U.S. Consumer Finance
Guidance Financial Group is always seeking opportunities to develop new values-based businesses that serve consumers seeking products and services compatible with their beliefs. Guidance recognized that Muslims in the United States had limited opportunity to act on their values when purchasing financial services. In response, Guidance created Guidance Residential to provide them with Shariah-compliant alternatives to conventional housing finance.
Guidance Residential demonstrates our capability to create and manage new companies and succeed in the world’s most competitive consumer finance markets.
Guidance Residential opened its first office in the United States in April 2002 to offer housing finance to U.S. Muslims in a manner that respected their religious principles. The company has provided more than $2.3 billion of home financing and outstanding customer service to thousands of consumers in 22 states, making it the leading principles-based home finance company in the United States.
Guidance Residential’s sound underwriting standards enabled the company to limit its delinquency and foreclosure rate to one-half that of the U.S. mortgage industry during the financial crisis that began in 2008.
Guidance Residential utilizes a Declining Balance Co-ownership Program that establishes an equitable co-ownership relationship between the consumer and the co-owner. The agreement makes the transaction a form of partnership rather than an interest-bearing loan.
Guidance Residential provides its customers with a high level of customer service, including extensive education about Shariah-compliant housing contracts. Guidance’s customers can adhere to their religious principles in making what most often is the largest purchase in a family’s history, and gain protections and benefits not generally available with conventional mortgages.
The Guidance Financial Group Shariah Supervisory Board performs audits of Guidance Residential and its businesses to ensure that useful, competitive and ethical products are developed, delivered and maintained by the company.
Guidance has developed a strong relationship with its housing finance customers and is exploring the possibilities for offering new Shariah-compliant products such as insurance, credit cards and banking service to its customer base.