Ijara Muntahia Bittamleek (Financial Lease)
Ijara is a form of leasing where a property (building/villa, etc.) is leased by the lessor to the lessee in a way that at the end of an agreed lease period, the lessee becomes the owner of the property by purchasing it from the lessor during or at the end of the lease period at an agreed sale price.
Applying the above, upon your promise to lease from us, we purchase, for ourselves and in our own name, a property specified in your promise and then lease it to you on terms of financial lease. The lease rent is structured in a way that at the end of the lease period, our purchasing cost and profit is recovered and we transfer the ownership of the property to you for a nominal sale price or as a gift by a separate sale or gift contract at the end of the lease period.
Details of the terms under which this product is offered are outlined below:
Terms of Financing:
Down Payment : Minimum 50% of the purchase price*
Financing Period : Up to 10 years
Mode of Payment : Quarterly, Semi-annual or Annual terms are available
Source of Payment : Rentals of the building in question
Profit Rate : Fixed throughout the financing period
Security : Post dated cheques covering installments
Qualified Assets : Residential, Office Buildings & Villa Complexes
Documentary Requirements:
Primary documents comprise:
Individuals
1. Copy of valid passport
2. Completed finance application form
3. Copy of site plan
4. Copy of title deed
5. Copy of lease contracts (covering purchase of existing rented property)
Companies
1. Copy of valid Trade License
2. Copy of Commercial Registry
3. Copy of Partnership agreement (in case of partnerships)
4. Copy of valid passport of partners (in case of partnerships)
5. Copy of valid passport of authorized personnel and copy of Articles of Association defining their powers
6. Copy of site plan
7. Copy of title deed
8. Last 3 years’ financials
9. Copy of lease contracts (covering purchase of existing rented property)
*Requirement may be lowered if additional security is provided.