How do Halal mortgages work?

It’s a word you are likely to have seen or heard but what exactly does “halal” mean? The Halal Food Authority offers one of the simplest definitions by explaining that halal means permitted or lawful – and contrasts it with its opposite “haram” which means prohibited or unlawful.

Halal is defined, therefore, with reference to the Muslim Sharia law. Within this context, its meaning broadens into concepts of what is permissible, lawful, clean, and ethical.

It is against that background it becomes clearer to think about Islamic mortgages as ethical mortgages – halal mortgages.

What is a Halal mortgage and how does it work?

What makes a halal mortgage an ethical mortgage? It is ethical because it complies with Sharia law. Sharia law holds that interest-driven money lending and investment are harmful and, so, prohibited.

A Sharia-compliant or halal mortgage, therefore, is one that does not rely on interest-based borrowing but on somethi…

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Should I remortgage to consolidate debt?

This is a question you may be asking yourself and which we will attempt to answer within this article. First of all, let’s look at debt consolidation and what it is …

For most people, debt and any number of lines of credit are perfectly normal, everyday features of our financial affairs. Those debts might include secured loans, personal loans, credit card debt, your current mortgage, and any amount of additional borrowing.

As a result, the budgetary calendar is likely filled with a host of dates on which various debt and credit repayments fall due, a range of different interest rates on the outstanding debts, and the ever-present worry that a missed or late payment may have an adverse effect on our credit history.

Is there any simple and straightforward way of streamlining this state of affairs to make your debt management easier – and, potentially, cheaper into the bargain?

What is debt consolidation?

The answer to that question m…

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Can I remortgage to borrow more?

Up to 800,000 UK homeowners could be paying more than necessary for their mortgage, said an article in Homes & Property recently. They could be saving up to seven weeks’ worth of earnings simply by remortgaging, claimed the magazine.

A similar point had been made by Forbes magazine on the 22nd of April 2020, when it referred to the Bank of England’s reduction of the base lending rate to 0.1% on the 19th of March and the subsequent fall in mortgage rates generally.

Reasons to remortgage

Forbes argued that the fall in interest rates allowed many mortgage holders to remortgage their home to enjoy a more favourable, competitive deal.

Many homeowners enjoyed cut-price mortgage repayments while on an initial fixed-rate deal but have since reverted to the lender’s much higher standard variable rate (SVR) once the initial introductory offer expired. Remortgaging – effectively replacing the existing mortgage with a new alternative – offers a way …

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Can I remortgage a paid-off property?

You might be in the fortunate position of having paid off your mortgage – whether the mortgage on your main residence or a buy to let mortgage. Although you are glad that there are no monthly mortgage repayments to make, you rue the fact that there is so much capital locked up in your 100% equity of the property.

You have probably heard of property owners who have gained an improved mortgage deal or unlocked a percentage of their equity and raised additional cash through remortgaging. You ask yourself, therefore, whether you can remortgage a paid-off property.

Mortgage or remortgage?

Credit reference agency Equifax explains that you remortgage a property you own when you pay off any existing mortgage with a new one – effectively, a remortgage is a replacement mortgage.

If you have already paid off any mortgage on the property or if you bought it outright without the need for a mortgage, the property is said to be “unencumbered” (by a mortgag…

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