Coming Soon,Assiniboine Credit Union Introduces Islamic Mortgages

Assiniboine Credit Union Introduces Islamic Mortgages
CJOB News Team reporting

www.cjob.com...
Better late than never. The Assiniboine Credit Union is introducing Islamic Mortgages to Manitoba. The President and CEO of UM Financial Omar Kalair tells says the product has been very popular in England and the U.S., but has been slow to be introduced into Canada. He tells CJOB, to comply with Islamic tradition, you pay rent instead of interest:

www.cbc.ca...

For Muslim Believers only I dont trust CJOB news to much.



Do you now believe islam is taking over?

[edit on 5-5-2010 by Agent_USA_Supporter]

Quoting a poster on a site you linked.

If It sounds like interest and looks like interest it's interest !

Basically the "Islamic loan" is a for profit loan.

This is just a nice fancy way to twist the word "interest" around into something else.

Basically you still end up paying the bank a profit.

It's a scam.

reply to post by muzzleflash


As much as a scam as any usury scheme...

Rent to own is a fancy way of saying mortgage.

Because you don't own the house when you have a mortgage either, the bank does... You are essentially renting to own.

reply to post by GreenBicMan


Isn't that off topic?
So your saying i am dumb, haven't you even bothered of reading the news articles?

It also stated it was first introducing it to see how it will go.

The plan was developed with the help of Islamic religious scholars in Canada and the U.S., the credit union added.

[edit on 5-5-2010 by Agent_USA_Supporter]

Personally, I think that if religious law - whether it is Islamic or any other religion - does not permit the payment of interest, then this arrangement sure seems fishy to me. Replacing the term "interest" with "profit" is patently ridiculous.

I am no Islamic scholar, but if I were, I would definitely say that these arrangements would fall outside of the law against paying interest. It's pure gimmickry.

If I were to guess, the prohibition against paying interest is designed to protect the devout Muslim from being harmed - in financial terms - from the dangers of usurious interest rates. Not a bad idea at all - even if you aren't a Muslim.

What the community should do, instead, is pool community resources to build family homes. Kind of like Habitat for Humanity. That way you skip out on the whole gimmickry with these silly "interest free" loans.

reply to post by Agent_USA_Supporter




So what about the link?

I don't understand how Muslims are taking over? Who cares what they do anyway, this definitely has no advantage over what you can do currently.

And no, I don't think dumb is pushing it either. It is pretty dumb that you are even concerned about this IMO. Sorry mang'

So if they are strictly following Muslim law then you should only have to pay for seven years then the debt is forgiven.

reply to post by Agent_USA_Supporter


Lol.. this loan cracks me up to no end..

In Islam, Usury is considered an evil (Usury is the act of charging interest) ... so a firm believing Muslim may not take out a loan of any kind, nor can he loan money for profit.

To get this mortgage within Islamic "tradition" ... the bank says "We give you money for the home, and you pay rent ...... but we own the home" .. So the faithful Muslim will pay the "rent" while gaining no equity because it's essentially a "interest only mortgage" ...... you know.... one of those subprime types.

They are doing a highly unethical business practice under the guise of religious belief.. quite disgusting.

Islam is, by no means, a perfect system, but they do have some interesting and some beneficial points to make.

I actually agree with Islamic business loans as it causes the "lender" to look more closely to the business model or venture. They share in profits and they share in the loss as a normal business partnership would be.

As for the home loan, they do not loan the money. They are not allowed to loan money for profit, but they may choose (at a party's behest) to purchase a property. They then resell the property to the new owners and allow them to pay for it in installments.

There are generally no penalties for late payment either.

I wouldn't mind some of the Islamic banking ideas to float over here personally. When one does not seek information but rejects that which is different, they become bigoted and/or willfully ignorant.

Peace
KJ

Yeah right.

When they ask you to pay $1000 each month for a house that is only worth $800 each month, then that extra $200 is the ''interest'' part. It is a little lie to the little children.

Cabaret, you are exactly right. This Islamic loan, as described in the link given, is still 100% usury. It's pure gimmickry.

As I stated before, what really needs to happen is for the Islamic communities to pool their resources to build homes interest-free. Kind of like Habitat for Humanity - where homes are built for people that have put in so many hours of sweat equity building other people's homes. Rely on donations and private monies to fund the actual purchase of home building materials.

Another alternative would be communal living.

Homes prices are still quite inflated. Even with the crash in real estate prices, most people still require a mortgage in order to buy a home.

reply to post by Agent_USA_Supporter


This is not new and has been going on in the investment industry for quite some time, particularily with respect to mutual funds.

These products are called Shiria loans and like Shiria mutual funds are prohibited from holding certain instruments, mostly instututions that factor interest payments into their products.

It is no difference than eco-friendly funds or funds which purposefully do not hold alcohol or tobacco companys.

With a Shiria fund/investment product there is an established Shiria board that on a regular basis reviews the product and ensures that it is accordance with Shiria law. A different body is created to review other forms of socially screened funds.

There is no problem with this. If folks want to limit or eliminate their exposure to certain firms in their investment decisions they have every right to do so.