Here's a list of six valuable hints to help you achieve your savings objectives. Soon, you'll be able to afford your dream home. Because of the large down payment requirements, buying a property in Ajman may seem like a faraway dream for many residents. So, here's a list of six helpful hints to get you started on your savings journey. Soon, you'll be able to afford your dream home.
What Is The Minimum Down Payment?
On properties less than AED 5 million, UAE legislation demands a down payment of at least 15% of the property value for UAE nationals and a down payment of at least 20% for non-UAE nationals. Suppose the property is worth more than AED 5 million. In that case, the down payment rises to 30% and 35%, respectively, and 40% and 45% for UAE citizens and non-nationals, respectively, if it is your second home. Remember that in addition to the down payment, you'll have to pay around 7% of the property's worth upfront in additional buying charges, which will deplete your resources even more. In other words, that's much cash to be saved! So, if you're serious about purchasing your first or second home, you'll need a solid savings strategy.
Use A Mortgage Calculator To Calculate Your Down Payment
If you know how much you want to spend on a home, the first step is to determine how much of a down payment you will need to make. The mortgage calculator helps quickly calculate how much you would need to save for your down payment on a home. Enter the property price, and the online calculator will calculate how much you'll need to save.
Set A Savings Target
Once you know how much you will have to save, the next stage is sketching up a savings strategy based on how much you make, how much you can afford each month, and how quickly you want to attain your savings target.
If you want to attain your goal sooner, in the next three to five years, you will likely need to save more than if you intend to buy a house much further down the road. So, think about your objectives and how much you can save each month, and then stick to it.
Pay Off Your Debts
The greater your debt, the more difficult it is to save. Because if you have a credit card or loan obligations eating away at your monthly income, you'll have less money to save for your future house. Getting debt-free should be at the top of your priority list.
Create A Savings Account
If you don't already have one, now is the time to establish one. It's a simple step that will make all the difference in reaching your savings target. While interest rates on savings accounts in the UAE are often less than 1% (and hence not ideal for making the most out of your savings), it's an important step that will help you build a different pot from your everyday spending or even holiday savings account.
If your long-term objective is to save as much as possible each month, calculate your monthly costs vs. how much you need to spend each month to save. Enter the total cost of your rent, utilities, automobile, cell bills, and other regular outgoings into a simple spreadsheet or budget software. You'd be amazed how much just seeing and paying attention to your everyday outgoings makes you vigilant of overpaying - especially when you're aiming for a 15% or 20% down payment.
Downsize To A Less Expensive Apartment
Living in a place like Ajman Marina while attempting to save for a down payment may not be the most excellent way to save. Of course, we all want to live comfortably in a good apartment in a fantastic neighborhood. However, you may need to reevaluate and reprioritize when saving for a down payment. Moving into a more affordable apartment in a less expensive neighborhood will help you save for your dream house.
Once You've Secured Your Down Payment, It's Time To Be Pre-Approved
After you've worked hard to save all your hard-earned money for your down payment, the next step is to be pre-approved for a mortgage. To determine your mortgage eligibility, you can chat with one of the professional mortgage consultants at no cost. You may also get started online by answering personal questions about your income, liabilities, and savings. Consultants can evaluate whether you should qualify for pre-approval from a bank of your choice.