Buying a home on interest outside western hemisphere : buying a house through Islamic banking system

Fatawa Question

Dear Dr. Kahf, Assalam Alykum wa Rahmatul-Allah wa Barakatuh First of all, I would like to thank you for your efforts for serving Islam and Muslims across the world. I'm writing you regarding buying a house in Oman through an Islamic Bank. We here in Oman have no Islamic banks nor Islamic transactions thru regular "commercial" banks. The CEO of the Central Bank of Oman announced recently said in a paper that the government is not planning to introduce the Islamic banking system in the country. I've came across a financing company from the Kingdom of Bahrain that can finance buying a house for me in Oman. They work as the guarantee party for me to get a loan from the Bahrain Islamic Bank. They cannot buy the house for me in Oman but they can transfer the money of the house to my account in Oman. In order to make things ""halal"" [according to them], they buy diamond in Bahrain [worth the same amount of money of the house] on behalf of me and they again sell it to another party [The bank representative said that this transaction is monitored by their Islamic advisory committee]. He also mentioned to me that I can have the diamond and I sell it through my own way. He said that they have a fatwa that says that this is isalmically halal. They call this transaction "Tas'heel (تسهيل)" [my friend told me that is called tawaruq in Isalm] My question is ""Is it OK for me to take my house in Oman ? Please note that they apply a fixed profit rate on this money over the period of the loan. Please note that this is considered as my only option to buy a house. I've been renting for about 15 years because I cannot buy (or build) a house on my own and I don't want to get a Riba loan from banks. I hope I've explained the case well. I appreciate your inputs on this matter. Assalam Alykum Wa Rahmatul-Allah Wa Barakatuh. Your this money for buying brother,

Fatwa

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Publication Date

2007-04-24

Main Subjects

Economics & Business Administration
Islamic Studies

No. of Pages

1

Data Type

Fatawa

Language

English

Record ID

BIM-785701

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