ISLAMIC HOME

FINANCING
ISLAMIC BANKING AND
FINANCE
SIR JALIL THEBO

AMAN SACHDEV MUSKAN JHAMBIA SURJEET BAJAJ

MAYOORI VASWANI
 INTRODUCTION
Home finance is financial facility for everyone of us to buy or build our dream house with ease and
flexibility. Everyone between us is not having his own house, some of us lives in villas, some in
bungalows, some in houses, some in slums and some are homeless, everybody needs a house to live
which gives him shelter and we live in a country where poverty ratio is higher than the middle-class
family ratio. Therefore, banks of Pakistan offer home financing scheme where anybody can purchase his
home by paying easy monthly installments. In my point of view home finance is a huge relief to the
public. Nowadays Imran khan’s Government has made Home Finance more convenient and easier by
giving it a name of “MERA PAKISTAN MERA GHAR” in this scheme percentage of markup is
decreased to facilitate the customer more affectively. While getting details about this topic I came to
know that our banking sectors are giving much relief to the citizen, markup is involved but we are not
compelled to pay the whole amount at one time, 20 years is a long time period.
FEATURES OF HOME FINANCING

oBuy an entire residential property be it apartment or bungalow: whole property will be purchased by the bank
and then give it to the customer but the property will be of bank.
oPKR financing limit. 2,000,000 / - converted to PKR. 50,000,000: the home financing limit is from 2 million to
50 million.
oMonthly average monthly payment, rent reduction: payment of home will be given every month and rent will
deducted.
oPayment term is 3 to 25 years: the total time period of paying back the loan to bank is 25 years but this time
period also varies with different banks.
oFinancing up to 70% of real estate value: bank only finance 70% of the value of total property 30% is paid by
the customer itself.
CRITERIA FOR LOAN

 Applicant must be a citizen of Pakistan.

 Applicants must be at least 25 years old at the time of applying for funding and must be at least 60 or not over / retirement
age, whichever is less when funding is mature.
 The minimum monthly income must be 50,000 Pakistani rupees / -
 Permanent job with at least 5 years of continuous employment history in the same industry / field. The current employer of
has at least 06 months of permanent work and there is currently no trial period

For business man

 The applicant must be a Pakistani citizen.
 Applicants must be at least 30 years old when applying for funding, and applicants must be at least 65 years old.
 Minimum monthly income of 100,000 PKR /-

Current business/industry for at least 5 years

APPLYING PROCESS
Salaried person:
• •A valid copy of CNIC
• •02 ​passport size photo
• •The application form has been filled out and signed correctly
• •Original salary certificate
• •Original pay slips of the last three months
• •The commander mentions the department Information letter, letterhead, unit, rank, title and length of service
Business Man:
• Professional proof (commercial or professional proof, may include - may apply):
• Valid copy of CNIC
• 02 passport size photo • Completed and signed application form • Certificate of ownership
• Deed of registered company (In the case of not registered, the company account maintenance certificate shows the percentage list of partners and their shares, as
well as the tax return)
• The last form A and 29 items and memo
• NTN / tax return
• Title / Diploma / Certificate (if any) Professional
• Banking certificate clearly marked
• Title
• CNIC number
• Account number
TWO MAIN PROJECTS

Bank gives two types of home loan, Easy buyer and easy builder, easy buyer is a loan given
to customer for buying a totally constructed house while easy builder loan is the one in
which bank helps to construct owner owned land, also it helps to buy and construct at the
same time while there is also other type in which bank helps expansion of owner’s owned
house.
DOCUMENTS OF APPLYING
FREQUENT ASKED
QUESTIONS
1-Can a co-applicant be added in HBL Islamic Home Finance and can Co-applicant’s income be considered?
Ans: Yes, in the case of HBL Islamic Home Finance, immediate family members (father, mother, brother, son, spouse
and other immediate family members) can become joint applicants for . It is possible to reduce the income of co-
applicants for the approval on the border upgrade.

2- Are there any late payment charges in case of late payments?

Ans: According to Shariah doctrine, the bank cannot charge any late fees because RIBA will charge an additional
outstanding payments. However, in order to avoid delayed payment and instill the necessary culture of financial
discipline, the customer is allowed to promise and promise that if he does not pay the arrears on time, he will pay a
certain amount to the charity, but the bank cannot record this amount in you In the income group, it will then be
transferred to a charity account, which will be managed in accordance with the bank’s charity policy approved by the
Shariah Committee . For the HBL Islamic Family Finance case, these charities consist of a fixed amount of rupees. 2,500
/- for each rent in arrears. Charity account is supervised by the bank’s Sharia Board and used for charitable purposes.
THREE MAIN PROJECTS
Bank offers three main projects: NAPHDA project, Non-NAPHDA project and Non-NAPHDA project 2.

NAPHDA PROJECT
AREA: Flat: 850 sq feet, House Up to: 125 sq yards, 5 Marla
Profit Rate: First 5 years: 3%, after 5 years: 5% and period more than 10 years: 1-year KIBOR + 2.5%
Maximum Price of units: PKR 3.5 MILLION
Maximum Financing Range: PKR 2.7 MILLION
Financing Period: Minimum 5 years and maximum 20 years.
 NON- NAPHDA PROJECT

Area: Flat: 1250 sq feet, house up to: 125 sq yards (5 MARLA)

Profit Rate: First 5 years: 5%, after 5 years: 7% and period more than 10 years: 1-year KIBOR + 4 %.
Maximum Price of Units: No limits
Maximum Financing Range: PKR 6 MILLION
Financing period: SAME
 NON- NAPHDA PROJECT 2

Area: Flat: 2000 sq feet, house up to: 250 sq yards (10 MARLA)
Profit Rate: First 5 years: 7%, after 5 years: 9% and period more than 10 years: 1-year KIBOR + 4%.
Maximum Price of Units: No limits
Maximum Financing Range: PKR 10 MILLION
Financing period: SAME

APPROXIMATE MONTHLY PAYMENTS

Financing RS 1000000 RS 2000000 RS 4000000 RS 6000000 RS 8000000 RS 10000000

Amount

Installments RS 6600 RS 13200 RS 26398 RS 39597 RS 62024 RS 77530