What do I need to know about Bank Muamalat Home Financing-i?
Home Financing-i from Bank Muamalat is a Shariah compliant home loan that operates much like a conventional mortgage: the loan principal is repaid with with fixed monthly installments.
To help you manage your budget, you can deposit cash in excess of your repayments but will be considered as advances on your monthly mortgage bill and will not reduce your loan principal. Subject to credit approval Bank Muamalat can offer up to a 90% margin of finance.
To ease the cost of buying and moving into a new home you can apply for 100% financing where the additional 10% is used to offer zero moving cost (ZEC) on legal fees as well as to cover fees associated with insurance and conveyancing.
What are my obligations?
Well, much like any other borrowing, you will have to make a monthly repayment on your mortgage. The Home Financing-i interest rate is linked to the Islamic Base Rate or IBR, which may move up (or down) in the market you might run the risk of paying more interest.
Thankfully, Bank Muamalat has guaranteed peace-of-mind with ceiling rate of 10.5%, meaning that when the bank IBR is on the bull, it will not go beyond this ceiling rate - thus hedging you from paying more than you could afford.
Is Takaful protection required with the product?
Takaful coverage is compulsory to protect the bank's interest on financing you a long term asset purchase. There are 3 options of Takaful products you can choose: Mortgage Reducing Term Takaful (MRTT), Long Term Houseowner Takaful (LTHT) or Fire Takaful.
You are also allowed to use your own Takaful provider, subject to terms and conditions.
What documents do I need to apply for this mortgage?
If you're a salaried employee:
- Photocopy of MyKad
- Latest 3 months salary slips
- Latest J/ EA Form
- Latest 3 months Bank Statement
- Confirmation letter from employer
- Original S&P Agreement/ booking sheet / down payment receipt
And if you're self employed you'll also need:
Business Registration, Form 24, Form 49, Form A or B, Form D