This refers to the interest that is earned but not paid. It is the interest that adds to the overall amount owed.
The date that the interest rate changes on an adjustable rate mortgage (ARM).
An analysis of a buyer’s ability to afford the purchase of a home. Reviews income, liabilities, and available funds, and considers the type of mortgage you plan to use, the area where you want to purchase a home, and the closing costs that are likely.
The gradual repayment of a mortgage loan, both principal and interest, by installments.
Loan amortization is what we call the process of paying off a loan over time. When you get a mortgage, you’ll make a payment every month.
By making regular payments over the lifetime of your loan – also known as the amortization period – your balance will eventually reach A.E.D 0. When it does, your mortgage will be amortized – meaning it’s been completely paid off.
The length of time required to amortize the mortgage loan expressed as a number of months. For example, 300 months is the amortization term for a 25-year fixed rate mortgage.
An agreement or promise, often in writing, between a lender and a borrower to provide financing at a future date, subject to the completion of paperwork or compliance with stated conditions.
Financing, to pay for the construction of buildings or homes. These are usually designed to provide periodic payments to the builder as construction progresses.
A legally binding document that states and explains a formal agreement between two entities, usually a buyer and seller, outlining the terms and conditions agreed upon between the two parties.
A person who is being provided products and services by the company.
Tailor-made or made to order according to the buyer’s / user’s needs.
A payment that not made immediately.
Actual pay-out of the financing amount to the customer.
That portion of a person’s income that is available for use after payment of taxes, food and basics, and other financial obligations.
An amount of money that is paid at the time of purchase, but which is a part of the total cost. The remaining amount is usually paid over a period of time.
The rate that the most creditworthy banks in the Emirates charge each other for financing. It is usually the base rate used by companies as a benchmark for calculating their profit rate.
Having the necessary qualities or fulfilling the necessary conditions.
Monthly installments that are of equal amounts, i.e. the amount to be paid each month will remain the same.
The value of a property after any mortgage or other charges relating to it have been paid in full.
LTV Ratio
LTV, short for Loan To Value, is a percentage value used to describe the percentage of loan granted by lending banks in the U.A.E.
Since, in principle, expat residents can borrow up to 80 % of the current market property value so LTV will be 80 % and local residents (Emarati citizens) can borrow up to 85 % so LTV will be 85 %.
LTV ratios for mortgage in Dubai vary because of different factors. Just ask one of Mortgage House mortgage advisor for more information on this.
Loan Term or Tenure
Loan term or Tenure is the length of duration, termed in months (300 months) or years (25 years), that loan will have to be paid back to the lender. For example, home loan in the U.A.E are, by default, paid back in 25 years or equivalent of 300 months to the lender. Month by month.
Loan terms or Tenure can be less. Loan terms are decided by the borrower. So, if you wish to reduce your tenure, you can. Simply ask a Mortgage House mortgage advisor for more information.