Mortgage buyout: moving to another bank
Two similar situations. In the first, you already have a mortgage and want to move to a bank with better terms. In the second, you are buying a property the seller still has a mortgage on, and you finance it with another bank. Either way, the new bank settles the old loan and the property moves under the new mortgage.
Who it is for
- You have a mortgage and another bank offers better terms
- You are buying a resale property that still has a mortgage on it
- You need to change bank and restructure the term or payment
How it works
- 01
Pre-approval with the new bank
We submit your documents and get a pre-approval. The bank looks at income, credit history and existing debt.
- 02
Liability letter from the current bank
The existing bank issues a letter with the exact amount owed on the settlement date, including any early settlement fee.
- 03
Valuation
The new bank orders a valuation, which caps the loan amount. If it comes in low, the gap is covered with your own funds.
- 04
Settlement and new mortgage
The new bank issues a manager's cheque to the old bank. The old bank releases the mortgage, and the new bank registers its own with DLD.
What to watch
- Early settlement fee at your current bank. The amount is set out in your loan agreement.
- Switching costs: new mortgage registration, valuation and bank fees. Work them out upfront so the rate saving actually covers them.
- Timing: a liability letter is valid for a limited period. If the deal drags on, it has to be reissued.
Documents
- Passport, UAE visa and Emirates ID
- Proof of income (salary certificate or company documents)
- Bank statements for 6 months
- Liability letter and current mortgage statement
- Title Deed
The bank may ask for other documents too.
From practice
My first mortgage-to-mortgage deal, 2024
I closed my first deal of this kind in 2024, and another one is in progress now. Details will follow in the case studies section.
This information is for guidance only. Final mortgage terms are set by the bank after reviewing your documents.
Other scenarios
- 01Final 20/80, 40/60 paymentFinance the final payment to the developer at handover
- 02Instalments and penalties → NOCThe buyer's mortgage clears the developer balance and penalties so the NOC can be issued
- 03Non-residentsTerms for non-residents, and how a UAE job changes them
- 04Equity releaseBorrow against your property, even if it is already mortgaged