Mortgage buyout guide
Mortgage Buyout in the UAE: How It Works, Costs and Refunds
By Zamran Zaharan, Founder and Senior Mortgage Broker ·
Everything you need to decide whether moving your mortgage to another bank is worth it: the process, every cost, the refunds available on selected offers, and how to release equity at the same time.
What is a mortgage buyout?
A mortgage buyout is when a new bank pays off your existing home loan and takes it over, usually at a lower rate or on better terms. You keep your property; only the lender changes. It is also called a mortgage transfer or refinancing.
When does a buyout make sense?
- Your rate is above what banks offer today.
- Your fixed period is ending, or you have already moved to a higher variable rate.
- The monthly saving pays back the switching costs well within the new fixed period.
- You want to release equity for renovation, investment or another property.
It may not pay if your balance is small, your remaining term is short, or your current bank is willing to match the new rate. That is why we always ask your bank first.
How a buyout works with FCMB
Step 1
Savings check
We compare your current rate and payment with the best buyout rate you qualify for.
Step 2
Free pre-approval
We arrange a free pre-approval from the new bank, so you know the offer is real.
Step 3
Ask your bank first
Unless the saving from switching is substantial, we try to arrange a call from your current bank's retention team for a counter offer. If they match or come close, you save without the hassle of moving.
Step 4
Switch if it pays
If there is no counter offer, or switching still saves you more, we handle the full buyout: file, valuation and final offer.
Step 5
Transfer
The new bank settles your old loan and the mortgage moves across. We stay with you until it is done.
What a buyout costs
These are the usual costs of moving a mortgage in Dubai. The example column uses an outstanding balance of AED 1,500,000 on a conventional mortgage.
| Cost | Typical amount | Example |
|---|---|---|
| Early settlement fee Your current bank1% of the outstanding balance, max AED 10,500 (incl. VAT) | 1% of the outstanding balance, max AED 10,500 (incl. VAT) | AED 10,500 |
| Valuation fee The new bank's valuerAED 3,150 (incl. VAT) | AED 3,150 (incl. VAT) | AED 3,150 |
| Mortgage release fee (old mortgage) Dubai Land Department and trustee officeAED 1,590 conventional or AED 1,890 Islamic, incl. DLD and trustee release fees | AED 1,590 conventional or AED 1,890 Islamic, incl. DLD and trustee release fees | AED 1,590 |
| DLD new mortgage registration Dubai Land Department0.25% of the loan plus AED 290 admin fee | 0.25% of the loan plus AED 290 admin fee | AED 4,040 |
| Trustee office fee (new mortgage registration) Trustee officeAED 4,200 (incl. VAT) | AED 4,200 (incl. VAT) | AED 4,200 |
| DLD title deed and knowledge fees Dubai Land DepartmentAED 270 | AED 270 | AED 270 |
| Total before refunds | AED 23,750 |
Pure buyouts have zero processing fee on selected offers.
Refunds on selected offers
On selected offers, where eligible, the new bank refunds part of your switching costs after the buyout completes:
- Early settlement fee refunded up to AED 10,000 (excl. VAT)
- Valuation fee refunded up to AED 3,000 (excl. VAT)
In the example above, refunds of AED 13,000 bring the total from AED 23,750 down to AED 10,750. You pay the costs first; the refunds are paid once the buyout is complete.
Buyout plus equity release
If your property is worth more than when you bought it, you can borrow against the extra value in the same transaction as the buyout. The new bank settles your old loan and pays you the difference, so you only go through the process once.
How much you can release depends on the bank's loan-to-value limits, a fresh valuation and your affordability. The DLD registration fee is based on the new, larger loan, and the rate on the extra amount may differ from a pure buyout. We show you both options side by side.
Who it suits
- UAE residents and non-residents
- Salaried and self-employed clients
- Anyone paying a rate above today's market
- Homeowners whose fixed period is ending soon
Documents you will need
- Emirates ID
- Passport and visa
- Salary certificate
- 6 months of bank statements
- Title deed
- Latest loan statement or outstanding balance letter
- Latest AECB credit report
Self-employed? We will tell you which company documents your chosen bank needs.
Mortgage buyout FAQs
What is a mortgage buyout?
A mortgage buyout is when a new bank pays off your existing home loan and takes it over, usually at a lower rate or on better terms. You keep your property; only the lender changes.
What is the early settlement fee?
Your current bank usually charges an early settlement fee of 1% of the outstanding balance, up to AED 10,500 (incl. VAT). On selected offers, it is refunded up to AED 10,000 (excl. VAT) after the buyout completes, where eligible.
What does a buyout cost in total?
The main costs are the early settlement fee (1% of the balance, up to AED 10,500 incl. VAT), the valuation fee (AED 3,150 incl. VAT), the mortgage release fee for the old mortgage (AED 1,590 conventional or AED 1,890 Islamic, incl. DLD and trustee release fees), DLD registration of the new mortgage (0.25% of the loan plus AED 290), the trustee office fee for the new mortgage registration (AED 4,200 incl. VAT) and DLD title deed and knowledge fees (AED 270). On selected offers, the early settlement fee is refunded up to AED 10,000 and the valuation fee up to AED 3,000 (excl. VAT) after the buyout completes, where eligible.
How long does a mortgage buyout take?
A mortgage buyout usually takes 2 to 4 weeks, depending on the bank, your documents and the complexity of the case.
Can non-residents switch their mortgage to another bank?
Yes. Several of the banks we work with refinance mortgages for non-residents, although loan-to-value limits and rates can differ from those for UAE residents.
Can I release equity at the same time as the buyout?
Yes. If your property has gone up in value, you can borrow against the extra equity in the same transaction, subject to the bank's loan-to-value limits and your affordability.
Do I need to transfer my salary to the new bank?
Not always. The lowest rates usually need a salary transfer, but there are also options without one, normally at a slightly higher rate.
See your own numbers
Check your saving, switching costs and break-even month in under a minute, or ask us for a free savings check.
