What is Property Equity?
Property equity is the difference between your property’s current market value and the remaining mortgage balance you owe to the bank.
In simple terms: Equity = Property Value – Outstanding Loan Amount
For example, if your home is worth AED 2 million and your remaining mortgage is AED 1.2 million, your equity is AED 800,000.
You can use this equity to raise additional funds through a “loan against property” or “equity release.”
Why Release Equity from Your Property?
Homeowners release equity for various financial goals, such as:
• Renovating or upgrading the property
• Paying for education or major expenses
• Investing in a new property or business
• Consolidating debts at a lower rate
Equity release allows you to access funds without selling your home making it one of the most flexible financing options available.
Steps to Get Equity Over Your Property
1. Know Your Property’s Current Value
Start by understanding how much your property is worth in today’s market.
You can request a valuation report through the mortgage advisor .
2. Review Your Outstanding Loan Balance
Check your latest loan statement to see how much you still owe.
Your available equity will depend on the difference between the property’s value and the remaining balance.
3. Consult a Mortgage Advisor
A mortgage advisor helps you explore which banks offer the best equity release or refinance options.
They can guide you through eligibility criteria, documentation, and potential loan-to-value (LTV) limits.
4. Apply for an Equity Release / Refinancing Loan
The process is similar to applying for a mortgage:
• Submit identification and income documents
• Provide your current property details
• Undergo a new valuation and credit assessment
Based on this, the bank will approve the amount you can borrow against your equity.
5. Receive the Funds
Once approved, the equity amount is disbursed to your account or used as per your request (for example, to fund a renovation or new property purchase).
Your existing loan may be adjusted, or a new mortgage account may be created depending on the structure chosen.
Important Things to Consider
• Banks usually allow equity release up to 75–80% of the property value.
• Your income and repayment capacity are key factors for approval.
• Refinancing or equity release may involve valuation and processing fees.
• Always compare rates and terms before finalizing.
Final Thoughts
Getting equity over your property is a smart financial move if planned carefully.
It helps you unlock the value of your home and put it to work whether for personal, investment, or business goals.
