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ArticlesA down payment is the part of a purchase price that you pay from your own funds rather than finance through the loan or mortgage. In the UAE, the minimum effective down payment depends on the product and the applicable loan-to-value limit. For mortgages, the required contribution varies by nationality, property value and whether the property is a first home, subsequent property or off-plan purchase. For private car finance, the 80% financing cap implies at least a 20% borrower contribution toward the vehicle value.
Mortgage down payment and LTV
CBUAE mortgage rules set maximum Loan-to-Value ratios. The difference between the property value and the maximum mortgage amount represents the minimum equity contribution before other purchase costs.
| Borrower / property type | Maximum LTV | Minimum equity implied by LTV |
|---|---|---|
| UAE national — first owner-occupied home, AED 5m or less | 85% | 15% |
| UAE national — first owner-occupied home, above AED 5m | 75% | 25% |
| Expatriate — first owner-occupied home, AED 5m or less | 80% | 20% |
| Expatriate — first owner-occupied home, above AED 5m | 70% | 30% |
| UAE national — second/subsequent or investment property | 65% | 35% |
| Expatriate — second/subsequent or investment property | 60% | 40% |
| Off-plan property — all categories | 50% | 50% |
Important: the mortgage down payment should come from your own resources
CBUAE mortgage regulations state that the borrower’s required down payment should be drawn from the borrower’s own resources and not from other borrowing such as personal loans or credit cards. This is designed to ensure the borrower has genuine financial equity in the property.
Example: expatriate first home worth AED 2 million
Illustration only: with a maximum LTV of 80%, the maximum mortgage would be AED 1.6 million. The minimum equity contribution implied by the LTV is AED 400,000. Registration, valuation, broker, bank, insurance and other property-purchase costs can be additional and are not automatically covered by this calculation.
Auto-loan down payment
CBUAE rules limit private car loans to 80% of the financed vehicle’s value. That means at least 20% of the vehicle value must generally be funded outside the car loan, subject to the lender’s policy and valuation.
Why does a larger down payment matter?
- It reduces the amount financed.
- It can reduce monthly repayments.
- It can lower total financing cost.
- It creates more equity in the asset from the start.
- It may make the requested financing amount more affordable, although approval is never guaranteed.
Frequently asked questions
What is the minimum mortgage down payment for an expatriate first home under AED 5 million?
The current maximum LTV is 80%, implying at least 20% equity from the borrower.
What is the minimum mortgage down payment for a UAE national first home under AED 5 million?
The current maximum LTV is 85%, implying at least 15% equity, subject to applicable rules and lender approval.
Can I use a personal loan for my mortgage down payment?
CBUAE mortgage rules state that the required down payment should come from the borrower’s own resources rather than other borrowing such as personal loans or credit cards.
Do purchase fees count as part of the down payment?
Not automatically. Transaction costs can be separate from the equity contribution calculated from the LTV.
Is the car down payment always exactly 20%?
The regulatory financing cap is 80% of vehicle value, so at least 20% is implied. A lender may finance less than 80%, which would require a larger contribution.