Mr Z is the owner of 80 % of a real estate property, along with Mr Y who owns 20 % of the same property. Mr Z is willing to acquire the full share of Mr Y and become the 100 % owner of the property

Fatawa Question

Mr Z is the owner of 80 % of a real estate property, along with Mr Y who owns 20 % of the same property. Mr Z is willing to acquire the full share of Mr Y and become the 100% owner of the property. Mr. Y is willing to sell his part of the ownership to Mr Z at the current market price. Mr Z requires finance from an Islamic bank to be able to achieve his objective. Can the Islamic bank provide Shariah compliant financing to Mr Z for this purpose ? If so, what could be the mode of such financing ? It is important to note that the property is already mortgaged to the bank against a financing facility earlier extended by the bank to Mr Z who paid a 25 % down payment at the time of acquiring his 80% share of the property three years ago when he acquired the bank’s finance for the balance amount . He has so far been regular in his payment of the Murabahah installments in the five-year Murabahah tenor and shall settle the additional finance in the remaining two years along with the current Murabahah.

Fatwa

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Publisher

Islamic Finance News

Publication Date

2013-04-17

Country of Publication

Malaysia

Main Subjects

Economics & Business Administration
Islamic Studies

Data Type

Fatawa

Language

English

Record ID

BIM-784624

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• AMA