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Personal Loan: Definition, Types, and How to Get One

Life has a way of throwing surprises our way—unexpected medical bills, spontaneous trips, or the need for a quick financial buffer.

In the United Arab Emirates (UAE), particularly in cities like Dubai, Abu Dhabi, Sharjah, and Ajman, a personal loan stands out as a useful financial tool. Let’s simplify the topic of personal loans by telling everything about personal loans there is to know.

Want to get personal loan in Dubai, UAE? Contact us now.

What is a Personal Loan?

A personal loan’s definition is that it is a financial lifeline with no need for collateral. Unlike other loans, this option in the UAE boasts simple eligibility criteria, tempting offers, and the freedom to use funds as needed. Whether you’re facing a medical emergency or dreaming of an exotic getaway, a personal loan provides the means to meet your goals.

Types of Personal Loans

In the UAE, personal loans come in different types, each tailored to specific needs:

Personal Loans for Expats: Designed for people who are not citizens of the UAE, they have attractive rates of interest.

Personal Loans for Non-Listed Companies: These loans, which are specifically created for professionals working in startups or privately held companies, acknowledge the particular difficulties that startups face.

Personal Loans without Salary Transfer: Some lenders do not need salary transfers to be eligible for a loan, which is advantageous for borrowers who want flexibility.

Personal Loans with Salary Transfer: These loans provide speedy approval but typically call for a salary account with the lending bank.

Personal Loan for UAE Nationals: These loans are for citizens to enjoy more favorable terms compared to foreigners.

Personal Loans for Self-employed Professionals: Entrepreneurs and self-employed individuals benefit from loans designed with their unique needs in mind.

How to Get a Personal Loan in the UAE

There is a simple procedure to get a personal loan in the UAE: After getting personal loan you should know how to use personal loan wisely in Dubai, UAE.

  1. Documents Required:
  • Complete the application form.
  • Present a valid Passport, Visa, and Emirates ID.
  • For foreigners, a valid UAE visa is mandatory.
  • Furnish bank statements covering the past 3 to 6 months.
  • While optional, a salary transfer letter can speed up the process.
  1. Eligibility Criteria:
  • Age: Between 21 to 65 years old.
  • Minimum Monthly Salary: AED 5000.
  • Employment History: Employment or a few months of service is typically required.
  • UAE Residency: Primarily for residents, though certain banks offer tailored options for expatriates.
  1. Features of a Personal Loan:
  • Loan amounts extend up to AED 4 million for UAE nationals and AED 2 million for expatriates.
  • Competitive interest rates commence at 2.7% p.a.
  • The maximum tenure spans up to 48 months.
  • The documentation process is simplified for quick approval.
  1. Interest Rates Explained:
  • Flat Interest: A fixed rate throughout the loan term, ranging from 2.63% to 22.22%.
  • Reducing Interest: Varies from 4.99% to 39.99%, decreasing with each installment.
  1. Interest Rate Calculation:
  • Divide the interest rate by the number of payments per year.
  • Multiply the result by the loan balance.
  • Subtract the calculated interest from the amount repaid for the remaining balance.

Read our new article how to choose the right personal loan in the UAE.

Selecting the right personal loan is important in the UAE’s constantly changing financial markets. For personalized assistance with understanding the choices that exist in Abu Dhabi, Dubai, Sharjah, Ajman, and other emirates, Gulf Financial Services offers expertise to secure the best personal loan that meets your specific needs. With us, you can apply for a personal loan easily.

By admin

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