Refinancing a UAE home loan is cheaper than most borrowers assume, because the Central Bank caps what your existing lender can charge you to leave. Under the amendment to Appendix 2 of Regulation 29/2011, the early settlement or partial settlement fee on a home loan is capped at 1% of the outstanding balance or AED 10,000, whichever is less. On a AED 1.5 million balance that is AED 10,000, not AED 15,000, and not the 3% many borrowers still expect.
The other half of the cost sits with the Dubai Land Department, and it is smaller than the internet suggests because a bank-to-bank move is a single registered procedure rather than a release followed by a fresh registration. This guide sets out the full published fee stack for a buyout, the Central Bank ratios that decide how much you can actually borrow on a refinance, why an equity release is capped by the same loan-to-value table as a purchase, the exact documents the Land Department asks for, and the situations where refinancing costs more than it saves.
Refinance, Buyout and Equity Release: What the Terms Mean Here
A buyout moves an existing mortgage from one UAE lender to another at the same or a lower balance. An equity release, sometimes marketed as a top-up, increases the loan against a property you already own and releases the difference in cash. Both are treated as new mortgage lending by the Central Bank and are subject to the same loan-to-value ceilings and the same 50% debt burden ratio as a purchase.
The distinction matters because the pricing differs. A straight buyout at the same balance is usually the cheaper of the two, since the Land Department fee is charged on the mortgage value being registered. An equity release raises that value, so the 0.25% registration charge rises with it, and the new balance has to clear the loan-to-value test at today’s valuation rather than the valuation used when you bought.
UAE lenders also use “refinance” loosely for an internal rate renegotiation with your existing bank, which involves no Land Department transaction at all. That is worth asking for first, because it avoids the entire registration cost stack described below, though it rarely produces the same rate as a competitive buyout.
The Full Cost of a Mortgage Buyout in Dubai
Budget for three separate cost blocks: the exit fee to your current lender, capped at 1% of the outstanding balance or AED 10,000 whichever is less; the Dubai Land Department mortgage transfer at 0.25% of the mortgage value plus AED 250 for the title deed and AED 20 in knowledge and innovation fees; and the trustee office service fee of AED 4,000 plus VAT.
The Land Department publishes mortgage transfer as its own e-service, distinct from mortgage registration and from mortgage release. Its published fee schedule is 0.25% of the mortgage value for an ordinary mortgage, AED 250 for issuance of the title deed, AED 10 knowledge and AED 10 innovation fees per drawing, and a service partner fee of AED 4,000 plus VAT, rising to AED 5,000 plus VAT where the property is a provisional sale. Service time is stated as 15 to 20 minutes once you are at the counter.
Worked example on a AED 1.5 million balance
| Cost line | Basis | Amount (AED) |
|---|---|---|
| Early settlement fee to the outgoing bank | 1% of outstanding, capped at 10,000 | 10,000 |
| DLD mortgage transfer registration | 0.25% of the mortgage value | 3,750 |
| Title deed issuance | Fixed | 250 |
| Knowledge and innovation fees | AED 10 each per drawing | 20 |
| Trustee office service fee | Fixed, plus VAT | 4,000 + VAT |
| Liability letter from the outgoing bank | Capped by the Central Bank | 85 |
| NOC issuance | Capped by the Central Bank | 150 |
| Indicative total before VAT and valuation | 18,255 |
Two lines are deliberately missing from that table. The incoming bank’s own arrangement or processing fee is not capped by the Central Bank and varies by lender, and the property valuation the new lender commissions is a commercial charge with no published tariff. Neither can be verified from an official source, so neither is stated here as a figure. Ask for both in writing before signing anything, because together they can add more than the Land Department charges.
