Explore our approach to ethical home financing
Get ahead with Primary Finance.
Rent or Interest: What's the difference?
Consider the following two examples.
What does it cost?
We give the homebuyer complete control over their finances
What is the difference between this and an Islamic mortgage?
The key difference is that the Primary Finance Home Purchase Plan is free from the burden of debt as we do not force you to buy our share from us, although you are free to buy it from us if you wish.
Who owns the property?
You are the legal owner of the property from the start of the contract. We simply take a legal charge over it to protect our interest in the property. For pricing purposes we treat the property as though we are joint owners and calculate our share of the property based on the amount of money we have contributed.
How often is rent reviewed?
We conduct annual rental reviews. If local property prices in your vicinity have increased your rent will increase; if they have decreased your rent will decrease. The maximum increase or decrease is capped according to the terms in your offer letter. When calculating your affordability and providing you with an illustration we will make the assumption that rent increases by the maximum amount each year. In this way you can be confident that, as long as you stick to the recommended monthly payment, you will never pay more than the illustration although you may pay less.
What is the monthly recommended level of equity purchase?
This is the amount of equity you would have to purchase each month to completely purchase our share by the agreed term. For example if we arrange £120k of finance for you over 10 years then it would be £1k per month.
How is rent calculated?
The rent we charge is based on how much it would cost to rent your property on an active local market, scaled down for our share of the property. We will usually give you a large rental discount in any month where you purchase the recommended level of equity.
What are the eligibility criteria?
To be eligible for finance you must pass our affordability assessment and not have any history of arrears or CCJs. You must also have a good credit score rating and be resident in the UK.