K|Wise · Glossary
Drawdown
The point at which the lender releases the mortgage funds — typically paid directly to the seller at the Land Department on transfer day.
In plain English
The point at which the lender releases the mortgage funds — typically paid directly to the seller at the Land Department on transfer day.
What Drawdown means in practice
Drawdown is the moment the loan stops being an approval and becomes a debt. Until funds are released you owe the bank nothing; from drawdown, interest begins to accrue and your repayment schedule starts.
The money does not usually pass through your account. The lender issues a manager's cheque or transfer made out to the seller, handed over as part of the transfer itself.
How it works in the UAE
On a completed UAE property, drawdown happens at the trustee office on transfer day, simultaneously with the title transfer and the registration of the bank's charge over the property. On off-plan purchases the release is staged against construction milestones, with the final tranche paid at handover.
A worked example
A buyer approved for AED 1,600,000 sees nothing in their own account: the bank issues the cheque to the seller at the trustee office, the title deed is reissued in the buyer's name, and the first instalment falls due roughly a month later.
Terms that come up alongside Drawdown
Handover
The point at which an off-plan property is completed and the keys are transferred to the buyer. Final mortgage drawdown on off-plan units typically occurs at handover.
Read the definitionOff-plan
A property purchased before construction is complete. Off-plan purchases are typically paid in instalments tied to construction milestones, with final drawdown at handover.
Read the definitionAmortisation
The gradual repayment of a mortgage loan through scheduled monthly instalments of principal and interest. In the early years more of each payment goes to interest; in the later years more goes to principal.
Read the definitionBuy-to-Let Mortgage
A mortgage used to purchase a property that will be rented out rather than occupied by the borrower. Lenders assess the deal on projected rental income alongside the borrower's personal income.
Read the definitionCap
A contractual maximum on how much your variable mortgage rate can rise over a defined period. A common UAE structure caps the rate at 5.99% for the first 3 years.
Read the definitionConveyancing
The legal process of transferring property ownership from seller to buyer, including title checks, NOC issuance, mortgage registration, and the final Land Department transfer.
Read the definition