The Central Bank fee caps your bank has to respect
Appendix 2 of Regulation 29/2011 sets maximum limits for fees and commissions on retail customer services, and the home loan lines are rarely reproduced anywhere. All figures are exclusive of VAT.
| Home loan service | Maximum the bank may charge |
|---|---|
| Early settlement fee | 1% of outstanding balance or AED 10,000, whichever is less |
| Partial settlement charges | 1% of outstanding balance or AED 10,000, whichever is less |
| Late payment fees | AED 700 |
| Issuance of liability letter | AED 85 |
| Issuance of NOC | AED 150 |
| Clearance letter | AED 95 |
| Other certificate | AED 75 |
| Request of other letters | AED 90 |
| Non-standard statement or copy of original documentation | AED 100 |
| Property swaps administration fee | AED 1,320, valuation included |
What actually happens if your bank overcharges
The amendment did more than reset the cap. Its second operative paragraph required banks and finance companies that had “arbitrarily changed the stated terms of the fees in existing customer agreements” to respect the original terms and refund all overcharges to customers based on their original fee within 30 days of the notice. The caps themselves are described as maximum permissible charges, and the Central Bank states it will supervise regulated entities to ensure they “do not automatically default to using maximum caps where actual costs may be lower.”
Banks must also notify and obtain Central Bank approval in advance for any new fee, or any change to an existing fee level larger than 5%, where that fee is not already capped. Those submissions may only be made during the first five business days of April and October each year. A fee that appears mid-year on a product that previously did not carry it is therefore worth questioning.
How Much You Can Borrow on a Refinance
Refinancing does not escape the loan-to-value table. An expatriate refinancing a first, owner-occupied home worth less than AED 5 million is capped at 80% of the property’s value; above AED 5 million the cap is 70%. A second or investment property is capped at 60% regardless of value, and an off-plan property at 50% for every category of buyer.
Article 3 of the Central Bank’s mortgage loan ratios sets the whole framework, and the numbers below are the operative ceilings rather than an individual bank’s appetite.
| Borrower and property | Maximum loan to value |
|---|---|
| UAE national, first home, value up to AED 5 million | 85% |
| UAE national, first home, value above AED 5 million | 75% |
| UAE national, second or investment property | 65% |
| Expatriate, first home, value under AED 5 million | 80% |
| Expatriate, first home, value above AED 5 million | 70% |
| Expatriate, second or investment property | 60% |
| Any borrower, property purchased off plan | 50% |
The regulation is explicit that each borrower can claim only one property under the first home, owner-occupier category. If you already used that allowance, a refinance on a second property runs into the 60% ceiling even if the first mortgage was written at 80%. This is the most common reason an equity release comes back smaller than the borrower expected. The rules and ceilings are the same ones covered in detail under mortgage down payment requirements for foreigners.
The debt burden ratio and the stress test
The maximum debt burden ratio is 50% of gross salary and any regular income from a defined and specific source. The Central Bank adds that lenders should not automatically apply the maximum and must consider the borrower’s specific circumstances.
The stress test is the part that catches refinancers. Lenders are required to test the loan at 2 to 4 percentage points above the current interest rate, depending on where rates sit in the cycle. Where an introductory rate applies, the test must be carried out against the rate that applies once the introductory period ends. A buyout marketed on a low fixed teaser is therefore underwritten against the reversion rate, not the headline.
Two further constraints bite on specific profiles. Where the property is for investment, the lender must deduct at least two months of rental income from the debt burden calculation to allow for void periods. Where the repayment schedule extends beyond expected retirement age, the lender must be satisfied that the balance outstanding at that point can still be serviced at 50% of post-retirement income. The total financing amount is separately capped at seven years of annual income for expatriates and eight years for UAE nationals, and the maximum tenor of any mortgage is 25 years.
Where the money for a shortfall may not come from
If your refinance leaves a gap you have to bridge, the risk management requirements close off the obvious route. The regulation states that the level of down payment required from the borrower “should be drawn from the borrower’s own resources and not from other sources of borrowing (including personal loans or credit cards),” and expects lending policies to be explicit about it. Covering a refinance shortfall with a personal loan is not a workaround; it is the specific behavior the rule targets.
The same article bars lenders from underwriting on optimism. The assessment of ability to repay “should not be based on future property price appreciation or an expected increase in the borrower’s earning capacity,” and property appraisal reports “should not reflect expected future house price appreciation.”
Valuation: The Step That Decides Everything
Before any irrevocable commitment to lend, an independent on-site valuation must be carried out by a suitably qualified third party who is independent of the borrower, the seller, the developer or contractor, and the loan decision process. Each bank must maintain a board-approved list of independent valuers.
