Mu' meneen Brothers and Sisters,

As Salaam Aleikum wa Rahmatullahi wa Barakatuh.  (May Allah's Peace, Mercy and Blessings be upon all of you)

One of our brothers/sisters has asked this question:

Asalaamwalaiqum:

Dear brother, I am looking forward to purchase a flat by taking home loan from a bank. Right now, I do have a home but it is in a bad condition and I was thinking about shifting to a flat. But I came to know that if you go for loan on interest from any bank it is haram in our religion, whatever the cause may be. But one of my friends also told me that you can go forward for home loans as it has been permitted and muftis have also given their consent on it.

But then too. I am in doubt for whether or not I should go forth for the loan as it has been said that whoever gives or takes interest then Allah and his messenger declare war on him and I do not want this to happen. Previously also I had asked the same question but there was no reply.

It was said to me that your answer will be pasted and all, but I could not find the reply. Please please this time send me a copy of my reply on my mail. This is my request to you and I am really worried on the above matter. Because if you let me know than I shall have a proper stand on this matter and shall also inform my brothers of the same as right now I do not have quite an explanation. Please please reply on my email id.

Your brother

(There may be some grammatical and spelling errors in the above statement. The forum does not change anything from questions, comments and statements received from our readers for circulation in confidentiality.)

Answer:

House on Loan Mortgage Interest

In the name of Allah, We praise Him, seek His help and ask for His forgiveness. Whoever Allah guides none can misguide, and whoever He allows to fall astray, none can guide them aright. We bear witness that there is no one (no idol, no person, no grave, no prophet, no imam, no dai, nobody!) worthy of worship but Allah Alone, and we bear witness that Muhammad (saws) is His slave-servant and the seal of His Messengers.

Allah says in the Holy Quran Chapter 2 Surah Baqarah verse 274-276:

But those who devour ‘riba’ become like the one whom Shaitaan has bewitched and maddened by his touch. They have been condemned to this condition because they say, “Trade is just like ‘riba”, whereas Allah has made trade halaal and ‘riba’ haraam. Henceforth, if one abstains from taking ‘riba’ after receiving this admonition from his Lord, no legal action shall be taken against him regarding the ‘riba’ he had devoured before: his case shall ultimately go to Allah. But if one repeats the same crime even after this, he shall go to Hell, where he shall abide for ever! Allah deprives ‘riba’ of all blessing and develops charity, and Allah does not like an ungrateful, sinful person.

Allah says further in the Holy Quran Chapter 2 Surah Baqarah verse 278:

O Believers!, fear Allah and give up that ‘riba’ which is still due to you, if you are true believers. But if you do not do so, then you are warned of the declaration of war against you by Allah and His Messenger!

Allah says in the Holy Quran Chapter 4 Surah Nisa verse 161:

That they took ‘riba’, although they were forbidden. And that they devoured men’s substance wrongfully. We have prepared for those among them who reject faith a grievous punishment (of Hell Fire)!

Al-Tirmidhi Hadith 2829 Narrated by Ali ibn AbuTalib

Ali heard Allah's Messenger (saws) invoke the curse of Allah on those who took ‘riba’, those who paid it, those who recorded it, and those who refused to give sadaqah.

Allah and His Messenger (saws) have strongly condemned the concept of ‘riba’ and declared it absolutely haraam for the believers. Without an iota of a doubt, the concept of conventional bank ‘interest’ is a form, manifestation, and part of ‘riba’ or usury, and thus any transaction based or done on the concept of ‘interest’ would be considered absolutely forbidden for those who sincerely believe in Allah and the Last Day.

If taking a mortgage for buying a home or for any other reason involves the payment of ‘interest’, such a transaction would be deemed haraam in the sight of Shariah, and any believer who sincerely believes in Allah and the Last Day must abstain from it.

Dear and Beloved Brother, Alhamdolillah, there are many Islamic Financial Institutions available in the world today who lend money to home buyers in accordance with the principles of Shariah; and it would be prudent for the believers to approach such legal institutions and save themselves from getting involved in ‘riba’, which has clearly been declared haraam by Allah and His Messenger (saws).

Beloved Brother in Islam, regardless of how many ‘modern’ muftis have tried to convey that the concept of present-day bank interest is not forbidden in Islam; we assure you from the Quran and the Sunnah that every type of ‘interest’ is a form and manifestation of ‘riba’, and every type of ‘riba’ is absolutely forbidden to the believers who sincerely believe in Allah and the Last Day.

My beloved brother, if you abstain from dealing in the ‘haraam’ only because you fear Allah, it may be that your Lord Most Gracious will give you a palace made of pearls and precious stones, which will be yours to abide therein for ever in your eternal and everlasting life of the Hereafter. I assure you brother, that a measly house in this transient earth is no comparison to the magnificent Palaces the Lord will provide to those who fear Him in the Hereafter, if only one could bring himself to make this bargain of a sacrifice for their Lord!

Whatever written of Truth and benefit is only due to Allah’s Assistance and Guidance, and whatever of error is of me. Allah Alone Knows Best and He is the Only Source of Strength.

Your brother and sincere well wisher in Islam,

Burhan