1. What is the Loan Percentage Calculator?

The Loan Percentage Calculator helps determine what percentage of your income is dedicated to loan repayment. This is particularly important in the UAE financial market to assess debt burden and financial health.

2. How Does the Calculator Work?

The calculator uses the simple formula:

Where:

• \( Loan \) — Total loan amount in AED
• \( Income \) — Total income amount in AED

Explanation: This calculation shows what portion of your income is allocated to debt repayment, which is a key metric for financial planning.

3. Importance of Loan Percentage Calculation

Details: Calculating your loan-to-income ratio is crucial for maintaining healthy finances, qualifying for additional credit, and ensuring you don't become over-leveraged according to UAE financial regulations.

4. Using the Calculator

Tips: Enter your total loan amount and income in AED. Both values must be positive numbers, with income greater than zero for accurate calculation.

5. Frequently Asked Questions (FAQ)

Q1: What is a healthy loan-to-income percentage in the UAE?
A: Most UAE financial institutions recommend keeping your total debt payments below 40-50% of your monthly income.

Q2: Should I include all loans in this calculation?
A: Yes, for an accurate financial picture, include all outstanding loans including personal loans, car loans, and mortgage payments.

Q3: Does this calculator work for monthly or yearly amounts?
A: You can use either, but be consistent. If using monthly loan payments, compare against monthly income. For annual figures, use annual amounts.

Q4: How does this affect my credit score in the UAE?
A: A high loan-to-income ratio may negatively impact your credit score and ability to obtain additional financing.

Q5: Are there UAE-specific regulations about loan percentages?
A: Yes, the UAE Central Bank has regulations limiting personal loan amounts based on income, typically not exceeding 20 times your monthly salary for UAE nationals and 15 times for expatriates.