This is why you cannot bring your own number to a refinance. The new lender’s panel valuer sets the figure that the loan-to-value ceiling is applied to, and if that figure comes in below your expectation, the maximum loan falls with it. The difference between a bank’s valuation and the Land Department’s own valuation certificate is a recurring source of confusion, and is worth understanding before you commission anything, as set out under DLD versus bank property valuation in Dubai.
What actually happens at the trustee office
The Land Department gives two channels for a mortgage transfer: its own online mortgage system, used by the bank on your behalf, and a Real Estate Registration Trustee center. Through the online route the customer prepares the requirements with the bank, the bank uploads the documents through the digital safe, the department audits the transaction and deducts the fees from the bank’s account, and the outputs arrive by email. Through the trustee route you attend in person, the employee verifies the file and enters the transaction, you pay, and the outputs are emailed. Payment is accepted by epay, the Sadad Dubai platform, Noqodi or manager’s cheque.
Documents the Land Department asks for
- A no-objection of mortgage transfer letter from the previous bank
- A letter from the new bank regarding mortgage registration
- Three certified mortgage contracts
- An electronic NOC from the developer where the property is a provisional sale
- Emirates ID, for identification only, with no copy submitted
- A legal power of attorney where someone is acting for you, which has to be notarized in the way described under the UAE power of attorney process
Companies and individual establishments substitute a trade license and the passport or Emirates ID of the authorized signatory, with power of attorney documentation where relevant.
When Refinancing Is Not Worth It
When the payback period outruns your horizon
On the worked example above, the switching cost is roughly AED 18,000 before VAT, valuation and the incoming bank’s own fees. A 0.5 percentage point saving on a AED 1.5 million balance is around AED 7,500 in the first year and falls as the balance amortizes. That is a payback measured in years, not months, so a buyout only pays for an owner who intends to keep both the property and the loan well past that point.
When you are close to selling
If a sale is realistic within the payback window, the switching cost is simply lost. Selling with a mortgage in place has its own sequence and its own charges, covered under how to sell a mortgaged property in Dubai, and a fresh registration immediately before a sale adds cost to both transactions.
When the new loan resets the clock
A buyout that restores the tenor to 25 years lowers the monthly payment but increases total interest paid. The Central Bank’s maximum tenor is 25 years, and lenders are free to offer less. Compare the total cost over the remaining original term, not the monthly figure, which is the same discipline applied under the mortgage versus cash purchase comparison.
When your income profile has changed
A refinance is fresh underwriting. If your salary structure has shifted, if you have moved to self-employment, or if you have taken on other debt since the original approval, the 50% debt burden ratio is recalculated on today’s position. Repayment must come from salary or verifiable business or rental income, and the regulation states plainly that the use of end of service benefit is not allowed as a source of repayment. Borrowers who expect gratuity to carry the loan are relying on something the rules exclude. The current-position check is the same one described under the Dubai mortgage pre-approval process, and a fresh pre-approval is the cheapest way to find out where you stand before committing to any fees.
Frequently Asked Questions
What is the early settlement fee on a UAE mortgage?
The Central Bank caps it at 1% of the outstanding balance or AED 10,000, whichever is less, and the same cap applies to partial settlement. The cap was set by a Board of Directors decision amending Appendix 2 of Regulation 29/2011, effective October 2019, which reverted the figure from the 3% some lenders had moved to. The cap is a maximum, not a standard charge, and banks are supervised against defaulting to it.
How much does it cost to transfer a mortgage to another bank in Dubai?
The Dubai Land Department charges 0.25% of the mortgage value plus AED 250 for the title deed and AED 10 each in knowledge and innovation fees, with a trustee service partner fee of AED 4,000 plus VAT, or AED 5,000 plus VAT for a provisional sale. On top of that sits the outgoing bank’s early settlement fee, capped at AED 10,000, and its liability letter and NOC at AED 85 and AED 150. The incoming bank’s processing fee and the valuation are commercial charges with no published cap.
Can I release equity from my Dubai property?
