Conventional and Islamic finance of home purchase : house purchase mortgage

Fatawa Question

Assalamu Alaykum Dr. Monzer : Alhamdulillah I have found your webpage today and was eagerly going through your fatwa mortgage 2007. PDF file. I truly admire your devotion to Islamic finance and your efforts. May Allah grant you Tawfiq to do more for the Ummah ? I will appreciate if you clarify my following concerns. 1. I became confused about the extent of "Halal" about bank mortgage. You said "If you need a house and do not find Islamic finance at competitive rate you can go for conventional finance according to the Fatwa of the Second International Conference on Fiqh that was held in Detroit in the fall of 1999". In Canada, we have ISNA housing loan and based on my experience with them for my home buying, the "rent / occupancy charge" was ~ 8.3 % of the amount I borrowed. Whereas with bank, probably I could have got it for ~ 4.5 %. Also, the bank offers open, variable interest rate mortgage. Based on the above scenario, will it be permissible (Halal) for me to go to a bank ? 2. Regarding Zakah, Wassalam, Nazmul

Fatwa

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Publication Date

2008-09-17

Main Subjects

Financial and Accounting Sciences
Islamic Studies

Topics

• Islamic jurisprudence
• Housing
• Financing
• Purchasing
• Real property
• Commercial finance companies
• Subprime mortgage

No. of Pages

1

Data Type

Fatawa

Language

English

Record ID

BIM-734853

• APA
• MLA
• AMA