UAE central bank agrees on mortgage caps - report

Initial proposal to set maximum limit on property loans is agreed

NEWS, Business, Mortgage law, Uae

The United Arab Emirates central bank has given initial approval to a proposal by the country's commercial banks on setting limits for residential mortgage loans, Al Khaleej newspaper quoted an unnamed banking source as saying on Thursday.

"The central bank informed banks of its initial approval during a large-scale meeting with chief executives in Abu Dhabi that went on for nearly three hours," the paper quoted the source as saying.

"The [central bank] seeks the public interest and will complete the draft law soon."

Last month, the local banking association proposed that lending for first homes be capped at 80 percent of the home's value for UAE nationals and 75 percent for expatriates. Ratios for subsequent homes would be 65 percent for UAE nationals and 60 percent for expatriates.

Central bank officials could not immediately be contacted for comment on the newspaper report.

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