8 Common Mistakes to Avoid During a Property Mortgage Transfer
Thinking about a property mortgage transfer in the UAE? Maybe you’ve spotted a better interest rate or want to take advantage of attractive mortgage transfer deals. Switching your home loan can be a smart move — but only if you get it right.
From hidden fees to documentation mess-ups, these mistakes can cost you time and money. With mortgage loans in the UAE reaching well over AED 1.26 million total outstanding recently.
Let’s dive into the eight common mis-steps you must avoid when doing a mortgage transfer UAE, so you stay on top of your game.
Mistake 1 - Neglecting the Impact of Fees
One of the biggest traps is underestimating the mortgage transfer fee. When you move your loan to a new lender or shift your financing, banks or the land registry may charge transfer, processing, or administrative fees.
For example, some banks quote a special package when you do a mortgage transfer to another bank, but don’t forget to check all hidden fees. If you overlook the fee-side, the marginal rate benefit could vanish. Always ask for a detailed breakdown: transfer fee, valuation fee, early settlement penalty, etc.
Mistake 2 - Ignoring the Fine Print from Specific Banks
Some banks may advertise great terms for a mortgage transfer but their fine print hides caveats. For example, Emirates NBD mentions “switch your home loan to us and benefit from low interest rates” but you’ll still want to check the exact figure and whether there’s a specific “change mortgage transfer fee” or penalty for switching.
Emirates NBD Failing to scrutinise terms such as salary transfer requirements, minimum tenure, or a lock-in period is a mistake many borrowers make.
Mistake 3 - Overlooking the Value of Your Current Deal
Before you jump into a new deal, consider your current loan: Are you locked into a good rate? Could staying put be cheaper? When you initiate a property mortgage transfer, you often trigger a fresh loan agreement — which means you may pay valuation, registration, and transfer fees, and maybe higher upfront costs.
Evaluate the total cost: the new interest rate + fees + your remaining tenure vs your current rate. Ignoring this calculation is a common error.
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Mistake 4 - Not Requesting or Understanding the Formal Mortgage Transfer Letter
Whenever you’re moving a loan or changing lenders, you’ll typically need a mortgage transfer letter (or bank’s approval letter) stating that the new lender agrees to take over, and the previous lender consents to release its mortgage claim.
Missing this letter or failing to ensure it meets all requirements (such as naming parties, property details, outstanding amount) can lead to delays or legal issues. Make sure the letter addresses the transfer of rights, ownership or obligations as appropriate.
Mistake 5 - Mis-handling the Mortgage Transfer of Ownership
Sometimes the loan transfer is accompanied by a change in ownership (for example co-owner changes or transferring from individual to company). If you’re doing a mortgage transfer of ownership, you must ensure the legal process (including title deed changes via the relevant land department) is properly executed.
Failing to manage ownership transfer correctly while shifting the loan is a recipe for complications — like your property being still encumbered with old mortgage terms or ownership mismatch at registration.
Mistake 6 - Chasing a Deal Without Aligning Timelines
When you spot one of the attractive mortgage transfer deals, it’s tempting to act fast. However, the timeline matters.You’ll need valuation, credit approval, payout to the old lender, registration with the land department, etc. Delays in any of these steps could result in missing the deal. Other than that you can get a cutoff or incurring extra interest or fee.
Also, factoring in whether you’ll transfer via mortgage transfer to another bank means your salary may need to be transferred, or other eligibility criteria need to be met. Don’t let urgency compromise your preparation.
Mistake 7 - Failing to Account for Market & Interest-Rate Movements
Just because a deal looks good today doesn’t guarantee it stays that way. Especially in the UAE, interest-rate cycles matter. In 2024, the mortgage market saw financing levels of up to 85% of property value in many banks.
But rates move, and your new lender may revise terms. If you rush a mortgage transfer, you may lock into a slightly worse deal than if you’d waited or compared more output. Always compare not just headline rates but also what happens over the next 3-5 years.
Mistake 8 - Skipping Due-Diligence on the Property Itself or the Loan Balance
When you engage in a mortgage transfer UAE, you must check the property’s status (title deed, existing encumbrances, service charges) and your existing loan balance (early settlement charges, maturity, interest rate reset).
If the property has unresolved service-charge arrears or regulatory issues, the bank may refuse the transfer. Also if your current lender has an early settlement penalty, the cost of payoff may curb your benefit. Skipping this due-diligence is a frequent mistake.
FAQs
What does it mean to transfer a mortgage?
When you move a home loan from one bank to another or change the terms of the loan with a different lender, this is called a mortgage transfer. In other words, you are changing how you are paying for your property.
When would it be a good idea to move your mortgage to a different bank?
It might make sense to switch lenders if your current interest rate is high, a new lender offers a much better rate, or you need to change the terms of your loan (for example, by changing the length of the loan, the amount of the loan, or the salary transfer). You should, however, figure out the total cost, including fees.
What kinds of costs should I plan for when I transfer my mortgage?
You should plan for the fees for transferring the mortgage, getting the property appraised, registering with the land department, paying off your current loan early, and maybe even paying for legal or documentation fees.
Is there a special fee for switching to Emirates NBD?
Emirates NBD advertises competitive options for switching home loans, but you should look for a “change mortgage transfer fee” that is only for switching banks or lenders. Always check the Key Facts Statement for a full list of fees.
What is a mortgage transfer letter, and why do I need one?
The mortgage transfer letter is an official letter from your old lender (and/or new lender) that says the mortgage can be released and confirms the new mortgage deal. It makes sure that the transfer is legal and that the title deed shows the right mortgage.
How is a mortgage transfer of ownership different from a regular loan transfer?
When you transfer a mortgage, you not only move the loan, but you also change who legally owns the property. For example, you could add a co-owner or move the property into a company’s name. This adds more legal steps and could change your eligibility for a mortgage or the terms of your loan.
Are there any special mortgage transfer deals in the UAE that I should be aware of?
Yes, banks often offer mortgage transfer deals that include no processing fees or lower rates for customers who move their salary to that bank. But make sure to read the fine print and compare the total costs.
Is it possible for all expats in the UAE to switch their mortgage?
Most expats can apply, but their salary, credit history, and type of property will matter. Your current bank, the property’s value, your outstanding balance, and your residency status may all affect your eligibility for a switch.
How long does it usually take to transfer a mortgage on a property?
It depends on how ready the documents are, how much the property is worth, whether the credit is approved, and whether the land department has registered the property. It usually takes a few weeks, but it can take 4 to 8 weeks. Unexpected delays happen if documents are missing or property has encumbrances.
Will a mortgage transfer always lower my monthly payment?
Not all the time. You might get a lower interest rate, but the extra fees, early settlement charges, and longer loan term could cancel out any savings. Always think through the whole situation before making a choice.
Conclusion
A mortgage transfer or property mortgage transfer in the UAE can be a strategic way to reduce your cost or adjust your loan structure — but only if done with clarity and care. By avoiding the eight mistakes above, you’ll be well-positioned to take advantage of mortgage transfer deals, minimize the mortgage transfer fee, and ensure everything from the mortgage transfer letter to ownership changes lines up.
Always ask questions, compare lenders (including the likes of Emirates NBD when switching), and keep your paperwork tight. Your home loan is one of your biggest financial commitments — treat the transfer process like a proper transaction, not just a quick switch.
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