A Guide to Car Finance in The UAE

If you’re planning to buy a car in the UAE, it’s highly likely that you will need to arrange some level of finance. Cash buys for higher-end luxury vehicles like Lexus are less common, even on pre-owned vehicles. So regardless of whether you sell your vehicle and put the cash towards your new model, you will need to take out a certain amount of finance. Here is a brief guide to car finance in the UAE.

What documentation do you need?

To buy a car in the UAE on finance, you will need several official documents. These not only confirm your identity and your citizenship, but will give the finance provider proof that you have the funds to maintain your repayments. The documents you need include:

• Your Emirates ID card – this is an absolute requirement and a finance deal cannot be secured without an ID card being shown. If you are renewing your card and are still waiting to receive a new ID card, you must wait until you’ve received it to start the process of applying for finance.
• Your passport
• A salary certificate
• A full driver’s licence
• 3-6 months of bank statements
• The car’s registration, valuation certificate and insurance documents.

Other requirements

To apply for car finance in the UAE you will need to be at least 21 years old. Your salary also has to be sufficient to meet the requirements of the loan provider, and most importantly demonstrate that you have sufficient funds to maintain your monthly repayments. Bear in mind that if you do find a provider offering a 0% interest loan for the first part of the agreement that your finances need to be healthy enough to maintain your repayments once the interest charges do start to kick in.

Loan periods

Generally, finance providers will grant loans for both new and pre-owned cars for a maximum period of 60 months. However, you will need to speak to your dealer as for pre-owned cars this period may be shorter and you may have to pay the full amount back within a much shorter time of between 24 and 48 months.

How much deposit do you require?

Lenders will provide a maximum of up to 80% of a car’s value. However, this will depend on whether the vehicle is new or pre-owned. You will need to provide a deposit of 20% of the car’s value in advance. Many lenders will also stipulate a minimum amount that they will finance, which is normally around AED 20,000. Taking into account that this represents only 80% of the value of the vehicle, it means that the vehicle must have a minimum value of around AED 25,000 to qualify for financing.

Who handles the paperwork?

The easiest way to arrange car finance in the UAE is to talk to a dealership. Not only are they experienced in submitting and arranging finance, but they often have a close relationship with the finance provider, making it much easier to apply via a dealership.

At Al-Futtaim Lexus, we recognise that the vehicles we sell are luxury, high-status and highly aspirational cars. So we provide exclusive Lexus finance deals for our customers whether they’re looking for a new or pre-owned vehicle. We also provide some alternatives to make it easier for you to own the car of your dreams.

Lexus Solutions
Lexus Solutions is a finance option with a guaranteed future value, where we guarantee to buy back your vehicle at the end of the term at an agreed price. That means you can either:

Renew – take the guaranteed buy-back amount and put it towards a new Lexus. Perhaps that NX you’ve always wanted.

Retain – pay off the remaining balance and keep your car either as a final cash settlement or through refinancing.

Return – as long as your vehicle meets the fair wear and tear considerations and the agreed mileage, you’ll be paid the GFV direct into your bank account.

To find out more about Lexus Solutions, and our Lexus Leasing and Lexus Hire Purchase schemes, contact us today and talk to one of our car finance professional advisors.