FAB Buyout Loan — Transfer Debt from Another Bank
You have a personal loan with another bank. The rate is too high. The monthly payment is eating your salary. You want to move it to FAB — but you’re not sure if it’s worth the hassle or if you even qualify.
Here’s the honest answer: a FAB Buyout Loan can save you real money, but only if you understand the fees, the timing, and the requirements. This guide gives you the exact numbers FAB uses — rates, limits, documents, and the early settlement fee you’ll pay to your current bank — so you can decide if switching makes sense.
Safety Note: UAEfinbiz is an informational guide only and does not have access to your FAB account or personal information. Never share your Emirates ID, salary certificate, bank statements, or OTP with any third-party website or individual claiming to process loans. Always apply directly through official FAB channels. For verified information, visit the official FAB website at www.bankfab.com. Verify all terms, rates, and fees directly with FAB before signing any agreement.
What Is a FAB Buyout Loan?
A FAB Buyout Loan is a personal loan that FAB uses to pay off your existing loan or credit card debt from another bank. Instead of paying two banks, you pay only FAB. The goal is usually to get a lower interest rate, reduce your monthly payment, or consolidate multiple debts into one.
How it works:
- You apply for a FAB Buyout Loan
- FAB pays off your existing bank directly
- You repay FAB instead — at FAB’s rates and terms
- Your old bank closes your account
The key benefit: FAB’s rates are often lower than what you’re paying now. If you’re paying 15% with another bank and FAB offers you 5.44%, you save money every month.
FAB Buyout Loan Rates and Limits
FAB Buyout Loans follow the same structure as FAB’s standard personal loans.
What this means in practice: If you’re a UAE National with a AED 200,000 loan at 15% with another bank, moving to FAB at 4.70% could cut your monthly payment by hundreds of dirhams. Over 48 months, the savings add up to thousands.
Eligibility — What You Need to Qualify
FAB is clear about who qualifies for a Buyout Loan :
- Minimum monthly salary: AED 7,000
- Age: 21 years or older
- Employment: Governmental, semi-governmental, or legitimate private organization
- Service: Minimum 6 months with your current employer, or confirmed in employment
- Salary transfer: Required to a FAB account
Important: Your existing loan must be with another bank or finance company. FAB Buyout Loans are specifically for transferring debt from elsewhere.
Documents Required
The document list is similar to FAB’s standard personal loan, with one addition — the liability letter from your current bank :
- Liability letter or clearance letter from your existing bank (showing the outstanding balance)
- Copy of valid passport, residence visa, and Emirates ID (originals must also be presented)
- Salary transfer letter or salary certificate addressed to FAB
- Bank statements for the last 3 months showing salary credits (if salary is not already with FAB)
- Signed and completed application form
The liability letter is the key document. Your current bank issues it, confirming exactly how much you owe and the terms of your existing loan.
The Early Settlement Fee You’ll Pay to Your Old Bank
Before FAB pays off your old loan, your old bank will charge an early settlement fee. This is regulated by the Central Bank of the UAE :
- Maximum fee: 1% of the outstanding balance, capped at AED 10,000
Example: If you owe AED 150,000 to your old bank, the early settlement fee cannot exceed AED 1,500. The actual fee depends on your contract with that bank.
FAB handles this payment as part of the buyout process. The fee is deducted from the amount FAB pays to your old bank. You don’t pay it out of pocket separately — it’s built into the transaction.
How the Buyout Process Works
Step 1: Apply with FAB
Submit your application and documents, including the liability letter from your current bank.
Step 2: Get FAB’s approval
FAB reviews your application and gives you an offer — rate, amount, and tenure.
Step 3: FAB pays your old bank
Once you accept the offer, FAB transfers the outstanding balance (minus the early settlement fee) to your old bank.
Step 4: Your old bank closes your account
Your existing loan is settled. You now owe FAB instead.
Step 5: You repay FAB
Your monthly installments go to FAB at the new rate and tenure.
The entire process usually takes 1-2 weeks, depending on how quickly your old bank issues the liability letter.
What to Watch Out For
The early settlement fee reduces your savings. If you owe a large amount, the 1% fee (capped at AED 10,000) eats into your savings. Calculate the break-even point before switching.
Your old bank may delay the liability letter. Some banks take their time issuing it. Follow up persistently.
Your new tenure might be longer. If you extend the loan to 48 months at a lower rate, your monthly payment drops — but you might pay more total interest over time. Compare total cost, not just monthly payment.
FAB’s buyout offer depends on your profile. The advertised 4.70% rate is for UAE Nationals with strong profiles. Your actual rate depends on your salary, employer, and credit score.
Frequently Asked Questions
What is a FAB Buyout Loan?
A FAB Buyout Loan is a personal loan that FAB uses to pay off your existing loan or credit card debt from another bank. You then repay FAB instead, usually at a lower interest rate.
What are the interest rates for FAB Buyout Loans?
Rates start from 4.70% fixed per year for UAE Nationals and 5.44% fixed per year for Expats. Your actual rate depends on your salary, employer, and credit profile.
How much can I borrow with a FAB Buyout Loan?
Up to AED 5 million for UAE Nationals and up to AED 2 million for Expats, with a maximum tenure of 48 months (60 months for Ministry of Defence employees).
What documents do I need for a FAB Buyout Loan?
You need a liability letter or clearance letter from your existing bank, valid passport and Emirates ID, salary transfer letter, bank statements for the last 3 months, and a signed application form.
How much is the early settlement fee?
The Central Bank caps early settlement fees at 1% of the outstanding balance or AED 10,000, whichever is less. Your old bank charges this fee, and FAB deducts it from the buyout amount.
Does FAB require salary transfer for a Buyout Loan?
Yes. Salary transfer to a FAB account is required for the Buyout Loan.
How long does the buyout process take?
Usually 1-2 weeks, depending on how quickly your old bank issues the liability letter and processes the settlement.
Can I buyout a credit card debt with FAB?
Yes. FAB Buyout Loans can be used to pay off credit card balances from other banks, consolidating them into a lower-rate personal loan.
