Bai' Mu'ajjal and Istisna structures are well-established in Islamic finance globally and are recognised by Islamic finance scholars as valid Shariah Compliant alternatives to conventional lending. Baytulmaal believes it offers a distinctive structure in the Australian market. Please refer to the PDS and Shariah Advisory's Fatwa for details.
Eligible investors can apply to invest in the Fund at any time. If you are applying for property or motor vehicle finance, please contact us to discuss your specific situation and eligibility. In all cases, please read the relevant PDS, TMD and FSG before proceeding.
Please refer to our PDS page10 on "How does the Fund achieve compliance with Islamic finance and investment principles?" The first and main difference is that the source of investment monies is from investors and not from conventional banks or other interest based financiers who charge interest. Secondly, the Fund acquires the property by entering into a purchase contract with a third party vendor. Our contracts involve a genuine sale transaction, Baytulmaal secures the asset before making it available to you, consistent with the requirements of Bai' Mu'ajjal and Istisna under Shariah principles. Thirdly, repayment instalments are fixed for the life of the sale contract.
Yes. Subject to the PDS and Baytulmaal Finances Limited (BFL) 's eligibility criteria, investors may include individuals, joint investors, companies, trusts and SMSFs. Overseas investors may be eligible subject to additional due diligence requirements under our AML/CTF obligations. Please contact us before applying.
Withdrawal requests are subject to Fund liquidity and the Responsible Entity (RE)'s discretion. A minimum holding period of 6 months applies. This Fund is illiquid. Withdrawal is not guaranteed and may be delayed or unavailable depending on Fund liquidity. We strongly recommend reading PDS Section 5,6 and 7.
Individual/joint: $5,000 initial ($1,000 additional). Others: $30,000 initial ($10,000 additional). A lesser amount may be approved at the Responsible Entity's discretion where consistent with the Fund's PDS Section 5 and 6.
Yes. Existing SMSFs may apply, subject to the Fund's eligibility criteria. SMSF trustees should carefully consider their Superannuation Industry Supervision (SIS) Act compliance obligations including the sole purpose test and in-house asset rules before investing. We strongly recommend obtaining independent financial, legal and taxation advice.
Yes ,but only through a Self-Managed Super Fund (SMSF). You cannot invest your existing industry or retail superannuation directly. Establishing an SMSF is a significant decision and we strongly recommend obtaining independent financial, legal and taxation advice first.'
Fund pools investors' capital for Shariah-Compliant property and motor vehicle financing. As with any investment elsewhere, returns are not guaranteed and capital is at risk. Please refer to the PDS Section 6, 7 and 9.
Returns from Bai' Mu'ajjal and Istisna contracts. 60/40 split (60% to Fund minimum). All operating expenses covered by Responsible Entity. Past returns are not a reliable indicator of future returns. The Fund targets returns competitive with the RBA cash rate but, this is a target return only and is not guaranteed. Please refer to the PDS Sections 5 and 6.6.
Yes. Investment applications, and finance applications are assessed separately. Your investment in the Fund and your financing arrangement are treated as entirely separate- your investment does not reduce or offset your contract obligations.
Distributions are generally made quarterly, subject to Fund performance and Responsible Entity's determination. At present, distributions are made in the form of additional unites in the Fund rather than cash payments. This means you will receive more units, not a cash transfer to your bank account. This may change in the future. Please refer to to the PDS Section 6.14.
No. Baytulmaal is not an insurer. Property buyers should arrange appropriate building and contents insurance. Motor Vehicle buyers should arrange comprehensive vehicle insurance. Your contract may specify insurance requirements-please read your contract carefully.
A minimum contribution of 10% of the contract value is generally required. A lesser amount may be approved by Baytulmaal in appropriate circumstances. Please refer to the PDS Section 1 and 6.
There is no automatic right to a rebate on early settlment under Bai' Mu'ajjal or Istisna. Hoeever, Baytulmaal may, at its discretion, consider an adjustment as a gesture of goodwill. Any early settlement must be agreed with Baytulmaal in advance. Please refer to the PDS Section 6 .
Government grants such as the First Home Owner Grant may be accepted as part of your deposit to property finance subject to Baytulmaal's assessment criteria. Government grants are not applicable to Motor Vehicle finance. Baytulmaal is not responsible for applying for any grant on your behalf. Please check the relevant State Government website for eligibility.
Where a guarantor has been provided, the guarantor's obligations under the contract continue following the death of the purchaser. The estate and guarantor should seek independent legal advice promptly.
Your instalment is calculated at the start of the contract based on the agreed total contract price less your initial deposit, divided equally across the contract term. Your instalments are fixed for the life of the contract, they will not change regardless of interest rate movements. The total amount you will pay is disclosed upfront in your contract.
