Buying properties on interest loans : renting or buying a home

Fatawa Question

Bismi Allah al-Rahman al-Rahim Al Salamu Alaykum Wa Rahmatullahi Wa Barakatuh I just found out about your website, al-Hamdulillah, and we would be more than happy to hear your opinion regarding our case. My husband is Syrian, I am European and converted Muslim (Alhamdulillah).We live in Norway for 4 years, and we intent to stay here and build up our own family (In Sha' Allah). We are renting a modest flat in Oslo, and we pay about 1000 euro monthly for it (it’s a normal rent for this city and country).We are practically paying the owner's loan as it’s taken also from a bank. We moved to this flat one year ago when the owner of the previous rented apartment started to grow up the rent. We preferred to take this one, being close to Masjid, so my husband can perform daily the Fajr prayer to the Mosque, and both have the jobs near the house. In Norway there is no Islamic Financial Institution yet, the State Banks are providing among others, the following solution : they buy the house (example : with 150 000 euro),I sign a contract with the bank to pay monthly installments for 30 years(800 euro per month),so the final price for the house is going to be (288 000 euro).Is it permissible to take such a loan with the condition that the monthly installment will not increase over the contracted amount ? And in case of advanced payments from us, the monthly installment will decrease gradually ? Hope to hear from you soon, and may Allah reward you for the efforts to guide on the right path the Muslim communities all over the world ! Best regards, Ammar and Sara

Fatwa

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Publication Date

2010-04-04

Main Subjects

Economics & Business Administration
Financial and Accounting Sciences
Islamic Studies

Topics

• Islamic jurisprudence
• Rented housing
• Dwellings
• Financing
• Purchasing
• Usury

No. of Pages

2

Data Type

Fatawa

Language

English

Record ID

BIM-729729

• APA
• MLA
• AMA