There are several options available to you when it comes to buying a halal house. These include taking a loan from a bank, using a panel solicitor, or using a sharia bank. Let’s look at a few of them.
Taking a loan from a bank to buy a house halal
In the Quran, taking a loan from a bank to buy your home is halal. However, you must not take out a loan with riba – interest – as this is prohibited by Islam. This is why it is best to seek financial advice from a reputable Islamic bank.
There are a few different types of halal mortgages. The most common one involves a lease concept different from conventional mortgages Lisburn. Instead of charging interest, a Halal mortgage loan is interest-free and has a fixed repayment period. The customer pays a small fee to the bank on each repayment, which covers the rent and other living expenses.
Taking a mortgage is also a permissible way to purchase a house. However, some Muslims consider the interest that banks charge on mortgages to be riba. This is because the money that the mortgage buyer pays to the lender is money that he does not directly benefit from. Also, mortgages may constitute’ murabaha,’ which is the concept of buying goods using the services of another person.
Using a panel solicitor to buy a house halal
When buying a house, a panel solicitor is an excellent choice. As a member of Al Rayan, they will be able to help you get a discounted rate. The solicitors on the panel will be able to assist you with Islamic mortgage issues. They will also be able to liaise with the bank’s solicitor and deal with any special conditions they raise.
Taking a loan from a sharia bank to buy a house halal
A sharia bank provides you with a loan that you can use to purchase a house. These loans are not subject to interest, and they come in two basic forms. The first is called the Ijarah mortgage and involves paying monthly rent on the part of the property you are purchasing. The second form, called the Ijarah home purchase plan, requires you to make monthly installments that are part rent and part capital. These installments should cover both rent and the final purchase price of the property, while still leaving you with a profit for the bank.
The third type is called a halal mortgage. A halal mortgage involves a sharia-compliant bank contributing the majority of the loan amount. The bank will purchase the house you choose, and you’ll then sell it for a predetermined amount. The only difference is that the bank won’t be charging interest or selling the property at a higher price than the borrower.