Islamic Finance for Property

Islamic Finance for Mortgages: Your Guide to Sharia-Compliant Solutions with Mortgage One

For many individuals in the UK, owning a home is a key life goal. However, for those following Islamic principles, finding a mortgage that complies with Sharia law can seem challenging. Islamic finance prohibits paying or receiving interest (riba), which is central to most conventional mortgage products.

At Mortgage One, we understand the importance of aligning financial decisions with your faith. That’s why we work with selected, fully Sharia-compliant mortgage providers. We do not advise on Islamic mortgages directly, but can refer you to an approved provider who specialises in Sharia-compliant finance.

In this guide, we explain how Islamic mortgages work, the types available, and how Mortgage One can refer you to a suitable provider for your needs.

Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.

What Is an Islamic Mortgage?

An Islamic mortgage differs from conventional mortgages as it adheres to the principles of Sharia law, particularly the prohibition of riba (interest). Rather than charging interest, Islamic mortgages rely on alternative financial structures that allow individuals to purchase homes in accordance with Islamic teachings.

Common structures used in Sharia-compliant mortgages include:

Murabaha (Cost-Plus Financing): The lender purchases the property and then sells it to the buyer at a higher price, which includes a profit margin. The buyer repays this amount over an agreed period.

Ijara (Lease-to-Own Agreement): The lender buys the property and leases it to the buyer. Rental payments are made over time, and ownership transfers to the buyer once the agreed total is paid.

How Islamic Mortgages Work

Islamic mortgages allow individuals to acquire property without engaging in interest-based transactions. Instead, they involve joint ownership or structured leasing arrangements.

Mortgage One does not offer Islamic mortgage advice. We can refer you to a third-party provider that specialises in fully Sharia-compliant mortgage solutions tailored to your circumstances.

Why Mortgage One Refers You to a Sharia-Compliant Provider

• Faith-Compliance: Our referral partners are approved providers of Sharia-compliant mortgages, ensuring alignment with Islamic financial principles.

• Specialist Expertise: These providers offer detailed guidance and product options designed specifically for customers seeking interest-free property finance.

• Transparent Referral Process: We clearly explain our role as a referrer and ensure you are directed to a provider who can assist appropriately.

Next Steps: Referral Through Mortgage One

If you’re seeking a Sharia-compliant mortgage, contact Mortgage One today. We will refer you to an authorised provider of Islamic mortgage products who can support your needs. Whether you’re exploring home ownership for the first time or reviewing your current arrangements, we will help connect you with a firm that understands Islamic finance.