3. DEFINITION
• Refers to the sale of goods on a deferred
payment basis at a price which includes a
profit margin agreed by both Customer and
Bank.
4. ESSENTIAL
ELEMENTS/CONDITION
• Capable of accepting responsibility
-sound mind
- matured
- intelligent
• Not restricted from dealing in business
transaction
- not bankrupt
• Not being forced into contract
SELLER/
BUYER
TRADING CONTRACT – BUY AND SELL
5. • Exist
• Halal (lawful)
• Valuable
• Seller – real owner
• Known to seller and buyer
MERCHANDISE/
GOODS
6. ESSENTIAL
ELEMENTS/CONDITION
• Must be known (stated in the
contract)
• Currency specified
PRICE
• In definite/decisive language
• Acceptance consistent with offer
• Done in a contract meeting
AQAD
7. HOME FINANCING TERMS
TERM DESCRIPTION
1. Margin of financing Up to 100%
2. Payment period Up to 30 years
3. Financing rate/ profit rate Fixed and competitive
4. Processing fee Waved
5. Eligibility Resident/ non – resident
6. Takaful coverage Long Term House Owner’s Takaful
Takaful Mortgage Plan
7. Documents required Photocopy of applicant’s IC
Latest 3 months salary slip
Employer’s confirmation letter
From J/EA
S&P Agreement of LO from developer
8. Benefits Selling price is known
No extra charges
Flexible payment method
Early payment entitled to rebates
9. HOME FINANCING
ILLUSTRATION
EXPLANATION:-
1. The customer identified the house he wishes to buy. Then,
customer will sign S&P agreement and pays the deposit to
house developer since he had agreed.
2. The Islamic bank will purchase the qualified asset from the
developer on purchase price on the cash basis.
3. The bank will sells the asset to customer at a marked-up
price.
4. The customer will repay back the selling price on a
installment basis.
11. 1) i-WISH HOME FINANCING-i
• A no-frills basic Islamic home financing which is a Shariah
compliant product.
• Less than RM100,000
Benefits:
• No set up or monthly maintenance fee.
• Refinancing from a conventional loan to Islamic financing
entitles customer to a full waiver on the stamp duty.
• New purchasers, subsale, top up, unencumbered property
financing entitles customer to a 20% waiver on the stamp duty.
• Rate protection from the Base Rate (BR) increase with capped
ceiling rates.
12. Features Terms
Profit rate Up to BR + 0.55%
For Cashline Facility-i BR +
1.85%
Tenure Up to 35 years/ 70 years of age
Age requirement 21 years old and above
Margin of financing Up to 90% + 5% Mortgage
Reducing Term Takaful/ or
Financed Entry Cost
Max 70% MOF for Cashline
Facility-i
Financing type • Completed or under-
construction property
• Subsale
• Top up financing
• Refinancing from another bank
with or without cashout
• Unencumbered property
financing
13. 2) i-WISH FLEXI HOME FINANCING-i
• A flexible Islamic home financing which is linked to the current
account.
• More than RM100,000
Benefits:
• No set up or monthly maintenance fee.
• Deposits in the Mudharabah current account will be set off
against the financing outstanding principal for profit charge
calculation. Earn profits as well on the deposits itself.
• Cheque book and ATM card for easy withdrawals from the
deposit linked account.
14. • Refinancing from a conventional loan to
Islamic financing entitles customer to a full
waiver on the stamp duty .
• New purchasers, sub sale, top up,
unencumbered property financing entitles
customer to a 20% waiver on the stamp
duty.
• Rate protection from the Base Rate (BR)
increase with capped ceiling rates.
15.
16. Selling Price (SP) based on CRR
SP = PR * n
PR = AF * Financing Amount (Purchase Price)
AF = r ( 1 + r ) ^ n / ( 1 + r ) ^ n
NOTE :
r = profit rate (CRR)
n = number of periodic payment (month)
AF = annuity factor
PR = periodic payment
Installment Financing Computation
17. EXAMPLE :
..Based on profit rate of 6%
FA : RM 100,000
r : 9.9%
n : 240 (months)
STEP 1: Annuity Factor (AF)
r = 9.9 / 12 =0.00825
n =240 monthly installments
AF =[0.00825(1+0.00825)^240] / [(1+0.00825)^240-1]
=0.009584
STEP 2 : Periodic Repayment (PR)
=AF x Financing Amount (PP)
=0.009584 x 100,000
=RM 958.40
18. • If default payment for 2 months
=958.40 × 2 months
=RM1916.80
=1916.80 × 1% × (2/12)
=RM 3.19
21. SHARIAH ISSUE
1. Why non-Muslim can accept the Bay
Bithaman Ajil contract compare than
Muslim?
2. Can the applicant make a home financing
under Bay Bithaman Ajil contract, if they
does not have any collateral?
3. Why people chooses Housing Loan instead of
Home Financing?