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HBL PhoneBanking     111-111-425

HBL Diminishing Musharaka

HBL – ‘Diminishing Musharakah’ (“D.M”). Diminishing Musharakah (“DM”) is a form of ‘Musharakah’ which ultimately culminates in the ownership of the asset / project by the client.The bank participates as a financial partner, in full or in part, in an asset/project with a given income forecast. The share of the bank is divided into ‘units of ownership’ and the client undertakes to periodically purchase the units representing the share of the bank, thus increasing his own share till all the units of the bank are purchased by him so as to become the sole owner of the asset.



FEATURES

  • Diminishing Musharakah (“DM”) is a form of ‘Musharakah’ which ultimately culminates in the ownership of the asset / project by the client.
  • The bank participates as a financial partner, in full or in part, in an asset/project with a given income forecast.
  • The share of the bank is divided into ‘units of ownership’ and the client undertakes to periodically purchase the units representing the share of the bank, thus increasing his own share till all the units of the bank are purchased by him so as to become the sole owner of the asset.
  • To create joint ownership in the Musharakah Asset (Shirkat-al-Milk).
  • Giving the share of the financier to the client on rent (Ijarah-Leasing).
  • Promise from the client to purchase the units of share of the financier (Undertaking to Purchase).
  • Actual purchase of the units at different stages.
  • Adjustment of the rental according to the remaining share / investment of the financier in the property.

Documents Required

  • Borrower’s Basic Fact Sheet. (BBFS)
  • Application Form.
  • e-CIB report.
  • Last three years Audited Financials Spreads.
  • Company’s Profile.
  • Valuation Report from approved valuator.
  • Projections for proposed facility tenor.
  • Accepted Offer Letter.

Facilitation Documents

  • Joint Ownership Agreement.
  • Musharakah Agreement.
  • Payment Agreement.
  • Undertaking to Purchase Upon Termination.
  • Undertaking to Purchase Upon Termination.
  • Units Sale Receipt by the Bank.
  • Agreement to Create Mortgage.
  • Memorandum to Deposit Title Deed.
  • Letter of Hypothecation/Pledge or Lien.