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Buy your dream
home with similar
costs to existing
banks!

100% Shariah compliant home financing options
for purchasing and refinancing through our
Murabahah (Cost Plus Profit) home finance.

We're currently building our systems to offer banking to the general public in 2023.
We appreciate your patience until we bring you these amazing products.

How does Shariah-compliant home finance actually work?

We buy your choice of home, sell it to you at
an agreed fixed price, and you pay this
in instalments (Murabahah)

Using an example of a $500,000 home purchase where the customer has
savings of $100,000 and needs finance for $400,000 over 30 years

You find your dream home and agree a price

Once you’ve found the home you want to buy, you come to the bank
and tell us the amount you want to buy it for.

We buy it as your agent and then sell it to
you at a fixed price agreed with you earlier

We calculate a “profit” amount for the bank to cover the full 30-year finance term, which we add onto the sale price. This is how the financial institute makes money out of the financing arrangement instead of charging interest. You don’t pay this upfront.

We deduct off your deposit and work out your
monthly “cost + profit” payments

Obviously, in this example you’ve provided us with a deposit of $100,000 towards the property, so we take that off first before we work out how much you’ll have to pay each month for the rest of the finance term.

We split the rest up over 360 months (30 years,
or a shorter length if you’d like)

You’ll then pay us back the remaining amount split into equal chunks each month. Of course, you can pay us fortnightly or weekly as well.

You repay us back the full amount over the
finance term

Simply make payments to your home loan account ever week, fortnight or month. We can even direct debit them from another bank if you don’t bank with us already.

Some things that are
good to think about

You know the profit amount upfront, so you know how much the finance will cost you over the entire finance term - this is different to a normal loan where the rates can go up and down.

It’s really simple – you’re basically just paying the financial institution 1/360th of the financial institution’s sales price to you every month over 30 years.

You are the 100% owner of the property, with the financial institution holding a mortgage over the property.

Due to the fact the profit amount is fixed from day one, it can be more expensive as long-term fixed rates tend to be higher than variable rates currently.

Some people don’t like this type of financing arrangement as when you first start, you will often owe the financial institution more money than the value of the house. This means that if you didn’t meet your repayments, you wouldn’t necessarily have any equity in the home at the beginning until you had paid down the amount outstanding. The financial institution would consider your individual situation in this case.

This type of financing tends to be less common than joint ownership (Diminishing Musharakah).

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Important Regulatory Notice

We’ve received a restricted banking licence from the Australian Prudential Regulation Authority (APRA) that allows us to test our products with a limited number of customers. We make it our duty to disclose our “restricted” status, and that we don’t yet meet the full prudential framework requirements that must be met by an unrestricted bank. After the successful completion of our “restricted” period, we plan to obtain APRA approval so we can publicly launch in 2023.

Important Regulatory Notice

We acknowledge Aboriginal and Torres Strait Islander peoples as the first Australians and Traditional Custodians of the lands where we live and work. We pay respect to Elders past, present and emerging.   

Copyright © Islamic Bank Australia Pty Ltd. ABN 37 609 971 280. AFSL and ACL 534355. AFCA member 76324.

Information on this website does not take your personal circumstances, needs or objectives into account. Please consider its appropriateness for you.   We are not yet open for business.  We are a Restricted ADI and do not yet meet the full prudential framework, and you should consider this before banking with us once we are open for business.  Fees and charges may apply, as well as terms and conditions which you should review. Information on this website is subject to change. In order to open a credit product in future, you will need to meet our credit criteria and be approved.  Please review the product disclosure documentation provided at the time of opening your account for detailed information.