Islamic

Amanah Home Finance

Amanah Home Finance is based on the Diminishing Musharakah mode of financing and helps you buy your residential property without compromising your beliefs. If you already have a traditional interest based mortgage, the product allows you to refinance your property.

How it works

The Bank's interest will decline by the same proportion. The property will be leased to you for the financing term and you will pay rent.

You choose the property you want to buy and make an application. If you meet the criteria, financing will be agreed, then the following steps will take place:

Your solicitor or other legal adviser will be sent the legal documents, and will explain these to you.
If you then want to continue, you will be asked to sign the Amanah Home Finance letter. By doing this you will accept that the financing will be made available to you in accordance with the terms of the Amanah Home Finance letter. This means that the product terms and the obligation to enter into the associated documentation becomes binding at this time
Your solicitor or other legal adviser will make sure the title of the property is acceptable and approve the contract for the purchase of the property, ensuring that the contract to buy is capable of being transferred to us.
Contracts will be exchanged either with the person you are buying the property from, or you in the case of a refinance and a completion date agreed. This will be a binding contract for the purchase of the property. A date will be agreed for completion when the trust will be set up and the property leased to you.
At completion, the property will be held in trust by HSBC Trust Company for each of us in shares equal to our contribution to the purchase price, e.g. 10% for you if you have paid a 10% deposit and 90% for us if that is the amount of financing we have provided.
HSBC Trust Company as trustee will lease the property to you for the financing term. Our solicitor will register ownership of the property and the Trust Deed. Your solicitor or other legal adviser will register your ownership of tenancy in your name.

You'll need to make a monthly Amanah Home Finance payment to us for the term of your finance. The payments will be made on the 25th of every month, and will be collected from your account by Direct Debit. Your payment will comprise: rent, contribution payment and Charges, if applicable (any other sums payable for a leasehold property and buildings insurance if arranged by the bank).

For each monthly payment that you make you will pay the bank rent for the use of our share of the property and acquire an additional share for yourself. At the end of the agreed term, and when all payments have been made, you can exercise the promise to sell and we will transfer the property to you.

You can also purchase our interest in the property from us by exercising the promise to sell at anytime during the term of the finance.

Qualifying criteria

Suitable for those in permanent employment or the self-employed. UK national or foreign nationals with appropriate residency status.

Qualifying ages are 18-65 (70 ONLY with proof of income after retirement and at discretion ofApproval Manager – each case assessed on merit)

Credit check
Minimum deposit (10%)
Documentation required or information needed at hand for making an application are:

Proof of ID – Valid Passport
Proof of Address – Driving Licence withexisting address or a recently paid utility bill
Proof of Income – Last 3 months payslips orlast 3 years accounts arranged by a registered accountant
Proof of Affordability and Financial Competence – Last 3 months bankstatement.
Minimum deposit requirement
10% for mortgages up to £299,000

Qualifying Property & Value

Qualifying Properties:

Freehold Domestic Residential Properties in England and Wales.
Leasehold Domestic Residential Properties, including flats and maisonettes. With an unexpired lease term minimum 50 years plus the term of the tenancy (subject to landlord's consent if required, for us to let the property to you).

Non Qualifying Properties:

Commercial Properties.
Properties outside England & Wales.
Buy to let properties.
Shared ownership.

Please note: Any offer of finance on qualifying properties will be subject to status and a satisfactory valuer's report.

£25,000 is the minimum amount of finance available through Amanah Home Finance and your chosen property must be valued at £28,000 or more.

Payment terms

Up to 30 years, or the age of 70.

Income Multiplier

Applicants can make one application – i.e. potentially 6 incomes cantaken into account when assessing an application. Salary multiples are not used but affordability calculated using customersearnings and outgoings.

Shariah panel / advisors