Islamic property finance firm, Offa, has announced a series of rate reductions across its Sharia-compliant buy-to-let products.
Offa’s two-year buy-to-let rates have dropped up to 0.21% and five-year rates by up to 0.24%, with additional rate cuts on tracker rate products. Homes in multiple occupancy (HMO) and multi-unit freehold block (MUFB) product fees have also dropped from 1.5% to 1%.
Offa recently announced that first-time buyers can now get buy-to-let finance and the minimum age required dropped to 18-years-old. Buy-to-let applicants will also only need to earn £18,000 per annum.
As part of the new criteria, portfolio clients are subjected to more realistic stress testing, based on the average of current five-year fixed rate products rather than standard variable rate – making large portfolio cases more viable. Offa also expanded opportunities for overseas clients, with British expats in Malaysia and Hong Kong also now eligible for Offa’s Sharia-compliant buy-to-let finance.
Instead of using interest, Offa’s buy-to-let product involves the Islamic finance principles of co-ownership-with-leasing. Customers acquire the property in partnership with Offa and make monthly payments to increase their share, over time owning it.
The company follows an ethical finance model designed in accordance with Islamic finance principles, which means not charging interest and investment into sectors deemed harmful to society – such as alcohol, tobacco, animal testing and the arms trade.
Sagheer Malik, chief commercial officer and managing director of retail finance at Offa, said: “We will continue to drop rates for our fast and easy Sharia-compliant buy-to-let finance products whenever possible, always focusing on giving our customers the best deal.
“We are dedicated to bringing Islamic finance into the 21st century, leaving behind the onerous paperwork and cumbersome systems that many customers have typically suffered in the past. Our streamlined digital application process – which is unparalleled in the Islamic finance market – means clients can potentially get a fair decision within minutes, depending on credit rating and risk criteria.”
