Part of fulfilling the American dream is to use Islamic banking finance tools to buy your own home. While the path is not easy, a sharia-compliant mortgage can help pave the way.
In fact, millions of people in Canada and America go through the process every year. And despite the challenges involved in getting the keys to your own house, these folks understand the benefits are worth it.
Here are a few advantages to buying a home using Islamic banking finance.
1. Build Up Equity
The chances are you’ve heard friends and neighbors talk about buying their homes. If you’re a Muslim, they would have likely used ijara Islamic finance tools for home buying.
You’ve probably also heard them talk about equity. Basically, equity refers to the market value of any house minus the mortgage amount and any other liens against the property. The longer you own your home, the more you build up this all-important equity.
You can use the accumulated equity for several things, including paying for home repairs, funding one’s education, and even planning for trips. It’s like saving money within the walls of your home!
2. Renovate Whenever, However
You may want to paint or even knock down a wall of your rented property. However, renters can’t make those kinds of changes without asking for approval from the landlord.
This is not the case when you own your own home. Getting a home using Islamic banking finance means you can paint any room in any color you choose. Homeowners are free to add decks and make other home modifications without the hassle of asking permission from any landlord.
3. No More Rental Payments
There are many upfront expenses when it comes to buying your own property. A few include the down payment, homeowners insurance, and an appraisal fee. When you begin the process, you’ll find these costs are substantially higher than a monthly rental payment.
What’s good is that you will pay down the amount you owe over time. Eventually, your hard work is rewarded when it becomes clear owning a home is cheaper than renting. Plus, you’re not subjected to volatile rental rates decided by landlords.
4. Be Part of a Community
Homeowners become part of the communities where they live. You pay property taxes that benefit services such as local organizations, schools, and infrastructure. Buying a house gives you an opportunity to interact with other neighbors and make a positive impact in your community.
5. Grow Old in Your Home
People who live in rental properties generally move from home to home. It’s uncommon for them to stay in one place for several years at a time. Owning your own home provides stability. It’s a long-term commitment, so you’ll not likely move after just a few years.
Choosing Islamic Banking Finance with IjaraCDC
Our Islamic banking finance programs are halal. If you are getting ready to apply for this type of financing, there are three areas to consider. Firstly, you need to have a minimum credit score of 640 to qualify for an Ijara transaction. There are other factors regarding the down payment and your annual income. Get in touch with us today and we can walk you through all the requirements.