You will have the title/ownership to the property at closing.īy structuring the transactions in a Shariah compliant manner, we avoid lending you the money and therefore there is no interest involved. At closing, you will provide us with the agreed down payment and the balance of the Murabaha debt will be paid in installments as agreed. To determine the profit, Devon Bank will take into consideration the purchase price, the amount of down payment, the term of repayment and the market rate of return on real estate transactions that our investors expect. The fixed price will include the price Devon Bank paid for the house and the Bank’s profit. Immediately after the purchase, there will be a second transaction.Īt this transaction Devon Bank will sell the house to you for a fixed price, paid over time, with no interest. At closing, you will assign the purchase contract to Devon Bank, which will enable the Bank to purchase the house from the seller on the same terms and conditions that you had agreed to with the seller. The property that has been identified by you for purchase will be purchased by Devon Bank. A Murabaha transaction involves a purchase and deferred-payment resale.
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