Conventional
Loan-based relationship
Lender provides money
Funds are advanced to the customer.
Customer repays loan + interest
Interest is charged on the money lent.
A clearer path to home ownership
Islamic Home Finance
A simple guide to how Sharia-compliant home finance works.
Education first. Clear structures, considered questions and support through the process.
Asset-backed
The property is part of the transaction.
The contract may use a sale, lease or shared ownership structure.
How it works
The structure matters as much as the number.
Islamic home finance is structured around a Sharia-compliant transaction involving an asset, such as a sale, lease or shared ownership.
Islamic
Asset-based transaction
Financier enters a transaction involving the property
The asset sits within the agreed structure.
Sale, lease or shared ownership
Return follows the underlying contract.
The key difference
The underlying contract and how the financier’s return is generated.
Both arrangements can involve regular monthly payments.
Why does a rate still appear?RATE ≠
RATE ≠
UNDERLYING CONTRACT
A rate can be a calculation tool — the contract still matters.
A percentage or market benchmark may be used to calculate or benchmark the financier’s return. The percentage alone does not determine Sharia compliance. The relevant questions look beneath the rate.
Contract
What legal and commercial transaction is being entered into?
Return
How is the financier’s return calculated and earned?
Ownership
Who owns the property, and when does ownership transfer?
Sharia review
Who has reviewed the structure for Sharia compliance?
Rights & responsibilities
What must each party do throughout the agreement?
How can the financier make a halal return?
A commercial return can come from a permitted transaction.
The form and substance of the agreement are central. Each structure assigns ownership, risk, rights and obligations differently.
01
Sale
Cost-plus sale
The financier acquires an asset and sells it at an agreed price that includes a disclosed profit.
02
Lease
Leasing
The financier owns an asset and receives agreed rental payments for its use under the lease.
03
Shared ownership
Progressive acquisition
The customer progressively acquires the financier’s share while paying for use of that share.
Halal does not mean free. The financier can earn a legitimate commercial return through a transaction structured to comply with relevant Islamic principles rather than through riba.
Common structures
Different structures. Different legal relationships.
Names help describe a model, but the product documents explain how that model operates in practice.
Murabaha
Cost-plus sale
The financier purchases the property and sells it to the customer at an agreed price, including a disclosed profit.
Understand this structure
- The financier purchases the property.
- The financier sells the property to the customer at a price agreed in advance.
- The customer pays the agreed sale price over the agreed period.
The financier’s return is incorporated into the agreed sale price rather than structured as interest charged on a loan. Payment terms are established in the sale contract.
Ijara
Leasing
The financier acquires the property or an interest in it and leases it to the customer under an agreed arrangement.
Understand this structure
- The financier acquires the property or an interest in it.
- The customer makes agreed payments for use of the property.
- Ownership arrangements are determined by the specific contract.
The financier receives an agreed return for leasing the use of the asset. The exact ownership arrangements, structure and conditions vary between providers.
Diminishing Musharakah
Shared ownership
The customer and financier share ownership. The customer progressively purchases the financier’s share.
Understand this structure
- The customer and financier jointly own the property.
- The customer progressively purchases the financier’s share.
- The customer reaches full ownership, subject to the specific contract.
The financier may also receive payments associated with the customer’s use of its remaining share. As the customer’s ownership increases, the financier’s ownership decreases.
What should you check?
Eight questions for a more informed comparison.
Take this checklist into every product conversation.
Contract
Read the agreement and identify the underlying transaction.
Return
Understand how the financier’s return is set and adjusted.
Ownership
Confirm who owns what, when and on which terms.
Sharia review
Ask who reviewed the structure and the scope of that review.
Total cost
Compare all payments, fees, charges and likely scenarios.
Early repayment
Check the process, amounts payable and any adjustments.
Default
Know the consequences, remedies and support available.
Australian requirements
Confirm the structure meets applicable legal and regulatory needs.
Wurley’s role
Clarity for the journey, not advice on the decision.
Wurley helps customers understand available options, compare structures and navigate the process. We explain the landscape clearly without implying legal, financial, tax or religious advice.
Understand
Make sense of available options and the language used in each structure.
Compare
Look at contracts, costs, ownership and practical differences side by side.
Navigate
Move through the process with clear questions and an organised next step.
A guided conversation
Human supportYour question
How do I compare a lease structure with shared ownership?
Wurley
Start with ownership, payment mechanics, total cost and what happens if circumstances change. Then review the product documents with independent advisers.
A clearer set of questions for your next conversation.
Your next step
Want to understand your options?
Start with a clear conversation about the structures available and the questions worth asking.