Jan 23, 2013

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Is Mortgage Permissible in Islam

Is Mortgage Permissible in Islam

Question:

salam brother

i want to ask if mortgage is under certain circumstances allowed? as recently i had an argument with my friend who said its allowed if we do not have any other option can you please shed a light on it? that either mortgage is haram or its allowed under certain circumstances?
Shukran

Answer:

As-salāmu ‘Alaykum Wa-rahmatullāhi Wa-barakātuh.
In the Name of Allah, the Most Gracious, the Most Merciful.

At the outset mortgage entails that one takes an interest bearing loan from the bank and gives the very house he is taking the loan for as collateral.[1] If the individual fails in any of the disbursements or is unable to keep up with the payments, then the bank has the right to repossess the property.[2] The fact that the person is required to take an interest bearing loan with the bank renders the mortgage impermissible in Islam.

According to Shariah there are explicit and grave warnings for dealing into interest in the Holy Qura’an and the Ahaadith of our beloved Prophet Sallalahu Allayhi Wassallam.

Allah Ta’ala mentions in numerous verses of the Holy Qura’an with regards to Interest;

الَّذِينَ يَأْكُلُونَ الرِّبَا لَا يَقُومُونَ إِلَّا كَمَا يَقُومُ الَّذِي يَتَخَبَّطُهُ الشَّيْطَانُ مِنَ الْمَسِّ  ذَٰلِكَ بِأَنَّهُمْ قَالُوا إِنَّمَا الْبَيْعُ مِثْلُ الرِّبَا  وَأَحَلَّ اللَّهُ الْبَيْعَ وَحَرَّمَ الرِّبَا ۚ فَمَن جَاءَهُ مَوْعِظَةٌ مِّن رَّبِّهِ فَانتَهَىٰ فَلَهُ مَا سَلَفَ وَأَمْرُهُ إِلَى اللَّهِ  وَمَنْ عَادَ فَأُولَٰئِكَ أَصْحَابُ النَّارِ  هُمْ فِيهَا خَالِدُونَ

Those who eat Riba (usury) will not stand (on the Day of Resurrection) except like the standing of a person beaten by Shaitan (Satan) leading him to insanity. That is because they say: “Trading is only like Riba (usury),” whereas Allah has permitted trading and forbidden Riba (usury). So whosoever receives an admonition from his Lord and stops eating Riba (usury) shall not be punished for the past; his case is for Allah (to judge); but whoever returns [to Riba (usury)], such are the dwellers of the Fire – they will abide therein.[3]

يَا أَيُّهَا الَّذِينَ آمَنُوا اتَّقُوا اللَّهَ وَذَرُوا مَا بَقِيَ مِنَ الرِّبَا إِن كُنتُم مُّؤْمِنِينَ

O you who believe! Be afraid of Allah and give up what remains (due to you) from Riba (usury) (from now onward), if you are (really) believers.[4]

يَا أَيُّهَا الَّذِينَ آمَنُوا لَا تَأْكُلُوا الرِّبَا أَضْعَافًا مُّضَاعَفَةً

وَاتَّقُوا اللَّهَ لَعَلَّكُمْ تُفْلِحُونَ

O you who believe! Eat not Riba (usury) doubled and multiplied, but fear Allah that you may be successful.[5]

Sayyiduna Abu Hurairah Radiyallahu Anhu narrates that Rasulullah Sallallahu Alayhi Wasallam said:

عن أبي هريرة، قال: قال رسول الله صلى الله عليه وسلم: الذهب بالذهب وزنا بوزن، مثلا بمثل، والفضة بالفضة وزنا بوزن، مثلا بمثل، فمن زاد أو استزاد فهو ربا.

Exchange gold for gold on equal weight equivalently and exchange silver for silver on equal weight equivalently, whosoever increases or seeks an increase, then it is usury/interest’’[6]

و عن علي انه سمع رسول الله صلي الله عليه و سلم لعن اكل الربوا و موكله و كاتبه و مانع الصدقة و كان ينهي عن النوح.

Sayyiduna Ali Radhiyallahu anhu narrates that he heard Rasulullah Sallallahu Alayhi Wasallam cursed the one who consumes interest, deals in interest, records interest, abstains from paying Zakaat (alms) and he used to prohibit excessive mourning”[7]

عن عبد الله بن حنظلة غسيل الملاءكة قال قال رسول الله صلي الله عليه و سلم درهم ربا ياكله الرجل و هو يعلم اشد من ستة و ثلاثين زنية

Sayyiduna Abdullah Bin Hanzalah Radiyallahu Anhuma narrates that Rasulullah Sallallahu Alayhi Wa Sallam said: One dirham of interest/usury which a man consumes while he is aware (of it being interest), is more severe than thirty six counts of adultery”[8]

In conclusion from the above it is clear that Interest / Usury is (Haraam) impermissible in Islam. By abiding to the laws of Shariah one would entail Barakah (Blessings) in one’s life and by violating the laws of Shariah one would draw the wrath of Allah Ta’ala by which one would see adverse effects in one’s life.

Should you wish to purchase a house, we would advice you with an alternative Islamic Finance scheme.

And Allah Ta’ala knows best
Mufti Luqman Hansrot
Fatwa Dept.

www.efiqh.com



[1] http://en.wikipedia.org/wiki/Mortgage_loan

[2] http://en.wikipedia.org/wiki/Foreclosure

[3] Surat Al-Baqarah, Verse 275

[4] Surat Al-Baqarah, Verse 278

[5] Surat ‘Āli `Imrān, Verse 130

[6] (Saheeh Muslim, Darul Ihya, Vol 3, Pg 1212)

[7] (Mishkaat ul Masaabeeh, Maktaba Islamiya,Vol 2, Pg 855, No 2807)

[8] (Mishkaat ul Masaabeeh, Maktaba Islamiya, Vol 2, Pg 859, No 2825)

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