Sharia Compliant Home Purchase Plans
A standard mortgage is built around interest, which conflicts with Sharia principles for many Muslim buyers. Sharia compliant home purchase plans offer a structurally different route to owning UK property – one that avoids interest entirely while still getting you into a home or investment property.
We connect expat clients with providers of these plans as part of the broader service we’ve offered since 2008, working out of our UK, Hong Kong and Kuala Lumpur offices.
How the structure actually works
Rather than lending you money at interest, the finance provider buys the property jointly with you. You then pay two things each month: rent on the portion of the property the provider still owns, and an additional amount that gradually buys out their share. Over the term, your ownership share grows and theirs shrinks, until eventually you own the property outright.
Two structures are most common:
- Ijara – you pay rent throughout the term, with your ownership share increasing through separate payments
- Diminishing Musharaka – rent and capital payments are combined, reducing the provider’s share with every payment
Who offers these plans, and what they’ll want to see
A relatively small number of specialist providers operate in this space compared with the mainstream mortgage market, so the process can take a little longer to arrange. Documentation requirements are broadly similar to a standard mortgage application – proof of income, deposit evidence, identification – though the underlying legal structure of the purchase itself is genuinely different, and it’s worth having that explained properly before you commit.
Our fees
£295 application fee, 1% completion fee.
Frequently Asked Questions
Is a Sharia compliant home purchase plan more expensive than a standard mortgage?
The overall cost is usually broadly comparable once you account for rent and capital payments together, though the exact figures vary by provider.
Can I use this for a buy-to-let property, not just my own home?
Yes, both residential and buy-to-let versions are available depending on the provider.
Do I need to be Muslim to use one of these plans?
No, they’re available to anyone who wants an interest-free structure, regardless of faith.
How is my ownership share tracked over time?
The provider will give you regular statements showing how your share has grown as you’ve made payments.
Can I switch to a standard mortgage later if I want to?
Generally yes, by refinancing, though it’s worth discussing your longer-term plans with us upfront.
Get in touch and we’ll explain which structure and provider best fits what you’re looking to buy.
