Residents earning a salary of at least Dh15,000 a month can now check their home loan eligibility online, as a Dubai-based bank launched a fully digital pre-approval service on Thursday. The service helps expatriate residents determine their borrowing capacity before committing to purchasing property in Dubai and Abu Dhabi.

Mashreq’s browser-based home loan pre-approval allows salaried applicants to submit their details online and receive a verified pre-approval letter on the same day.

In an interview with Khaleej Times, Srinivasan Padmanabhan, Head of Mortgages at Mashreq, explained that a pre-approval is an “approval in principle” based on the customer’s income, obligations and profile.

“A final approval is offered once a specific property is selected and the bank completes the valuation and remaining checks,” he said.

When asked if a buyer could still be declined later, he said, “Yes, it’s possible to be declined at the final stage, especially if the customer’s financial situation changes in the interim or if any of the pre-approval criteria are not met.”

Pre-approval does not look at income alone. Padmanabhan said all liabilities reflected in a customer’s credit bureau report — including car loans, credit cards and other financial commitments — are considered, as they affect how much a borrower can sustainably repay each month.

Under Central Bank regulations, a customer’s total debt burden cannot exceed 50 per cent of their monthly income, including the home loan instalment being applied for. Typically, salaried expatriates buying their first home in the UAE can finance up to 80 per cent of the property value.

From a borrower’s perspective, he said, this approach is designed to prevent over-stretching and support long-term financial wellbeing.

Eligibility explained

Padmanabhan defined eligibility as what residents can afford to borrow from a bank to buy their own home. The bank’s pre-approval estimates a “responsible loan amount” that the customer can service month on month.

“A mortgage helps customers own their dream homes by paying a small portion upfront (also known as a down payment) and repaying the remainder through manageable monthly instalments,” he said. “For us, the aim is to give customers early clarity on a realistic budget range — so they can search for homes with complete confidence.”

Documents required

Unlike traditional mortgage processes that require multiple documents, the digital pre-approval process is designed to be completed fully online. Applicants are required to provide their Emirates ID, passport and IBAN to receive a verified pre-approval.

Padmanabhan said this ensures the pre-approval issued is one the bank will honour, rather than an indicative calculation based solely on declared information.

Once pre-approved, buyers can proceed to shortlist a property and sign the relevant sale document, commonly referred to as a memorandum of understanding (MOU). Property documents are then submitted to the bank for independent valuation and final approval.

Source: Khaleej Times