Ajman has quickly become a desirable destination for property investors and end-users alike, thanks to its affordable prices and improved infrastructure. But once you’ve decided to buy, the next big question is, how will you finance the property?
In the UAE—and especially in Ajman—buyers typically choose between mortgage financing through banks or developer payment plans. Each has its advantages, risks, and ideal use cases. This guide breaks them down in a simple, smart way so you can choose what best suits your needs.
Understanding Mortgage Financing in Ajman
What Is a Mortgage?
A mortgage is a long-term loan provided by a bank or financial institution, allowing you to purchase property by paying a portion (usually 20-25%) upfront and repaying the rest over time, often up to 25 years.
How Mortgages Work in Ajman
- Down Payment: 20-25% (as mandated by the UAE Central Bank for expats)
- Tenure: Up to 25 years
- Interest Type: Fixed or reducing
- Eligible Properties: Freehold or ready properties
💡 For more details on the mortgage process, visit: Mortgage Application Requirements for UAE Banks
Advantages of Mortgage Financing
- Ownership Security: Immediate legal ownership upon purchase.
- Structured Repayment: Predictable monthly installments aid in financial planning.
- Potential Tax Benefits: Interest payments might be tax-deductible, depending on the jurisdiction.
- Building Credit History: Regular repayments can enhance credit scores.
Considerations and Challenges
- Eligibility Criteria: Stringent requirements may limit accessibility for some buyers.
- Interest Accumulation: Over time, interest payments can significantly increase the total repayment amount.
- Early Repayment Penalties: Some banks impose fees for settling the mortgage ahead of schedule.
Learn more about mortgage options: Mortgage Options for Freehold Properties in Ajman
Developer Financing: Flexible Yet Risky?
What Is Developer Financing?
Developer payment plans are installment-based financing structures offered directly by property developers. They are popular for off-plan properties but can also be found for ready units.
Common Developer Payment Plans in Ajman
- 10/90 Plan: 10% down payment with the remaining 90% spread over a specified period.
- Post-Handover Plans: A portion is paid during construction, with the balance settled after property handover.
- Monthly Installments: Fixed monthly payments over a set duration, sometimes extending beyond project completion.
For instance, the Ajman One Phase 2 project offers a flexible payment plan starting with just a 5% booking fee and 1% monthly installments over seven years. Learn more about this opportunity: Ajman One Phase 2 Payment Plan.
Advantages of Developer Financing
- Lower Entry Barrier: Smaller initial payments make property ownership more accessible.
- Flexible Terms: Customized payment schedules to suit individual financial situations.
- No Bank Involvement: Simplified process without the need for bank approvals or credit checks.
Considerations and Challenges
- Ownership Transfer Delays: Legal ownership is often transferred only after full payment.
- Potential Project Delays: Reliance on the developer’s timeline can pose risks.
- Limited Regulation: Less oversight compared to bank-regulated mortgages.
Mortgage vs Developer Financing: A Side-by-Side Comparison
| Feature | Mortgage Financing | Developer Financing |
| Approval Process | Bank approval, documentation required | Direct from the developer, easier approval |
| Interest | Yes (fixed or reducing) | Often 0% during construction |
| Down Payment | 20-25% minimum | Can be as low as 5-10% |
| Term Length | Up to 25 years | Shorter (2-7 years), sometimes longer |
| Risk | Low (regulated by banks) | Moderate to high (developer-dependent) |
| Eligibility | Salary-based, documents needed | Flexible, especially for off-plan properties |
| Best For | Ready properties, long-term buyers | Off-plan buyers, investors needing flexibility |
Which Option Is Best for You?
Consider a Mortgage if:
- You’re buying a ready property
- You have stable income and want long-term financing
- You prefer a regulated, predictable system
Consider Developer Financing if:
- You’re investing in off-plan property
- You need a lower upfront payment
- You prefer flexibility in repayment and don’t qualify for a mortgage
Special Considerations in Ajman
Ajman’s property market is more affordable than Dubai or Abu Dhabi, which makes it easier to secure a mortgage with lower salary requirements. At the same time, developers in Ajman are increasingly offering aggressive zero-interest post-handover payment plans to attract buyers.
So the decision really depends on your financial situation, property type, and how much risk you’re willing to take.
Case Study: Mohammed vs Ayesha
Let’s look at two example scenarios that reflect the choices many buyers make based on their unique financial profiles:
▶ Mohammed, an expatriate with a stable monthly income of AED 15,000, opted for a bank mortgage to purchase a ready apartment in Ajman. He selected a fixed interest plan and paid 25% as a down payment. His steady job and strong credit made him eligible for bank financing, and he preferred predictable monthly payments over time.
▶ Ayesha, a freelance graphic designer with variable income, didn’t meet mortgage eligibility requirements. Instead, she purchased an off-plan property with a developer’s 10/90 payment plan, allowing her to make smaller monthly payments, even two years post-handover. This gave her ownership flexibility without requiring bank approval.
Both made smart decisions based on their circumstances.
Note: The scenarios above are fictional and intended to illustrate common financing decisions in Ajman’s real estate market.
Final Thoughts: Choose What Suits You
There’s no one-size-fits-all answer. But by understanding your options, evaluating the pros and cons, and getting expert guidance, you can make a confident, informed decision when buying property in Ajman.
Need expert help with financing your next property in Ajman?
👉 Contact Improperties – Your Trusted Real Estate Advisors
Note: The information provided in this guide is for informational purposes only and should not be considered financial advice. Always consult with a financial advisor or real estate expert before making investment decisions.
FAQs
Can expats get a mortgage in Ajman?
Yes, expats can apply for mortgages on freehold properties from UAE banks, provided they meet income and documentation requirements.
Is developer financing available for ready properties?
Yes, but it’s more common for off-plan units. Some developers may offer post-handover payment plans for ready projects, too.
What’s the minimum salary for getting a mortgage in Ajman?
It varies by bank but typically starts from AED 10,000/month for expats.
Which is safer: mortgage or developer financing?
Mortgages are generally safer due to bank regulations. Developer financing has higher risk, especially in the case of project delays.
Can I switch from a developer plan to a mortgage later?
Yes, in some cases. Once the property is ready, you can opt for a mortgage to clear remaining dues and enjoy a longer tenure.
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