Yes, subject to the same loan-to-value ceilings as a purchase. An expatriate is limited to 80% on a first, owner-occupied home under AED 5 million, 70% above that, and 60% on a second or investment property, applied to the new independent valuation rather than your purchase price. The debt burden ratio of 50% of gross income applies to the enlarged loan, and the total financing amount is capped at seven years of annual income for expatriates.
Do I have to pay the 4% DLD transfer fee again when I refinance?
No. The 4% property transfer fee applies to a change of ownership. A mortgage transfer changes only the registered mortgagee, and the Land Department charges it at 0.25% of the mortgage value plus the fixed lines. Ownership is unchanged, so the transfer fee is not triggered.
How long does a mortgage buyout take in the UAE?
The Land Department states a service time of 15 to 20 minutes for the mortgage transfer transaction itself. The elapsed time for the whole process is driven by the new lender’s underwriting, the panel valuation and the outgoing bank’s issuance of the liability letter and no-objection letter, none of which has a published service standard. No official source publishes an end-to-end timeline, so this article does not state one.
Can I use a personal loan to cover a refinancing shortfall?
The Central Bank’s risk management requirements state that the down payment should come from the borrower’s own resources and not from other sources of borrowing, including personal loans or credit cards, and expects lenders to make this explicit in their lending policies. A personal loan taken to bridge a shortfall also loads the debt burden ratio that the same refinance is being underwritten against.
What is the maximum mortgage term in the UAE?
Twenty-five years. The maximum age at the last repayment is left to each lender’s own risk management and lending policies rather than fixed by regulation, but where the schedule runs past expected retirement, the lender must be satisfied the outstanding balance can be serviced at 50% of post-retirement income.
Will a lender refinance an off-plan property?
The loan-to-value ceiling for a property purchased off plan is 50%, regardless of purpose, value or category of purchaser, which the regulation attributes to the long-term nature of development and the higher risk to completion. Where stage payments are financed, the lender must apply the owner’s equity portion to the developer before releasing any loan money, and milestone completion has to be physically confirmed by the lender or an independent qualified agent.
Does a buyout require a new title deed?
The Land Department lists issuance of the title deed at AED 250 within the mortgage transfer fee schedule, and the issued documents include a certificate of title, title deed, statement certificate or provisional sale registration certificate, delivered electronically. The underlying ownership does not change.
Can I refinance if I am renting the property out?
Yes, but it is treated as an investment property. The loan-to-value ceiling falls to 60% for expatriates and 65% for UAE nationals, and the lender must deduct at least two months of rental income from the debt burden calculation to account for void periods. Where the property is already mortgaged and tenanted, the interaction with the existing lease matters, and is covered under the rules on renting out a mortgaged property in Dubai.
Official Sources
- CBUAE Rulebook – Amendments to Appendix 2 of Regulation No. 29/2011, Maximum Limits for Fees and Commissions Charged on Retail Customer Service
- CBUAE Rulebook – Mortgage Loans Regulation, Article 3: Important Ratios
- CBUAE Rulebook – Mortgage Loans Regulation, Article 2: Risk Management Requirements
- Dubai Land Department – Mortgage transfer application
- Dubai Land Department – Mortgage release application
- Dubai Land Department – Mortgage registration application
Information is current as of August 2026. Limitations are stated rather than smoothed over. The fee caps and mortgage ratios above were read from the Central Bank of the UAE Rulebook, retrieved through archived copies of the official pages because rulebook.centralbank.ae refuses automated requests from our network. The Land Department fees were read directly from its own e-service pages. Three figures a borrower needs are deliberately not quoted anywhere in this article because no authority publishes them: the incoming bank’s arrangement or processing fee, the panel valuation fee, and the end-to-end elapsed time for a buyout. Get all three in writing from the lender before committing. The worked example uses the published caps and rates applied to a stated balance and is a calculation, not a quotation. Fees are exclusive of VAT unless stated, and the Central Bank reviews its fee caps annually, so confirm the current Appendix 2 before relying on a figure. Abu Dhabi and the northern emirates register mortgages through their own land authorities on different fee schedules; the registration figures here are Dubai only. This article explains published rules and is not financial advice. Confirm your position with your lender and, where the sums are material, an independent adviser before switching.
