How much do you know about Islamic financing? Whenever you are in the process of purchasing a house and securing a loan for the same, you need to ensure that you’re actually educating yourself about the various factors governing home financing in your area (city or state or country). You might as well have to keep certain religious factors in view while obtaining home loans as well.
You can own a home as a Muslim
Yes, if you are a Muslim then you are forbidden to accept or pay rates of interest—because the holy Quran treats it as an act of usury. You can add on to your wealth by means of trade but not by paying rates of interest. It is very important to ensure that you are acquainting yourself with various aspects of Islamic home loans before you are actually applying for a loan.
Since you are not supposed to accept or pay interest as a Muslim, you might as well think that buying that dream house of yours will remain an unfulfilled dream of yours. However, there is no reason to give up hopes or to despair since you can secure Islamic home loans. Even if you are residing in a foreign country, you will find banks that offer these loans without flouting the diktats of the Holy Quran.
Please ensure that you’re actually making yourself aware of the Ijara and Murabaha methods of Islamic home financing before you are applying. The Ijara method allows you to take a property on lease. The lease period may extend up to 25 years and during all these years you can actually continue paying rent instead of interests.
If you want you can buy the property at the end of the lease period. According to the Murabaha method of home financing the bank will sell you a piece of property at a fixed profit. The property is registered under your name.
Keep on educating yourself
The best way to ensure that you are not flouting the norms of your religion while buying a home – is by educating yourself about these loans. The more you educate yourself about this particular trait, the better informed you are about your choice of the home loan you are settling for. So, you should leave no stone unturned to learn more about the nuances of Islamic home financing. It will also help you find a compliant bank.