How Does Guidance Determine The Price For Facilitating Home Ownership Through Their Program?
Guidance’s program is distinctly different from conventional models where a lender charges for money lent. Guidance charges a usage fee (profit payment) for occupation of the home.
Homebuyers naturally insist that shariah alternatives be competitive. This led to the usage fee be indexed against prices from the conventional home finance market. Shariah scholars deemed this permissible as the pricing doesn’t change the ruling. However, if an Islamic index existed, it would be preferred to use that.