Buy to Let Islamic Mortgages from IBB

Sharia compliant, flexible, affordable finance

Unlike a conventional mortgage where you borrow money from a lender which is then repaid with interest, the BTLPP uses the Islamic finance principles of Co-ownership (Diminishing Musharaka) with Leasing (Ijara), where you and IBB buy the property as partners and you pay rent on IBB’s share in the property.

You acquire IBB’s share in the property by paying a monthly acquisition payment over the term of the finance agreement, or by making a lump-sum acquisition payment at the end of the finance term, if you choose the rent only product.

Up to 65% finance to value

Discounted Variable 4.49%

  • Rental rate discounted by 1% until 31st December 2015
  • Discounted from IBB Buy To Let Finance Rental Rate of 5.49%, which is base rate + 4.99% margin.
  • Reverts to IBB Buy To Let Finance Rental Rate on 1st January 2016.
  • Rent only payment option available
  • Administration fee of 1% of finance amount (minimum £995)

Up to 75% finance to value

  Discounted Variable 4.89%

  • Rental rate discounted by 0.6% until 31st December 2015
  • Discounted from IBB Buy To Let Finance Rental Rate of 5.49%, which is base rate + 4.99% margin.
  • Reverts to IBB Buy To Let Finance Rental Rate on 1st January 2016.
  • Administration fee of 1% of finance amount (minimum £995)

General information

Finance amount
  • £30,000 to £500,000 – England and wales
  • £30,000 to £750,000 – Central London
FTV
  • Acquisition and rent – up to 75%
  • Rental only – up to 65%
  • Central London above £500,000 – up to 65%
Minimum property value 
  • £90,000
Term 
  • 7 – 30 years
Maximum number of applicants 
  • Up to two applicants
  • Minimum income £25,000
  • Where there are two applicants, one applicant must earn at least £25,000
Maximum portfolio
  • Five properties across all providers
  • £2,500,000 across all IBB finance products
Fees
  • Administration fee – 1.00% (min £995)
  • Valuation and legal fees: Paid by the applicant(s).
  • IBB will pay up to £400 (inclusive of VAT) towards the costs of our own solicitor’s fees
Minimum age of applicants
  • 25 years

Rent reviews

  • There will be four rent reviews a year in March, June, September and December
  • New rent rate effective from 1st April, 1st July, 1st October and 1st January
  • Additional acquisition payments can be made in the month prior to each rent review
  • Minimum £4,000 with a £25 administration fee

Margin

  • The bank reserves the right to change the margin on its products however a cap applies of 2%
  • Therefore IBB cannot increase the margin on its HPP products by more than 2% over the margin that applied at the outset
  • You will be given at least 30 days advance notice of any changes in the pricing structure

Settlement

  • The customer has the option to sell the property at any time without any penalties (subject to an administration fee to cover any costs)

 

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