Last updated 7 November 2026 · Reviewed by Riyadh Financial Services Compliance
What is a halal mortgage?
Home finance that follows Islamic principles, so the financier earns its return from a real asset or partnership instead of charging interest on money lent. People also call it an Islamic home loan, Islamic mortgage or Shariah-compliant home finance.
Is a halal mortgage interest-free?
It has no interest, but it isn't free: you pay rental for the use of the home, and your payments also reduce the amount financed.
How does Ijarah work for a home in Australia?
Ijarah Muntahia Bittamleek is a lease that ends in ownership. You pay rental plus payments that reduce the amount financed; at the end of the term the financier's ownership share passes to you. How Islamic home finance works and Ijarah vs Murabaha explain it in more detail.
Who owns the home?
With our Ijaar home finance you're the registered owner from settlement. The financier holds a registered mortgage and a beneficial interest (an ownership share) during the term, and you must keep the property insured with conventional insurance.
How is it different from a standard home loan?
A standard home loan charges interest on money lent. Ijarah charges rental for the use of a real asset. Both are regulated under Australian credit law. Is Islamic home finance more expensive? covers the costs to compare.
Who can apply, and how?
Australian citizens and permanent residents aged 18 and over can apply. Temporary residents, and Australians or New Zealanders living overseas, can use selected Ijaar home finance; non-residents aren't offered. See temporary residents and Australians overseas.
You apply through an accredited mortgage broker, who has a best interests duty and works nationwide. For brokers: how to offer Islamic home finance.
How can I check it's Shariah-compliant?
Our products are reviewed by Riyadh Financial Services' Shariah adviser, and the certificate is reviewed regularly. Ask us for the current certificate and what it covers, and you're welcome to seek your own scholar's view.
Moneysmart has general information on Islamic finance in Australia.
General information only. It isn't financial, tax or religious advice and doesn't consider your objectives, financial situation or needs. Fees, charges and credit criteria apply.