Islamic Mortgage

[moubeen]

"Islamic" Mortgage

Does anyone have information relating to this topic. And whether it is acceptable. And what scholars have said about it?

[Iqra]

Assalaamu alaikum,

InshaAllah this will help

http://www.drkhalid.co.uk/Mortgage.php

[Turaabie]

http://www.islamicawakening.com/viewarticle.php?articleID=1291

[Aburafay]

Assalamo Alaikum!

I believe there is no disagreemnet with the hurraymat of riba. Thus, what I am going to discuss is in recognition of the fact that riba is haram.

Islam allows ijtehad. It also encourages people to improve themselves in this world financially, and leave something for their dependents.

After consideringthis, I believe there is time for scholars to decide on an islamic mortgage, and dictate what the conditions must be to make it halal.

There is a mortgage available in the western world which seems to be halal to a student like me. All the scholars need to do is to make it strictly in accordance with shariah.

My understanding of the principles that must be present in the system are as follows:

1. People who have surplus money deposit it in a fund.

2. The earnings of this fund are distributed, after meeting the operating expenses, amongst the depositors, in proportion to their shares.

3. The money is distributed to people who are intending to buy property for their personal dwellings.

4. The person seeking finance must meet certain criteria.
(a) They are seriously practicing Muslims. Thus, the availability of funds is not to the general public, but to sincere Muslims.
(b) The person should be in a position to repay the funds borrowed, on a regular basis.

5. The property bought must be assessed as to rental value, and regularly reviewed for this purpose.

6. The owner will pay the fund, monthly, the rent for the property, in proportion to the equity invested by the fund. The owner may pay additional amount to the fund to reduce their equity, and thus the proportion of rent in future.

Any comments to correct my misunderstanding is most welcome.

Wassalam

[Abuz Zubair]

Does it remind me of Amana?

What happens if this brother loses his job?

[Aburafay]

Assalamo Alaikum!

I believe something was started on these lines in Canada few years back, but do not know what it was called. I do not know its status now.

There are some tricky questions that need to be resolved in order to make the concept acceptable. Regarding your specific question, if a brother loses his job, and is a tenant the landlord would have him evicted, if he was unable to pay the rent. Thus, he will have to realise that there is a risk. BUt the Islamic mortgage will be more sympathetic to him than a landlord.

Wassalam