Only 30% of the permissible deduction percentage from the salary according to the “central” system
Two bankers: refusing to finance cars for retired citizens due to their bank obligations
Under normal circumstances, banks finance a car for a retired citizen up to the age of 65.
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Awatif Al-Harmoudi: “Raising the deduction rate to more than 30% of the retiree’s salary exposes the bank to an explicit violation and accountability by the Central Bank.”
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Two bankers said that banks’ refusal to finance cars for retired citizens is mainly due to the existence of other banking obligations on them, such as a personal loan or real estate financing that takes the permissible deduction share according to the Central Bank’s system, which should not exceed 30% of the retirement salary.
The two bankers explained to «Emirates Today» that, under normal circumstances, banks finance a car for a retired citizen up to the age of 65, with the same terms and profit rates, as long as he has a good credit rating and a retirement salary from which the car premium can be deducted, not exceeding, with all his other bank obligations, 30%.
This came in response to the complaints of retired citizens received by «Emirates Today» related to banks' reticence in approving car financing, as most applications are rejected.
finances
In detail, the banking expert, Awatef Al-Harmoudi, said that banks agree to grant the retired citizen financing of various kinds up to a certain age that varies from housing financing to personal financing to a car, but that is according to what is specified for banks by the Central Bank regulations that have been in place for years.
Al-Harmoudi explained that the “Central” system does not allow the bank to deduct more than 30% from the retirement salary for all obligations, and 50% if the citizen is at work and has not retired yet.
And it indicated that if the retired customer meets the conditions, he gets financing without reservations, but if he already has other obligations here, an additional financing request, such as buying a car, cannot be approved.
Al-Harmoudi added that although the right of banks to finance cars is guaranteed to some extent - as it remains mortgaged in favor of the financing bank until its full installments are paid - however, raising the deduction rate to more than 30% of the pensioner's salary exposes the bank to a clear violation and accountability by the Central Bank. .
main condition
In turn, banker Mustafa El-Gammal said that banks grant financing to the retiree if he is a citizen, as he is receiving a retirement salary, but they do not grant financing to non-citizens who have retired.
He added: «Nevertheless, there is a prerequisite, which is that the rate of deduction from the salary of a retired citizen does not exceed 30%, and this exposes many retirees to the rejection of their requests due to the presence of installments and other obligations, whether it is real estate financing or others that acquire the percentage determined by the Central Bank that must be It is deducted as a monthly deduction.
Al-Jamal explained, “Banks finance a car for a retired citizen up to the age of 65, but on the condition that his salary allows that, meaning that the total of his monthly obligations to all banks, in addition to the car premium to be financed, is only 30% of the retirement salary.”
He pointed out that the percentages of profits granted to the retiree do not differ from those who are at the head of his work, as well as the conditions with regard to credit assessment and others, and this is what the retired citizen must be made aware of by bank employees, indicating that the refusal is not because of the retirement salary, but rather because of the discount rate. current from it.
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