The product launched by Deutsche Gulf Finance is aimed at consumers seeking capital through financing their home for a variety of purposes including investment in land, residential property or other important family initiatives requiring substantial amounts of capital.

“We feel Ramadan is a special time of the year. Ramadan is a period where most Saudis are together, and at home, with their families and relatives. Our campaign is aimed at giving families great value and flexibility in managing their household finances,” Said Fahad Abdullah Al Rajhi, chairman of Deutsche Gulf Finance said at a packed press conference held at the headquarters of the company in the capital.

“As we are a new entrant to the market, we expect the campaign to be met with enthusiasm by Saudi consumers,” Al-Rajhi said, adding that the call center is staffed to answer questions regarding the “Home Equity Release” program as well as any other questions that may arise from the campaign.

He also said that he has plans to extend the scheme to the eastern and western regions over the next 12 months and subsequently to some countries in the region.

Financing rates for this program start at 2.99 percent and Deutsche Gulf Finance would finance up to 5,000,000 Saudi Riyals subject to credit terms. He added that the program is delivered in an entirely Shariah-compliant structure to meet the needs of Saudi homeowners. He noted that 80 percent of the land value would be given as loans and the loans could be processed within a period of three weeks.

“It gives consumers flexible financing terms, delivered in an ethical and socially-responsible wrapper, to better manage household cash-flow,” Al-Rajhi said, indicating that equity release product will benefit a broad base of customers giving them the opportunity to utilize their most valuable asset (their home) as a financial tool. “We expect that this product will allow families to afford a new home for their newly married sons and daughters,” Al-Rajhi noted.

Speaking about the Saudi mortgage law which is currently under study by the Shoura Council, Al-Rajhi said: “We believe the anticipated mortgage legislation is a necessary step and will be welcomed by Saudi Arabia’s residential real estate financiers and consumers. The regulators, courts, and financial institutions will have to move towards adoption of the associated laws and mandates once the legislation is approved.”

Sheikh Abdulrahman Al-Atram chairman of the Shariah Board said that this scheme is well within the framework of Islamic law and borrowers need not worry about any infringement on Shariah regulations.

Deutsche Gulf Finance is a joint venture between Deutsche Bank and a group of prominent Saudi investors led by Fahad Abdullah Abdulaziz Al Rajhi. The company provides home finance solutions on residential properties for consumers in an entirely Shariah-compliant format. Deutsche Gulf Finance has commenced financing on completed residential properties for purchase, equity release, and investment to Saudi nationals and expatriates.