Refinance
When should I refinance my UAE mortgage?
You should consider refinancing your UAE mortgage when your fixed period is ending, your current rate is meaningfully above the market, or you want to release equity — provided the break-even point (total switching costs divided by your monthly saving) is comfortably shorter than your remaining loan term.
Common triggers to refinance
- Your fixed-rate period is ending and you'll otherwise revert to a higher variable rate
- Market rates have fallen meaningfully below your current rate
- You want to release equity for renovation, investment or other needs
- You want to consolidate other debt into a lower-cost mortgage
The break-even rule
Divide your total refinance costs by your expected monthly saving to get the number of months it takes to recover those costs. If that break-even point is well within your remaining term, refinancing is generally worthwhile. If you might sell or repay the property before then, it usually isn't.
Worked example
Say you have a AED 1,500,000 balance on a 20-year term at 4.99%, and a new bank offers 3.89% (Emirates NBD's indicative best rate). Your monthly payment falls from roughly AED 9,891 to AED 9,003 — a saving of about AED 888 a month. Total refinance costs, including the arrangement fee, valuation, release, re-registration and the capped settlement penalty, come to around AED 28,740 (see the full cost breakdown).
| Item | Amount |
|---|---|
| Total refinance costs (indicative) | AED 28,740 |
| Monthly saving from lower rate (4.99% to 3.89%) | AED 888 |
| Break-even point | 28,740 ÷ 888 ≈ 32 months |
With roughly 17 years remaining on the loan, a 32-month break-even is comfortably worthwhile — after that point, the saving is pure benefit for the rest of the term. Use a mortgage calculator to run your own numbers.
Do not refinance if...
- You plan to sell or fully repay the property before your break-even point
- The rate gap is small (under roughly 0.25%) and doesn't clear the switching costs within a reasonable time
- Your existing bank will match or beat the new offer through a simple rate switch at little or no cost
- You're close to your maximum age at maturity and a new, longer term would push repayments past retirement
When it might not be worth it
If you plan to sell the property or fully repay the loan before your break-even point, refinancing may cost more than it saves. Also factor in your existing bank's early settlement penalty, capped at 1% of the outstanding balance or AED 10,000, whichever is lower, as part of your total cost.
Next step
See our full guide on when to refinance in the UAE and a full cost breakdown before applying.
Run the numbers on your own case
Free Lenddoo tools and guides related to this article.
Last reviewed 19 June 2026