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Key features of housing finance by Meezan bank and Muslim commercial bank

MEEZAN BANK EASY HOME — ISLAMIC HOUSING FINANCE

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 for use of 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 free and clear title to the property.

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.

KEY FEATURES

– Affordable Rental
– Highest Financing Amounts
– Rental paid after delivery, not in advance
– Maximum Finance against Property Value
– Fastest processing and delivery
– Flexibility to make Partial Pre-payments
– Shariah Complaint Life Takaful Facility
– Affordable Installments and regular reducing monthly rental
– Eligibility Criteria
– Citizenship
– Age
– Customer/Applicant
– Income
– Employment Tenure
– Products
– Easy Buyer
– Flexible financing from minimum PKR 500,000 to PKR 50 million for Salaried, SEP, NRP & Businessmen customers
– Easy selection of financing tenure from 3 years to 20 years
– Maximum 25 years tenure for Salaried & SEP customer
– Bank Investment Ratio (BIR)
– Up to 75% for Salaried/SEP/NRP
– Up to 65% for Business persons.

EASY BUILDER

– Easy Builder allows you to get financing for Residential House on already owned land OR purchase of land & construction thereon
– Flexible financing from minimum PKR 500,000 to PKR 50 million for Salaried, SEP, NRP & Businessmen customers
– Easy selection of financing tenure from 2 years (excluding construction period of max 12 months) to 20 years
– Maximum 25 years tenure for Salaried & SEP customer
– Profit Rate for Meezan Easy Home

SALARIED CUSTOMERS

– 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
– For annual revision, “K” denotes 90 days average of 12-month KIBOR (Karachi Inter Bank Offer Rate), announced for each calendar quarter by the Bank.

BUSINESSMEN CUSTOMERS

– 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
– For annual revision, “K” denotes 90 days average of 12-month KIBOR (Karachi Inter Bank Offer Rate), announced for each calendar quarter by the Bank.

MUSLIM COMMERCIAL BANK (HOME LOANS)

MCB Home Loan opens doors to numerous sensible financing options to help you purchase, build or renovate your new/existing home.

The following are the features of MCB Home Loan:

HOME PURCHASE: Purchase of ready property.

HOME CONSTRUCTION: Construction of house on land owned by borrower(s) where the loan is disbursed in tranches.

HOME RENOVATION: Renovation/improvement of existing home where the loan is disbursed in tranches.

PLOT PURCHASE AND CONSTRUCTION: Purchase of land/plot and construction on it where the loan is disbursed in tranches.

CITIES: Karachi, Lahore, Faisalabad, Rawalpindi and Islamabad are the cities where you can purchase, constructs or renovates your house through MCB Home Loan.

GENERAL TERMS AND CONDITIONS

– Repayment in equal monthly installments (EMI)
– Information regarding availed loans from other banks should be authentic
– Personal information should be valid
– Mandatory verification checks of borrowers and collateral
– Bureau reports regarding repayment history of all borrowers wherever applicable should be unambiguous, positive and satisfactory
– Property insurance is mandatory
– Equitable/Token Registered Mortgage/Registered Mortgage as per Bank’s requirement
– Collateral appraisal through bank’s approved valuation agencies
– Income estimation through bank’s approved agencies

EXTRACT OF RELEVANT SBP REGULATIONS AND BANK’S POLICY ON HOME LOANS

SBP Regulation: Total monthly installment should not exceed 50% of net disposable income.

MCB Bank policy: Debt to equity ratio to be as per Bank’s requirement.

MCB Bank policy: Maximum loan tenure is 20 years.

MCB Bank policy: The collaterals are evaluated by bank’s approved evaluation agencies.

MCB Bank policy: Floating rate is extended for home finance which is re-priced on first working day of each year. The spread would, however, remain constant while the change in KIBOR shall affect the pricing.

ELIGIBILITY CRITERIA

– Applicant(s) must be Pakistani Resident Nationals
– Salaried, Self Employed Businessmen/Professionals
– Satisfactory verifications
– Satisfactory bureau checks
– Satisfactory income estimation, property valuation and legal opinion

LOAN AMOUNT

– Home Purchase: PKR 50 Million
– Home Construction: PKR 25 Million
– Home Renovation: Up to PKR 15 Million
– Plot Purchase Plus Construction: PKR 50 Million

REQUIRED DOCUMENTS

– Application form
– Copy of valid and original CNIC/SNIC
– Two passport size photographs
– Declaration of all financing facilities availed from all banks/DFIs
– Income documents
– Business /employment proof
– Copy of property documents
– Any other document required by the Bank

The information provided is as per the current practice and the policy/process can be changed. Moreover, this is very limited information and the Bank reserves the right to decline/reject any case.

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