A maximum of 10 thousand dirhams

Two bankers: 1% of the loan amount is deducted upon transfer of indebtedness before paying the first installment

Banks are trying to attract dealers by postponing the payment of the first installment of the loan for a period of up to three months.

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Two bankers said that if the customer moves from one bank to another before paying the first installment of his debt to the old bank, a fee of 1% of the loan value is required, with a maximum of 10,000 dirhams.

The two bankers explained to Emirates Today that transferring the customer's indebtedness is in his favor if the installment value is lower, meaning that the interest rate in the new bank is better than that imposed by his current bank, which means that he enjoys a respite from the debt burden for a period of two to three months. Besides reducing the amount of the monthly deduction from his income.

And «Emirates Today» had received questions about banks imposing 1% of the loan value when they early transfer their debts without paying any installments.

In detail, the banker, Mustafa Ahmed, said that banks are active in offering offers to purchase debts, especially large amounts, as they are well-studied loans by Alawwal Bank, indicating that, in return, the customer sometimes agrees to take advantage of the grace period granted to him before the first installment is due, which usually ranges between Between two to four months, as this period is considered a relief from the debt burden, and at other times the customer resorts to transferring his debt to obtain a better offer that includes a reduction in the value of the premium and a monthly deduction from his salary.

Ahmed added: “In both cases, the customer is a beneficiary of that, but there are customers who move between banks before the date of the first installment is due to take advantage of the grace periods, so the banks in this case apply the decision of the Central Bank, and impose a fee of 1% of the value of the loan, and a maximum of 10,000 dirhams, so the customer must pay attention to this, especially if the loan value is high.”

He pointed out the importance of the customer paying attention to the fact that some banks charge installments with additional unclear interest rates when the installments are postponed, whether at the beginning of taking the loan or during the years of payment, meaning that he should study the offer and make sure that there are no interests or exaggerated fees if he wishes to postpone the payment of the installment.

For his part, the banker Salam Omran said that the high interest rates as a result of raising the main interest made the competition between banks to buy the customer's debts more than before, in light of the somewhat reduced demand for taking new personal loans.

He mentioned that banks are trying to attract dealers by postponing the payment of the first installment for a period of up to three months, in addition to the existence of two deferments per year over the years of payment.

Omran added that the customer must be aware that transferring it between banks without settling a certain period, he will be charged a fee of 1% of the value of the loan or a maximum of 10,000 dirhams, indicating that this procedure is in accordance with the Central Bank system for personal loans.

He stressed the need for the customer to pay attention to fees, commissions, insurance and the percentage of payment he pays when transferring his debt, and to balance his current position in his old bank and what he will get if he moves to a new bank.

Hello Imran:

"The high interest rates made the competition between banks to buy debts more than before."

Mustafa Ahmad:

"Banks are active in making offers to buy debts, especially large amounts, as they are well studied."

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