Islamic Home financing | Home Rent | Riba-free Financing

Easy Home - Islamic House Finance

Easy Home is a completely interest (Riba) free solution to your home financing needs. Unlike a conventional house loan, Meezan Bank’s Easy Home works through the Diminishing Musharakah where you participate with Meezan Bank in joint ownership of your property. The nature of the contract is co-ownership and not a loan. This is because the transaction is not based on lending and borrowing of money but on joint ownership of a house. Meezan Bank, thus shares the cost of the house being purchased. Creating joint ownership and then gradually transferring ownership to the consumer instead of simply lending money is the major factor that makes Easy Home Shariah-compliant.

With Easy Home you participate with Meezan Bank in joint ownership of your property, where the Bank will provide a certain amount of financing. You agree to a monthly payment to the Bank of which one component is rent for the home, and another for your equity share. In fact, the total monthly payment is reduced regularly as your share in the property grows. When you have made the full investment, which had been agreed upon, you become the sole owner with a clear title to the property.

Great Opportunity to Avail Shariah-Compliant Home Financing

Emaar Apartment Financing (Karachi)

Oasis Park Residencia Financing (Karachi)

Chapal Courtyard Financing (Karachi)

Chapal Uptown Financing (Karachi)

North Town Residency (Karachi)

Eligibility Criteria

Citizenship

Pakistani National (Resident or Non-Resident) as per the Bank’s policy

Age

In case of applicant & co-applicant (with income clubbing):

Minimum 25 years and maximum 65 years* at the time of financing maturity

In case of co-applicant (without income clubbing):

Minimum 21 years and maximum 70 years at the time of financing maturity

*For salaried person, the age of applicant must not exceed 65 years OR retirement age, whichever is earlier. (Normal retirement age will be considered as 60 years if not mentioned otherwise).

Customer / Applicant

Primary (or Single) & Co-applicant allowed.
Co-applicant must be an immediate family member*.

*Spouse, parents, adult children, brothers & sisters only.

Income

Salaried & Self Employed Professional (SEP)*

Minimum Gross Income of PKR 50,000** per month.
100% co-applicant’s income may be clubbed in case of spouse only.

Self-Employed / Business Person

Minimum Gross Income of PKR 100,000 per month.

*Self Employed Professional includes doctors, engineers, auditors & architects.
**In case of contractual employees, minimum PKR 100,000 per month will be required

Employment Tenure

Salaried

Permanent job with a minimum 2 years continuous work history in the same industry / field.
For contractual employment, a minimum 2 years continuous work history in the same industry / field along with having a total experience of 4 years.

Self-Employed / Business Person

Minimum 3 years in current business / industry.

Note: In line with State Bank of Pakistan's regulatory requirement, negative history (i.e. overdue/ late payment/ write-off/ waiver) of consumer/individual customers will be reflected in e-CIB reports for two years after settlement.

Products

Easy Buyer

Choose Easy Buyer and get ready to move in!

Easy Builder

For that special home you want to build!

Easy Renovate

Make your home even better or just repair it!

Easy Replace

Transfer your existing mortgage!

Easy Enhancement

Enhance Your Existing Facility!

Payment Plans

UMI Model

Easy Home is structured under the concept of Diminishing Musharakah where by Meezan Bank and Customer enter into a Musharakah Agreement and both the parties provide their investments to be utilized for the purposes of purchase/construction/renovation of the property.
The Joint ownership is created in the property between Bank & customer by virtue of the Musharakah agreement. (This is based on the principle of Shirkat ul Milk). Bank’s share is divided into units and is given to the customer on rent and customer promises to purchase Bank’s share (units) over the tenure of transaction. The customer purchases the units every month and eventually become the owner of the property.
Rental amount is adjusted according to the bank’s share (units) remaining in the property. In UMI , the Musharakah unit price remains constant through out the financing period.

