The global economy may have slowed, but there is no stopping car manufacturers from producing new models that will excite not just new car buyers, but also tempt existing car owners to either get a second car or replace an old one.
Once you have found the car of your dreams — whether it's the latest model to come off an assembly line or a used car that still has the horsepower to take you to your next destination — the next step is to pay outright with cash or a check; but if you're not as lucky and loaded, taking out an auto loan should be the next item on your to- do list.
There is a variety of offers from different banks in the UAE, and your car dealer may have special arrangements with certain banks so you may want to check those out. But feel free to do your own search, so you can decide for yourself which one suits your budget best.
A few things to bear in mind — almost all banks in the UAE will require potential borrowers to be at least 21 years old at the time of loan application, and a maximum of 65 years of age upon loan repayment. Loans are offered to Emiratis and expatriates living in the UAE with valid residence visas. Some banks offer different loan packages for Emiratis and expatriates.
Minimum salary requirement for an auto loan is Dh5,000 per month. Noor Islamic Bank asks for Dh5,000 per month, whereas Sharjah Islamic Bank's auto loan eligibility requirement is a minimum of Dh12,000 per month. National Abu Dhabi Bank is somewhere in between, and asks for a minimum salary of Dh7,000 per month for an auto loan.
At the time of loan application, most banks will require salaried expatriates to have been working for their employers for at least six months, and at least three months for UAE nationals.
Companies wishing to obtain a vehicle for company use may also obtain an auto loan, provided they have been in business for at least 24 months and have an annual turnover of at least Dh50,000. Fleet purchases may likewise be arranged for certain companies with multi-vehicle requirements.
If you are eligible, the next things to sort out are the documents required by banks. Documentations vary depending on the vehicle you wish to purchase — i.e. whether you intend to buy a new car or a used vehicle.
The most common requirements for new vehicles are: a valid salary certificate, authenticated copy of passport (with the residence visa page, for expatriates; and the last page, for UAE nationals), the quotation from the car dealership stating the price of the vehicle, three months' worth of bank statements, and a copy of a valid UAE driver's licence.
Some banks may also ask you for a copy of a proof of residence such as your DEWA (Dubai Electricity and Water Authority) bill or tenancy contract.
And make sure you are able to issue post-dated cheques to cover the loan amount. If you don't have a current account, some banks will also arrange to open one for you, complete with cheque book and ATM facilities that can be used to pay your EMI (Equated Monthly Instalments).
For used cars, the additional documents required are: a valuation certification indicating the amount of the used vehicle and an ownership title and car sale agreement.
Most banks have their representatives available at the auto showroom itself. For example, the Nissan showroom has a dedicated cubicle for a Standard Chartered bank's representative.
If you feel there is an information overload here, simply drop in at any car showroom and check for yourself — they have helpful and efficient customer care and sales representatives to help buyers with all they need to know.