The Benefits of An Islamic Mortgage and Some Other Things You Need To Know
An Islamic mortgage is a sharia-compliant way to buy a house that doesn’t involve paying interest. The IjaraTM Structure that we use has several benefits. These include:
- The fact that you will get reasonably priced finance options that fit within traditional banking structures.
- An Islamic loan that abides by Islamic and sharia law saving you from Riba.
- A product that benefits all the people involved in the process while ensuring safe transactions.
Ijara refers to a home purchase plan that includes a leasing element. With this plan, you make monthly payments which are part capital and part rent and they are held by a trust. Your percentage of the property remains a constant throughout the entire arrangement. That is until the amount initially involved in the loan has been paid off.
Using an Islamic Loan
By the end of the term, you can be the owner of the property involved. Here are some other benefits to using an Islamic loan to buy your own home.
- There are a series of tax deductions. While there are a number of different tax breaks available, a big one is the deduction you get on the property tax and interest part of your mortgage.
- Another big benefit over renting a property is the equity that you put together. It builds in different ways. Equity amasses as the value of your property increases and it also builds as you pay off more of the Islamic loan.
- There are some social benefits to owning your own property too. Homeowners tend to stay in one area for longer periods of time. That’s the way neighborhoods gain stability. Homeowners maintain their properties and the surrounding parks and other areas. That means taking out an Islamic mortgage can also increase your incentives to get involved with community organizations and local politics.
While you are paying off your sharia compliant mortgage, you are also setting aside some money for your family’s future. Once you own the property, there are several ways that you can tap into the equity that you have built up. Many Americans use the money they’ve put together to contribute to retirement plans.
Freedom To Customize With An Islamic Mortgage
Owning your own property means you also have the freedom to customize it. Homeowners can take on different renovations to boost the property’s value or make it exactly what they want.
Homeowners generally stay in the same area for longer periods of time than renters. That adds to the stability in a neighborhood.
A Financial Education
People who buy homes also get a financial education they can pass on to their children. By understanding how to make payments and maintain a property, homeowners gain valuable financial skills.
Take a few minutes to look at the photo gallery on our website. There you will see some of the properties that clients have bought using our IjaraTM Structure and Islamic loan process. Be sure to fill out the contact form or give us a call at the phone number listed.
