What is alrajhi bank Home One Account (H1A)?
alrajhi bank's Home One Account (H1A) offers a solution for homeowners to refinance and consolidate their debts at the same time under a single Islamic financing facility, without a lock-in period or processing fee.
The H1A is structured around the Shariah principle of Commodity Murabahah. Under this arrangement, the bank purchases a Shariah-compliant commodity and sells it to you at a marked-up price, payable on a deferred basis. The proceeds from the commodity sale are then used to settle your existing home loan and outstanding debts. Your property is charged to the bank as security throughout the financing tenure.
How does the Home One Account work?
The H1A bundles two separate term financing facilities into one application:
- Term Financing 1 (TF1) covers the refinancing of your existing home loan. This is the larger component and typically carries the lower profit rate of the two.
- Term Financing 2 (TF2) is for debt consolidation, covering outstanding personal financing, credit card balances, and other financial obligations, as well as cash out for personal use.
For example, if you take up a total financing of RM350,000, RM200,000 might go towards refinancing your property (TF1) and RM150,000 towards settling debts or cash out (TF2). The monthly instalments run concurrently, with different tenure lengths for each component.
What are the profit rates?
Both facilities carry a floating profit rate based on the Standardised Base Rate (SBR), which moves in line with Bank Negara Malaysia's Overnight Policy Rate (OPR).
Based on the current SBR of 2.75% p.a., the indicative rates are:
| Component | Purpose | Indicative EPR | Max Tenure |
| Term Financing 1 | Home refinancing | From 3.95% p.a. | Up to 35 years |
| Term Financing 2 | Debt consolidation/cash out | From 4.35% p.a. | Up to 10 years |
The profit rate is subject to change if the OPR rises or falls. One protection built into the product is the Ceiling Profit Rate (CPR), which is fixed at 10% p.a., which means your EPR will never exceed this cap, regardless of how much the OPR moves.
To give a sense of the rate sensitivity: at the current EPR, a RM350,000 total facility (RM200,000 over 35 years at 3.95% + RM150,000 over 10 years at 4.35%) results in a combined monthly instalment of RM2,424. If the OPR were to rise by 1%, the monthly instalment would increase to approximately RM2,620, a difference of RM196 per month. A 2% rise brings it to approximately RM2,826.
What are the fees that I should take note of?
There is no processing fee for the Home One Account.
The fees you do need to account for are primarily third-party and statutory costs at disbursement:
- Stamp duty: 0.5% of the total financing amount
- Legal fees: As quoted by the solicitors (plus applicable tax)
- Disbursement charges: Registration of charge, land search, and bankruptcy search
- Brokerage fee: 0.0008% of the principal financing amount
- Agency (ARNT) fee: RM1.00 per transaction (subject to SST)
- Property valuation: Required for completed properties; fee varies
Ongoing administrative charges (all subject to SST):
| Fee | Amount |
| Redemption statement | RM10 per request |
| EPF withdrawal confirmation letter | RM10 per request |
| Annual financing statement (ad-hoc) | RM5 per request |
Can I settle my financing early?
You can, as there is no lock-in period and no fixed early settlement penalty. That said, if you settle the facility within the first 5 years, the bank may recover the actual entry costs it incurred; this is relatively standard across home financing products. If you are considering early settlement, it is worth requesting a redemption statement (RM10.00) to confirm the exact figure before proceeding.
What happens if I’m late in my payments?
If you miss a monthly instalment, the bank will charge ta'widh (compensation) on the arrears. This is capped at 1% per annum on the outstanding overdue amount, or the actual losses approved by the bank's Shariah Board, whichever is lower. Repeated missed payments can lead to the bank exercising its right to set off any credit balance you hold with alrajhi bank, and in serious cases, may result in legal action, foreclosure, or bankruptcy proceedings.
Any Takaful coverage that I must take up?
Mortgage Takaful is optional under this facility, though the bank strongly encourages you to take it up. You are required to maintain adequate Houseowner Takaful (or equivalent fire coverage) on the financed property throughout the tenure.
Am I eligible for Home One Account?
To apply for the Home One Account, you need to:
- Be a Malaysian citizen aged at least 21 years old
- Be employed (salaried or self-employed) or have a verifiable income source
- Be refinancing an existing home loan or taking a top-up on an existing alrajhi bank facility
- Have a property that can be charged as security
Documents typically required:
- NRIC (front and back)
- Latest 3 consecutive months of salary slips
- Latest 6 months bank statements
- EPF statement
- Latest EA form or income tax return (BE form)
- Property title/sale and purchase agreement
- Property valuation report (for completed properties)
- Letter of confirmation of employment and remuneration
Self-employed applicants will need to provide business registration documents and financial statements instead of salary slips.
Frequently Asked Questions
Is the Home One Account a conventional home loan or an Islamic one?
It is an Islamic financing product governed by the Commodity Murabahah contract; a Shariah-compliant structure approved by the bank's Shariah Board and Bank Negara Malaysia's Shariah Advisory Council. There is no interest charged, but a profit rate applies to the bank's sale price.
Can I use this to buy a new property?
No. The Home One Account is specifically for refinancing an existing home loan (for new customers) or taking a top-up (for existing alrajhi bank customers). If you are purchasing a new property, alrajhi bank's standard Home Financing-i product would be the applicable option.
What happens to my profit rate if Bank Negara raises the OPR?
Your monthly instalment will increase because the EPR is based on the SBR, which tracks the OPR. The PDS illustrates this clearly: a 1% OPR rise on a RM350,000 combined facility adds approximately RM196 to your monthly payment. Your rate cannot, however, exceed the CPR of 10% p.a.
Can I use the TF2 portion for anything?
TF2 can be used to consolidate existing personal financing and credit card balances, or for general personal cash-out purposes. It is not designated for property purchase.
What is the Ceiling Profit Rate and why does it matter?
The CPR of 10% p.a. is the absolute maximum profit rate the bank can charge, regardless of how high the OPR moves. Under the Murabahah structure, the Bank Sale Price is calculated based on this CPR, which means your total repayment obligation is fixed from day one, even if your monthly instalment fluctuates with the floating EPR. The difference is managed through an ibra' (rebate) mechanism in accordance with BNM guidelines.
How is the monthly instalment calculated?
Your instalment is based on the EPR (not the CPR), calculated on a monthly rest basis. This means interest accrues on the outstanding balance each month, so as you pay down the principal, the interest portion reduces over time.