Step-up Model

The Step-up Payment plan is introduced for customers who intend to avail maximum financing facility with lower installment. The step up model is based on Shariah-compliant structure of Diminishing Musharakah.
In this model, the bank’s share is divided into Musharakah units and in the initial half of the facility tenure, the customer purchases one Musharakah unit from the bank every month and in the later half of the facility tenure, the customer purchases two Musharakah units from the bank every month.
Thus the monthly installment during initial years is comparatively lower which is easily affordable. This model is a Shariah-compliant alternative available to the customers who wish to avail maximum financing facility from the Bank.

Profit Rate for Meezan Easy Home

At Meezan Bank, the profit margin is directly correlated to market trends to provide a competitive product to our customers. Shariah allows the use of any conventional market factor as a benchmark to determine the profit rate of a particular product. The mere fact that the applied profit rate of our product is based on similar factors used in determining the applied rate of interest of a mortgage does not render the transaction or the contract invalid from the Shariah perspective, and neither does it make the transaction an interest-bearing one. On the other hand, it is the underlying structure of the product that determines its Shariah compliance.

Salaried Customers

Variable Pricing Rate

Fixed – 1st Year: K * + 3.00 % p.a

Annual Re-pricing: K ** + 3.00 % p.a.

(Floor 8.00% p.a. and Cap 30% p.a.)

* For first year Fixed Rate, 'K' denotes KIBOR (Karachi Inter Bank Offer Rate), announced on 1st working day of each calendar month.

** Applicable KIBOR will be 12-month KIBOR announced on first working day of the month of profit rate revision.

Businessmen Customers

Variable Pricing Rate

Fixed – 1st Year: K * + 4.00 % p.a

Annual Re-pricing: K ** + 4.00 % p.a.

(Floor 8.00% p.a. and Cap 30% p.a.)

* For first year Fixed Rate, 'K' denotes KIBOR (Karachi Inter Bank Offer Rate), announced on 1st working day of each calendar month.

** Applicable KIBOR will be 12-month KIBOR announced on first working day of the month of profit rate revision.

How is Easy Home Shariah-compliant?

Easy Home Fatwa

Meezan Bank’s Easy Home works through the Diminishing Musharakh and conforms to Shariah laws specifically related to financing, ownership and trade. The nature of the contract is co-ownership and not a loan because the transaction is not based on lending and borrowing of money but on joint ownership in a house. Meezan Bank shares the cost of the house being purchased. Creating joint ownership and then gradually transferring ownership to the consumer instead of simply lending money is the major factor that makes Easy Home Shariah-compliant.

With Easy Home the Bank will finance up to 65% and 75% of the property value to businessmen and salaried individuals. The customer agrees to a monthly payment to the Bank, part of which is for use of the house and part for purchasing the bank’s share in the house. When the customer has made the full payment which had been agreed upon, he become's the sole owner with a free and clear title to the property. The profit charged by the Bank is therefore payment for use of its share of the house during the life of the contract.

Application Procedure

Submit a filled & signed application form to Meezan Bank. Submit the required cheque for Processing Fee & External Agency costs.

Attach the required documents with your application

View list of documents

Meezan Bank will verify your residential/office addresses.

For Salaried Self Employed professionals / Businessman, Meezan Banks will conduct necessary credit assessments and associated due diligence based on provided information. (Income Estimator on Meezan Bank's panel conducts income estimation and submits report to the bank)

Meezan Bank will obtain a legal opinion on the property documents provided by you

Meezan Bank's appointed valuation agency will evaluate the property to determine its market value

After you have fulfilled all Meezan Banks credit requirements, the bank will give you a conditional offer letter.

After approval of the case, you are required to open an account at Meezan Bank.

After completion of these steps and approval of your case, you will be required to come to Meezan Bank for signing of the Islamic House Finance Agreement and other legal documents

A Meezan Bank officer & authorized lawyer will accompany you and the seller of the property to the appropriate bank (incase of BFT) or registrars office for Property transfer. Original Property Documents will be handed over to the lawyer who, after verification of the documents, will hand over the pay-order to the banker or seller and will then complete the legal formalities on Meezan Bank's behalf