What do I need to know about this Islamic mortgage?
Alliance Bank i-Wish Home Financing-i is structured based on the Shariah principle of the Bai Bithaman Ajil (BBA) which is basically the sale of goods on a deferred payment basis. This Islamic home mortgage can be used to finance a residential property only, either completed or under construction.
You can also use i-Wish Home Financing-i to refinance your current home loan facility. Alliance Islamic Bank will be able to finance up to 90% of the property value.The Islamic home loan can be supplemented with a Cashline Facility-i up to 70%, the overdraft equivalent for Islamic banking.
How are my repayments on the home loan calculated?
According to Islamic banking, your monthly installments are calculated based on the Profit Rate at which the bank is entitled to be rewarded for lending you money. In practice, your profit rate is variable and determined by Islamic Base Rate (equivalent to conventional Base Rate) fluctuation.
The profit rate on this Islamic mortgage is also capped to a ceiling rate protect you from any steep increases in the IBR, that would result in higher interest rate charges.
Are there fees and charges to pay?
Your entry cost for obtaining this home financing-i has been made much less of a hassle with the bank waiving Setup, Processing and Monthly Maintenance Fees. If you're refinancing from a conventional home loan, you'll get a full waiver on the Stamp Duty.
Do I need a Takaful cover?
Taking up Mortgage Reducing Term Takaful (MRTT) is optional, but highly encouraged to potential homeowners if you ever find yourself in many situations where you cannot pay your monthly installments. Fire Takaful, however, is compulsory and is taken care of by the Islamic bank.
What's so great about i-Wish Home Financing-i?
- Save Costs - No Setup and Monthly Maintenance Fees to be paid, allowing you to allocate funds to other things!
- Lower Profit Rate - Helps you to hedge against a higher IBR, to minimise your repayments.
- Financial Security - A fixed monthly repayment scheme can be beneficial for those who prefer to allocate their finances elsewhere for other investments while paying a fixed amount on their mortgage without worry.
What are the documents needed when applying?
Salaried applicant:
- Copy of NRIC
- Latest 3-months salary slip
- Letter of Employment
- Sales & Purchase Agreement/ Booking receipt from developer
- Valuation report
- Copy of the Title Deed
Self-employed applicant:
- Copy of NRIC
- Latest 3-months salary slip
- Latest 6-months bank statement
- From 24 & 49
- Sales & Purchase Agreement/ Booking receipt from developer
- Valuation report
- Copy of the Title Deed
Am I qualified to apply for Alliance Bank home loan if I'm blacklisted?
Depending on your credit history with other financial institutions because all these information (outstanding credit card, personal loan, home loan or car loan debts) will be captured in CCRIS/ CTOS (a system that collect credit information on borrowers, not blacklisting them).
Assuming you have poor credit standing due to irregular payments, the best course of action would be to break the habit and start making your payments on time to avoid future hurdles.
Alliance Bank is more likely to approve your home loan application if you can show that you are managing your personal finances, rather than accumulating more debt.
