Islamic bank Al Rayan Bank has reduced the rental rates of its 80%, 70% and 60% finance-to-value (FTV) Home Purchase Plans (HPP) by 0.50%.
At 60% FTV (40% deposit) the discounted variable rental rate was reduced to 3.14% and the fixed rental rate was cut to 3.44% while at 70% FTV (30% deposit) the discounted variable rental rate was reduced to 3.24% and fixed rental rate was reduced to 3.54%.
Furthermore at 80% FTV (20% deposit) the discounted variable rental rate was cut to 3.44% and the fixed rental rate reduced to 3.74%.
Maisam Fazal, chief commercial officer at Al Rayan Bank, said: “Al Rayan Bank is the UK’s oldest and largest Islamic bank and offers the country’s widest range of ethical, Sharia compliant home finance products.
“We’re committed to providing a full range of home finance options to all of our customers. By reducing the rental rates on our HPP products we are making Sharia compliant home finance more accessible to individuals whatever stage of the property ladder they are on.”
Al Rayan Bank has also reduced rental rates by 0.50% on its ‘fees assisted’ Home Purchase Plan range.
This is designed to make it easier for people looking to move an existing home finance product to the bank by contributing towards some of the upfront fees normally associated with refinancing from one home finance provider to another.
Following the fixed or discounted period, all rental rates will revert to the Al Rayan Bank variable rental rate. For HPP products currently this is the Bank of England Base Rate (BBR) plus 3.99%.