Ijara Community Development Purchase Plus Improvements is available nationwide in Canada. It folds the home purchase and the renovation into one ijara so you do not renovate on an interest line of credit. Funds are typically released after the work is verified. Minimum down payment is 5% on the first $500,000 and 10% above that (10% if you are self-employed). Terms are 1 to 5 years, amortization 25 years, with 10% to 20% annual prepayment. Manzil does not have a published purchase-plus-reno product in our data. Do not invent one.
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What Purchase Plus Improvements Is
You are buying a house that needs work: kitchen, roof, basement suite, or a similar improvement that a conventional lender would put on a separate interest LOC or a purchase-plus-improvements mortgage. The riba problem is the renovation money, not only the purchase. Ijara CDC's product is one ijara that covers both legs so you are not running an interest facility beside a halal purchase. Compare on the home financing hub.
Terms on File
| Item | Ijara CDC Purchase Plus Improvements |
|---|---|
| Where | Nationwide in Canada |
| Structure | One ijara that folds purchase and renovation together |
| When funds go out | Typically released after the work is verified |
| Down payment | 5% on the first $500,000; 10% above that; 10% if self-employed |
| Term and amortization | 1 to 5 year terms; 25-year amortization |
| Prepayment | 10% to 20% annually |
| Shariah board | Mufti Muneer Akhoon; Shaykh Mufti Mohammed-Umer Esmail |
Manzil offers musharaka home financing in Ontario, British Columbia, Alberta, and Saskatchewan, and murabaha in Ontario. That is a purchase file. It is not a published purchase-plus-improvements product. Ask Manzil for a standard purchase if the province allows. Ask Ijara CDC for Purchase Plus Improvements if you need the renovation in the same contract.
Why Not an Interest Line of Credit
A HELOC, a conventional purchase-plus-improvements mortgage, or a contractor's 'finance the Reno' offer is interest on money. Paying cash for the renovation after a halal purchase is clean if you have the cash. If you do not, the Ijara product is the file that exists to replace the interest LOC. Confirm the renovation budget, the inspector or verification step, and the draw schedule in writing. Do not confirm whether Ijara offers this in Canada. It does, nationwide.
How to Apply
- Price the purchase and a written renovation scope on the same property
- Ask Ijara CDC for Purchase Plus Improvements by name. Do not ask Manzil for a product we do not have on file
- Confirm down payment on this price (5% / 10% bands, 10% self-employed)
- Confirm that draws are released after work is verified, and who verifies
- Read term (1 to 5 years), 25-year amortization, and 10% to 20% annual prepayment before you pay a fee
- If the renovation does not qualify, buy with a standard ijara or musharaka and pay cash for the work rather than opening an interest LOC
Frequently Asked Questions
Does Ijara CDC offer purchase plus improvements in Canada?
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Yes. Purchase Plus Improvements is nationwide in Canada. It is one ijara for the purchase and the renovation. Funds are typically released after the work is verified.
Does Manzil offer a purchase-plus-reno product?
Not in our data. Do not invent one. Use Manzil for a standard purchase in the provinces it mortgages. Use Ijara CDC when you need purchase and improvements in one ijara.
What is the down payment?
5% on the first $500,000 and 10% above that. Self-employed is 10%. Confirm the band on this purchase price, not on a round number from a blog.
Can I renovate on a bank line of credit if the purchase is already halal?
The LOC is still interest. That is the product Purchase Plus Improvements is trying to replace. Pay cash for the work, or keep the renovation inside the Ijara file.
Bottom Line
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See side-by-side comparisons of Shariah-compliant products, or let our matcher recommend the best options for your situation.
If you are buying and renovating in Canada without an interest LOC, Ijara CDC Purchase Plus Improvements is the nationwide product on file. Manzil is for the purchase in its provinces, not for a published purchase-plus-reno add-on. Compare on the home financing hub.