Yes, through a Parallel Istisna arrangement. The Fund may finance the construction of a house of land that you already owned. The Fund enters into a contract with the builder and manages the construction process, while you enter into a Parallel financing agreement with the Fund and make the agreed instalment payments. All applications are subject to the Fund's assessment and approval criteria. Baytulmaal may require a mortgage or security interest over the land as part of the financing arrangement. This will be set out in your contract. Please read your contract carefully before signing.
Yes, the Fund may acquire the land and finance residential construction through Classical Istisna contract. The Fund does not currently undertake large-scale property development. Construction projects carry risk including delays, costs overruns, builder insolvency, material shortages and weather-related disruptions. Any construction cost overruns are bore borne by the Fund. While the Fund conducts due diligence on builders, development and construction risks cannot be completely eliminated. Other than its Parallel Istisna investments, the Fund currently has no property development exposure and does not intend to participate in significant property development activities. The Fund may consider property development investment opportunities in the future. Investors should note that the constructions risks may affect Fund returns. Please refer to the PDS Sections 6 and 9.6.
Yes, subject to to full repayment of all amounts outstanding under your contract, including any fees. Baytulmaal's security interest (mortgage over security, Personal Property Securities Register/PPSR over motor vehicle) will be discharged upon settlement. If the sale price does not cover the outstanding contract balance, you remain responsible for any shortfall. Please discuss with Baytulmaal before proceeding with any sale.
The purchaser is generally responsible for stamp duty (for property) or applicable transfer fees ( for motor vehicle) and and other acquisition-related costs. These vary by state and vehicle type. Please check with the relevant state revenue authority. Furthermore for property transactions, duty implications on both Baytulmaal's acquisition and your purchase should be discussed with your solicitor.
Baytulmaal enters into a contract to acquire the property from the vendor of the house/motor vehicle. The deposit and whole property price is paid from the Fund cash held by the Custodian. As Baytulmall pays the whole price of the house/motor vehicle, it owns the house/motor vehicle from the Shariah point of view and can sell the house/motor vehicle to a homebuyer/motor vehicle buyer even if the title is not registered in the name of Baytulmaal. From a legal perspective, title to the property or motor vehicle is registered directly in your name at the time of settlement. Baytulmaal does not hold registered legal title at any point. Baytulmaal's itnerest is recorded as a mortgage (property) and PPSR registration (motor vehicle) to protect its position as financier until all instalments are paid. Please refer to the PDS Section 6.9.1, 6.9.2 and 6.9.3
Yes. All applications are assessed on a case-by-case basis. Centrerlink payments may be recognised as income in your assessment process. The key criterion is your ability to meet contractual obligations over the contract term.
In an interest-based system, the seller would impose penalties (interest) on the buyer in a case of a late payment. This is not permissible under Shariah law, However it is permissible for the Fund to stipulate in the contract of Ba'i Mu'ajjal or Istisna that if the buyer does not make a payment, the total outstanding amount becomes due. The seller being the Fund is able to secure the payment obligation under the contract. The Fund takes a mortgage over the registered title or PPSR registration or liens, charges or guarantees. This provides the Fund the right to sell the property to recover all amounts outstanding and unpaid under the contract of Ba'i Mu'ajjal or Istisna. Also, a guarantor is required for each house selling which will result in securing the payments when default. Before taking an enforcement action, Baytulmaal will consider any request for hardship assistance as required under NCCP Act 2009. If you are experiencing financial difficulty, please contact us as early as possible to discuss your options. You also have the right to complaint to AFCA (www.afca.org.au or 1800 931 678) if you are not satisfied with our response. Please refer to the PDS Section 6.1.3, 6.2.2 and 6.3.3.
For property finance, the Fund may undertake inspections and due diligence before acquiring the property. For motor vehicle finance, Baytulmaal conducts appropriate checks including valuation and for used vehicles, a PPSR search to confirm there are no exisiting encumbrances. All due diligence is conducted at Baytulmaal's discretion.
Once you have signed your Ba'i Mu'ajjal or Istisna contract and the asset is delivered or settled, you will be responsible for all maintenance, insurance, registration ( for motor vehicles) and other ongoing ownership costs. Baytulmaal's security interest (mortgage or PPSR registration) does not affect your maintenance obligations.
Currently Baytulmaal priorities South Australian opportunities. Interstate applications may be considered on a case--by-case basis, subject to assessment by the Investment & Credit Committee and Directors' approval.
Yes. As a part of our responsible lending obligations under the NCCP Act 2009, Baytulmaal will conduct credit and background checks on all applicants. This may include a credit report, income verification and identity checks. By applying, you consent to these checks being conducted.
As homes become available for sale, we will place details of the the house on our website. Interested applicants may submit an application to purchase the property. Baytulmaal assesses applications against documented and objective criteria, including the applicant's capacity to meet the instalment obligations and other requirement under the Bai' Mu'ajjal or Istisna contract. shortlisted applicants may be invited to attend a meeting before a final selection is made. All applicants are assessed consistently in accordance with Baytulmaal's approved selection criteria.
