Posted by: islamicfinancingnews | December 16, 2013

Tips for paying off those Islamic loans faster

One of the things that more traditional types and Islamic loans have in common is the fact you’ll want to pay them as fast as possible. Even though you’re staying Sharia compliant and away from riba with the Islamic variety, reaching the goal of being mortgage free is the way to go.  There buying a homeare a few techniques you can use to pay these mortgages down.

  • Increasing the amount you pay is one of the more obvious methods. Most lending institutions will allow for this when you arrange for the mortgage, or at any time during the term. Using this method cuts down on the amount you owe on the principal.
  • You can take advantage of the prepayment privilege that allows you to make a lump sum payment on the principal. As well, you can make a big payment at the time of renewal. Many Islamic mortgages become open on the renewal date and that’s the time you can make another lump sum payment.
  • Making payments more frequently is another option that helps to get to the finish line quicker.

You need to consider all your options whether you have a traditional mortgage or an Islamic finance product.

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