loan can allow you to settle in easier, or provide immediate relief. Personal loans are readily available in Dubai and are usually paid off in monthly installments.

Moreover, they can be used for many purposes. In fact, most expats apply for personal loans in Dubai to pay for their annual rent or their children’s school fees. A personal loan can also be used for weddings, home renovations, and other purposes.

Yet, a personal loan application may seem like a stressful process for some. Here are some crucial things you must know before getting a personal loan in Dubai.

3 Types of Personal Loans

1.     Personal Loans for UAE Nationals

This type of personal loan has highly favorable terms and conditions, and the eligibility criteria are flexible. Interest rates are also attractive, and the documentation process is straightforward and simple.

2.     Personal Loans for Expats

The terms and conditions of this type of personal loan are different from those offered to UAE nationals. Still, the deals are also attractive, with banks giving flexible terms in terms of the loan amount and repayment period.

3.     Personal Loans for Self-Employed Individuals

People who run their own business might find it too challenging to get a personal loan. This is because their source of income is not stable. But don’t lose hope since there are banks that can still offer you good personal loan terms. You need only provide the necessary documentation of your source of income.

2 Types of Interest Rates

1.     Flat Rate of Interest

A flat rate of interest on your loan implies that the sum payable and the interest are calculated at the beginning of the repayment. And this will remain that way until you have fully paid the money you borrowed.

2.     Reducing Rate of Interest

A reducing rate of interest works by decreasing the principal loan amount after every installment. The constant interest percentage is reduced every month, resulting in different monthly installments.

5 Factors that Affect the Success of Your Application


Banks offer different maximum loan amounts, minimum salary requirements, early settlement fees, interest rates, and other requirements. So you need to compare their personal loan features and choose one that best meets your specific needs.

The success of your application will depend on the following factors so you need to consider each point prior to filling in the application form.

1.     Minimum Salary

Every bank will set its own minimum salary requirements. This means that those with higher salaries will be offered more opportunities to get a loan. Though people with low salaries can be given a personal loan, bear in mind that the Central Bank of UAE

Regulations state that repayment amounts of your total credit must not exceed half of your monthly salary.

2.     Listed Employer

There are some banks that will turn down your personal loan application if your employer is not included on their pre-approved employer list.

3.     Salary Transfer to the Same Bank

Most Dubai banks make it mandatory for applicants to have an account with the same bank. You may be offered better rates if you have a salary transfer account because you will be seen as a low risk customer.

4.     Period of Employment

You will get a better chance of getting a personal loan if you have long been working with your employer. Leading local bank branches, for instance, favor clients who have proof that they’re in a stable, permanent job.

It is also easier for employed individuals to get a personal loan than those who are self-employed. As a salaried expat, you will be offered more options.

5.     Credit History

If you do not have any existing debts, your loan application will most likely be approved. But if you have lots of debt and you have missed repayments on your credit card or other loans, you may not be able to take out a personal loan.

So you should take care of your credit history. Pay your monthly installments as early as you can – even a one day delay of payment can ruin your credit record.

General Requirements for Both Expatriates and UAE Nationals


Most banks in Dubai require applicants to:

       Be 21 years old or older, but should not be over 60 years old for UAE nationals and 65 for expats
       Be earning a minimum of AED 3,000 although some banks prefer a minimum salary of AED 15,000
       Have one to six months length of service
       Have a salary transfer account

Required Documents


The documents you must submit for a successful application may vary from one bank to another. In general, though, here are the documents you might want to have on you:

       A fully completed loan application form
       Means of identification that includes your Emirates ID,  passport copy and/or visa copy
       Copy of your valid passport with a valid UAE residence visa for expats
       Bank statement for the past three to six months
       A trade license for self-employed individuals
       A salary certificate, payslip (last three months) or a salary transfer letter for salaried e mployees

With the loan services readily available in various financial institutions and advancements in technology, applying for a personal loan has definitely become exceptionally easy. And with the above need-to-know information, it’s even easier and more stress-free. Good luck!

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