Scrolling news:

Help to Buy extended to include ‘Islamic mortgages’

28th Mar 2014

Abdul Adil

The Government’s Help to Buy mortgage scheme has now been extended to include Shari’a compliant alternative to mortgages, Home Purchase Plans (HPPs), the Financial Secretary to the Treasury, Sajid Javid, announced on February 11.

Under the scheme the Government agrees to take on some of the risk of the loan on mortgages of up to 95 per cent of the home’s value. Under the home purchase plans, also known as Islamic mortgages, the buyer initially buys a portion of the home with the bank owning the rest. Over time they pay rent and a fee to acquire the remainder.

The scheme has already helped thousands get on or move up the housing ladder, and the Government remains committed to making the aspiration of home ownership a reality for as many households as possible.

The rules have been amended to enable banks that sell HPPs to purchase a government guarantee for them.

This will be particularly supportive to some Muslim homebuyers who have been unwilling to use a traditional Help to Buy mortgage because of their religious beliefs. However, the inclusion of HPPs in the Help to Buy scheme introduces more choice for all consumers and perspective homebuyers.

“I am delighted Home Purchase Plans will now be available under the Help to Buy scheme. This gives even more choice to hardworking families across the UK trying to fulfil their home owning aspirations,” said Javid

In order to purchase the government guarantee, banks will have to satisfy the same stringent criteria for an HPP as for a normal mortgage. HPPs sold in the UK are also subject to regulation by the Financial Conduct Authority (FCA), in much the same way as mortgages.

One Response to “Help to Buy extended to include ‘Islamic mortgages’”

John MacdonaldJanuary 1, 2015

My Daughter has a married Wallard who is Muslim great person.

Question how can they afford to buy a home when Muslims do not allow them to
pay interest.
Can understand Banks lending into Business to share profits but not into a home.


Leave a Comment

What is 3 + 15 ?
Please leave these two fields as-is:
IMPORTANT! To be able to proceed, you need to solve the following simple math (so we know that you are a human) :-)

The Muslim News Awards for Excellence 2015 was held on 25 March in central London to acknowledge British Muslim and non-Muslim contributions to the society.

The Muslim News Awards for Excellence event is to acknowledge British Muslim and non-Muslim contributions to society. Over 850 people from diverse background, Muslim and non-Muslim, attended the gala dinner.

Latest Tweets

The Muslim News

The Muslim News
Read more