FREQUENTLY ASKED QUESTIONS
What is Ijrah?
The Arabic term Ijara means “providing services and goods temporarily for a wage.” The ijara contract involves providing products or services on a lease or rental basis. In the ijara contract, a person or party is given the right to use the object (the usufruct) for a period of time; the owner retains the ownership of the assets.
In Islamic finance, al Ijarah does lead to purchase (Ijara wa Iqtina, or “rent and acquisition”) and usually refers to a leasing contract of property which is leased to a client for stream of rental and purchase payments. ending with a transfer of ownership to the lessee.
This contract conforms with the Australian National Consumer Credit Protection Act 2009 (NCCP).
Our loan manager will explain what documents you will need to provide at the time of application.
Ijarah Finance facilitates a ‘lease to own’ approach or Ijarah Muntahiya Bil Tamleek. This is a widely accepted process of funding an asset acquisition and has been approved by Islamic scholars all over the world.
The financial institution will earn a profit by charging the client rent for the use of the asset.
Extra voluntary repayments can be made to a maximum limit of $15,000 per annum within the fixed rental period.
A flat fee will be charged. This covers administrative fees when our staff are required to open your file and investigate any defaults.
Yes. The client has full rights on the property and client bear the sole responsibility for the property, including maintenance and upkeep.
Yes. You may sell the property or purchase the property outright at any time provided that all outstanding rentals amounts are paid out.
As part of the Ijarah Finance Agreement, the client is a Wakeel or agent of the funder hence the client is responsible for all maintenance, repairs and taxes associated with the property.
Once all payments have been made in accordance with the Ijarah Finance Agreement, the Financier will discharge the property to the client.
Ijarah Finance facilitates a lease agreement with the view to own the leased asset at the conclusion of the lease contract. This is otherwise known as Ijarah Muntahiya Bil Tamleek.
Yes, the property will be registered in your name, but the lease contract will stipulate that you are holding the property as an agent of the funder. Once the final rental instalment has been paid, the funder will discharge the property to you.
At first this may seem counterintuitive to the way a conventional lease arrangement may operate. However, as noted in the discussion above, the Shariah will look at the rights and obligations under the terms of the contract to determine whether the relationship between Financier and Customer constitutes a valid Ijarah.
Equally, this rationale also applies to the Wakala and Wa’ad.
Meezan home financing product has been reviewed by one of Australia’s leading authorities on consumer credit laws to ensure that our home financing products are compliant with the National Consumer Credit Protection Act 2009 (Cth) and the National Credit Code (Cth). This means that consumers of Meezan Shariah compliant products enjoy the same level of protection that Australia’s regulatory framework affords to other Australians
Ijarah Finance have access to various financial institutions who provide either variable or fixed fees depending on the type of contract or asset class. Whether the contract must be variable or fixed depends on individual scholarly opinions. Scholars are not unanimous about this and you will find arguments for and against.
However, at Meezan we only provide fixed rate finance.
It is the practice in Australia for Financiers to require that the financed property be insured.
Takaful (Islamic Insurance) is not available in Australia. We overcome this problem by including a term in the Wakalah Agreement which states that the Customer is purchasing the insurance on behalf of the Financier, and the Financier has adjusted the payments to include the insurance premium. This acknowledgement in relation to premium payment is expressly recognised and evidenced as a key term of the Wakalah.
From a Shariah perspective, Meezan contracts have been drafted such that the Financier is considered as the one purchasing and enjoying the benefit of the insurance. In these circumstances, the insurance is permissible under Shariah.
Our home financing product has been reviewed by one of Australia’s leading authorities on consumer credit laws to ensure that our home financing products are compliant with the National Consumer Credit Protection Act 2009 (Cth) and the National Credit Code (Cth). This means that meezan clients enjoy the same level of protection that Australia’s regulatory framework affords to other Australians.
In delivering this Shariah compliant home financing product Meezan has partnered with some of Australia’s leading financial institutions to ensure that our customers can have peace of mind that their home financing is being managed and serviced by significant and reputable Australian financial service providers, and that we have “best practice” processes in place to assure Shariah compliance.
What Our Clients Say
“We would like to express our thanks for the work you have done for us over the past years. The expertise and attention to detail with which you have handled our financial affairs could not be faulted. Particularly reassuring to us is our feeling of certainty in the absolute integrity of your dealings with us. Your continual advice on financial planning issues has saved us significant amounts of money. May you prosper,
along with your clients.”
Dr Mutasim Sadiq
“Meezan finance provided us an outstanding service throughout the whole application process. The staffs were very responsive to our needs, answered our telephone calls and emails promptly, followed up with sellers, solicitors and arranged property settlement for us. We are happy that through Meezan Finance we have achieved the best Islamic loan for our family’s needs. We have no hesitation in recommending Meezan wealth to anyone.”
Usman Saleem
Senior Technical Manager (IBM)
“Passion, knowledge and a genuine interest in achieving the best for clients is what makes a truly professional Financial Adviser. Rokibul always had this and more. His dedication to clients, business excellence and education sets him apart and I would highly recommend him to anyone wanting to achieve better financial outcomes.”
Sameer Syed
IT Developer (Inenco Group)
“I am absolutely delighted with your service. It is really refreshing to work with a financial adviser who is truly interested in their client’s needs, circumstances and preferences. What really impressed me was the way you took the time to get a feeling for where I was at, your depth of knowledge, lateral thinking and your common-sense approach. Your professional, ethical and caring demeanour elicits my trust and respect and I gladly recommend your services whenever possible.”
Amer Islam
IT Consultant
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