Bank Islam’s housing loan interest rates are based on a floating profit rate system, which means they can change in response to variations in the bank’s Base Rate. As of 5 May 2023, Bank Islam’s Standardised Base Rate (SBR) is 3.00% per annum. For properties valued at RM300,000 and below, the rate is as low as SBR + 0.95% per annum, which translates to an Effective Profit Rate (EPR) of 3.95% per annum. For properties above RM300,000, the rate is SBR + 0.80% per annum, resulting in an EPR of 3.80% per annum.
Bank Islam Home Loan Interest Rate
How Does Bank Islam Baiti Home Financing-i Work?
Bank Islam Baiti Home Financing-i is an Islamic home financing facility based on the principle of Tawarruq. This involves purchasing an asset with a deferred price and selling that asset to a third party to obtain cash. This financing product allows for a high margin of financing up to 90% of the property value and offers flexible terms with a tenure of up to 35 years or until the borrower reaches the age of 70. There is no lock-in period, no compounding elements, and no processing fee—attributes that enhance its attractiveness to potential borrowers.
What Are the Benefits & Features of Baiti Home Financing-i?
High margin of financing, up to 90%, is a significant benefit of Bank Islam’s Baiti Home Financing-i. The facility is available for both under-construction and completed properties, making it versatile for various stages of property acquisition. There is no penalty for early settlement, and the financing tenure extends up to 35 years. Additionally, there are no processing fees, which reduces upfront costs for borrowers. These features make Baiti Home Financing-i a flexible and financially accessible option for home buyers.
Who is Eligible for Bank Islam Housing Loan?
Eligibility for Bank Islam’s housing loan includes several criteria. Applicants must be Malaysian citizens aged 18 and above and should not be bankrupt or facing any legal actions. They must be gainfully employed or own a profitable business for at least three years, with a minimum of one year’s good payment track record. Required documents include a photocopy of the identity card, Sales & Purchase Agreement, and financial statements, among others. These requirements ensure that only qualified individuals who demonstrate financial responsibility can access the loan.
What Are the Additional Fees and Charges?
Several fees are associated with Bank Islam’s housing loan products. Takaful coverage is compulsory, with the Mortgage Reducing Term Takaful (MRTT) or Mortgage Level Term Takaful (MLTT) required to cover the outstanding financing amount in events such as death or Total Permanent Disability (TPD). Other charges include stamp duty, legal fees, and valuation fees, which are typical for property financing. These fees ensure that the loan is well-secured and that the borrower and the bank are protected.
How Can You Apply for Bank Islam Home Financing?
To apply for Bank Islam Home Financing, prospective borrowers must prepare the necessary documentation, including identity verification and proof of income. The process involves filling out an application form and submitting supporting documents like salary slips and bank statements. Bank Islam offers tools like a home financing calculator to help applicants determine their monthly instalments based on the loan amount and tenure. Contacting Bank Islam’s call center for guidance can also streamline the application process.
Is a Bank Islam Home Loan Right for You?
A Bank Islam home loan could be suitable for those seeking Shariah-compliant financing options. The Baiti Home Financing-i offers competitive rates, no lock-in periods, and flexible terms, making it an attractive choice for many. However, potential borrowers should consider the floating profit rate, which can lead to variability in monthly payments. Consulting with financial advisors and comparing with other available home loans in Malaysia can provide a clearer picture of whether this financing aligns with your financial goals and capacity.