AlBaraka’s Housing finance product is a Shariah compliant alternative of conventional mortgages. It has been designed on the concept of Diminishing Musharaka in which AIBaraka (the Bank) participates with the customers under the following five options:

• Purchase of a house
• Construction of house on a plot owned by customer
• Purchase of plot and construction of house
• Renovation of house, and
• Assets transfer facility (ATF)

According to Diminishing Musharaka concept, the Bank and customer participate in the joint ownership of a property. The share of the Bank in the property is divided into a number of units and the customer purchases these units of the Bank periodically, thus increasing his own share until all the units of the Bank are purchased by him which makes him the sole owner of the property. Diminishing Musharaka agreement allows the Bank to claim rent according to his proportion of ownership in the property until the complete ownership is transferred and at the same time allows periodical return on his part of principal through sale of the units of his shares. This arrangement is comprised of the following steps:

1. Creation of joint ownership in the property (Shirkat ul milk)
2. Giving the share of the Bank to the Customer on rent
3. Promise from the customer to purchase the units of share of the Bank
4. Actual purchases of the units at different stages

The Bank’s housing finance facility is available in both fixed and variable rate options. Financing is available up to Rs. 20 million which is repayable up to 20 Years expect in case of renovation, where the maximum financing limit is Rs.1 million whereas repayment period is up to 5 years. Additionally, the Bank also offers co-applicant options wherein spouse or close relative (as per policy) can become eligible to support income of the principal applicant to make him eligible for housing facility.

• Tenure
• Eligible financing limits under each product category
  • Financing Limits                
• Disbursement Plan
• Eligibility criteria (Income, age etc)
• Pricing criteria
• Repayment frequency and mode etc.
• How to apply
  • Application form
• Required documents
• General Terms and Conditions
• Schedule of charges specific to housing / mortgage finance
• Rates and charges of agencies other than banks/DFIs
• Branches offering Housing Finance and Contact details
• Extracts of relevant SBP Regulations and Bank’s Policy on mortgage financing
• Frequently Asked Questions
• Installment Calculator
• Mortgage locator