Halal mortgages need more researching, there are some things that seem dodgy and seem to be covered up riba, here is how islamic bank responds to these Q's:
Q. You state that the rent is calculated on the outstanding amount of the Bank’s share of the
property under the Diminishing Musharaka Agreement. The example is calculated at the rent
rate of 6.95%. This seems like an interest rate. Is it permissible under Sharia’a to determine rent
in this way?
A. It is important to remember that we do not charge interest. We are the landlord and part
owner of the property and have a lease contract where we charge rent and as such all of our legal
documentation and our activities reflect this arrangement. However, to ensure that we give you a
competitive price and to ensure that we are in line with the rest of the market, we use the Bank of
England base rate as a bench mark to ensure that our product is priced competitively with other
products in the market. This has been approved by our Sharia’a Supervisory Committee.
Q. If I make payments late, why do I have to pay additional amounts? Surely this additional
payment is the riba?
A. There may be times when some customers make their payments late and as a financier there will
be additional administrative costs as a result of such late payments and these costs can be recovered.
Once the costs have been recovered any additional amount will be donated to charity and the Bank will
not profit from any extra income received
http://www.islamic-bank.com/imagesup...aflet_v1_1.pdf