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Murabaha   ("Cost-Plus Sale with Deferred Re-Payment")

(Murabaha Home Purchase Plans are currently only available for Buy to Let transactions and to non-UK residents)

Murabaha was first introduced in 1997 and is a simple method of financing the purchase of your house according to Islamic principles.

The procedure for buying a property using Manzil Murabaha Home Purchase Plans is very straightforward and although the documentation is different to normal mortgage documents the process is not normally more complicated or time consuming than buying a property in any other way. As with any mortgage, you must seek legal advice before completing the purchase.

The key features of Murabaha are described below.

You can

• Purchase either freehold or leasehold residential property in England and Wales.
• Obtain finance up to a maximum of 65% of the property value.
• Register the property in your name(s). Also available to Trusts, Corporates (offshore & onshore), and Partnerships.
• Purchase a property for letting purposes, ‘Buy to Let’ finance up to a maximum of 65% of the property’s value is available. Please visit the Buy to Let page for further details.
• Chose a payment term of between 5 and 15 years.
• Fully repay the Home Purchase Plan at anytime.

How it works

• You identify the property you wish to buy and agree the purchase price with the seller of the property in the normal way.
• You approach us for assistance and complete an application form (see section ‘Qualifying for Manzil’).
• If we are able to help, the bank will buy the property, after solicitors have confirmed that everything is in order, and immediately sell it to you at a higher price.
• The higher price is calculated depending on the value of the property, the number of years you wish to pay us over and the amount of your first payment (see ‘payment calculator’ for an indication of the higher price).
• When purchased, the property is registered in your name or in the name of a Trust, a Corporate (offshore & onshore), or a Partnership, and the sale between yourself and the bank is recorded in the Murabaha Contract.
• Your first payment to the bank is made on the day of completion and is your initial contribution, normally a minimum of 35% of the purchase price.
• Payments are fixed for the entire payment term.
• One month after completion your regular monthly payments will commence. These will be claimed by Direct Debit automatically from your normal bank account.

Qualifying for Manzil

A Manzil Murabaha Home Purchase Plan represents a long-term financial commitment and the legal contracts we ask you to sign should not be entered into unless you are sure that you understand what they mean and feel confident that you will be able to afford the monthly payments.

To help assess whether you can afford the financial commitment, we will ask you to complete a detailed application form which will give us information about yourself, your employment, your other financial commitments and the house you wish to purchase. We will ask you to submit the application form together with other information, such as bank statements, to help us assess your financial position.

Once we receive the completed application form we will ask for references from your employer or accountant (if self-employed), your bank, your current lender (if appropriate) and your landlord (if you are renting). We will also undertake a credit search on all applicants.

Based on the information we receive, we will normally help you with an amount of up to 2.5 times your gross annual salary plus one times any other salary if the application is in joint names.

Please see the linked page for our terms and conditions