Conventional and Islamic finance of home purchase : Ijarah loans

Fatawa Question

I am hoping you can give me advice on a matter. I live in Canada and have been renting for 10 years now. I now have 4 children Alhamdulillah and badly want to purchase a home and have stability. Unfortunately, I just cannot in my heart take out a mortgage even given the Fatwas that allow it in the west. Somehow my heart just won't allow me to do it still. So I have been saving but I am getting very desperate. So, there is a new company that came to Canada called Ijarah Loans form the US. They say they have a product, where I go get a regular mortgage from the bank and then before the first interest bearing payment is made they convert it to a Shari’ah compliant transaction. I don't really understand how it works, it sounds to that basically I end up paying Ijarah Loans then they pay the bank the regular mortgage payment. I also feel this is not ideal, because I am the one to sign the agreement in the first place, and then they are paying the bank the regular interest payments. Please advise as we respect your opinion very much Sheikh. Jazakallahu Khairan Muhammed

Fatwa

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Publication Date

2009-05-05

Main Subjects

Financial and Accounting Sciences
Islamic Studies

Topics

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

No. of Pages

1

Data Type

Fatawa

Language

English

Record ID

BIM-734887

• APA
• MLA
• AMA