Access to mortgages in Saudi Arabia has improved significantly in the last decade, becoming more structured, accessible, and transparent. Today, both citizens and expatriates have clearer pathways to property ownership, provided they meet the established real estate financing requirements in KSA.
As demand for residential properties in Riyadh, Jeddah, and the Eastern Province continues to rise, understanding the legal and financial framework is essential before starting any property purchase. This guide outlines how mortgages work in the Kingdom, eligibility rules, required documentation, and what buyers should expect throughout the process.
Key Mortgage Rules in Saudi Arabia
Saudi mortgage regulations are designed to support responsible borrowing while protecting both banks and homebuyers. These are the main rules shaping today’s mortgage environment:
1) Loan-to-Value (LTV) Limits
- Saudi citizens: Up to 85% LTV on residential properties
- First-time Saudi buyers (government-supported): May reach 90%–95%
- Expatriates: Typically 70%–80% depending on the bank and residency status
The remaining percentage becomes the required down payment.
2) Income-to-Installment Ratio
Monthly mortgage payments must not exceed 45% of the borrower’s monthly income.
Banks apply this limit strictly to ensure long-term payment stability.
3) Sharia-Compliant Financing Structure
Saudi mortgages follow Islamic finance principles. The two dominant models are:
- Murabaha: Bank buys the property and sells it to you at a marked-up price with fixed installments
- Ijara: Bank leases the property to you until final ownership transfer
These models eliminate interest (riba) and replace it with profit-based structures.
4) Property Eligibility Rules
The property must:
- be structurally sound
- meet municipal building codes
- have a valid title
- be located in an approved residential zone
Banks conduct their own valuation before approving financing.
Who Is Eligible for Mortgage Financing?
Eligibility depends on nationality, income stability, and financial history.
Eligibility for Saudi Citizens
- Age: 21–65 years
- Minimum income: generally 5,000 SAR / month
- Stable employment (private or government)
- Clean credit history with no major defaults
Citizens can also access government-backed financing through the Ministry of Housing and the Sakani Program, which expands mortgage options and reduces monthly burdens.
Eligibility for Expatriates
- Valid Iqama
- Minimum income (higher than Saudis): often 8,000–12,000 SAR / month
- Employment contract of at least 2 years remaining
- Down payment of 20%–30% minimum
Not all banks lend to expatriates, and some limit financing to specific developers or projects.
Eligibility for Foreign Investors (Non-residents)
The upcoming 2026 ownership framework will clarify rules for non-resident foreign buyers, but currently:
- special zones only
- additional documentation
- higher down payment
- case-by-case approval
Required Documents for Mortgage Approval
The real estate financing requirements in KSA include specific documents that verify identity, income, and the property itself.
Personal Documents
- National ID / Iqama
- Employment contract
- Salary certificate
- Bank statements (3–6 months)
- Credit report
Property Documents
- Initial sales agreement
- Property floorplans
- Municipal building permit
- Title deed (or proof of ownership transfer for off-plan units)
- Valuation report (bank-issued)
Banks may request additional documents depending on the loan amount and property type.
Mortgage Financing Process — Step by Step
1) Pre-Approval
The buyer submits income and credit information.
The bank gives a maximum financing limit based on income and LTV rules.
2) Property Selection
Buyers choose a unit that fits the pre-approved amount.
At this stage, RAKEZ helps clients compare units across different projects — particularly helpful in Riyadh and Jeddah, where options vary widely.
Explore active listings:
3) Bank Valuation
The bank assigns a valuer to assess the property.
Mortgage approval depends on the valuation matching the requested loan amount.
4) Final Approval
Loan terms, monthly installments, and financing model (Murabaha or Ijara) are finalized.
5) Down Payment + Contract Signing
The buyer pays the down payment; the bank and seller finalize contracts.
6) Ownership Transfer
The property is registered under the buyer in the Ministry of Justice system (Najiz).
In Ijara contracts, full ownership transfers upon final installment.
Fees and Costs Buyers Should Expect
In addition to the property price and down payment, buyers should account for:
- Property valuation: 1,000–3,000 SAR
- Admin/bank fees: 0.5% to 1% of loan amount
- Property tax (if applicable in future frameworks)
- Agent or service fees (varies by arrangement)
- Monthly maintenance if within a gated community
These costs should be calculated early to avoid surprises.
What Banks Look For Before Granting a Mortgage
Banks assess risk carefully. The strongest approval factors are:
- High credit score
- Steady job with reputable employer
- Low existing debt
- Reasonable debt-to-income ratio
- Property located in a high-demand district
- Developer reputation (for off-plan units)
Off-plan projects from strong developers also receive smoother financing approvals.
RAKEZ assists buyers by filtering projects with strong bank compatibility — increasing chances of fast approval.
How RAKEZ Guides Buyers Through the Mortgage Process
RAKEZ is a real estate marketing company, which means our role is not to sell you one product — it’s to help you navigate the entire market.
We support buyers through:
- identifying bank-friendly projects
- explaining the financial requirements clearly
- connecting you with developers that offer mortgage-ready units
- comparing home financing options
- preparing you with the documentation banks require
- offering market insight on prices, locations, and future appreciation
In a market as active as Saudi Arabia’s, professional guidance saves time, avoids missteps, and ensures buyers choose a property aligned with both budget and long-term goals.