RSS FeedsSharia mortgages on the rise
20/02/2008
Latest mortgage news shows that Sharia compliant mortgages are becoming more and more popular and growing within UK finance.
A leading provider of Sharia compliant mortgages commented “The UK market continues to evolve and Alburaq has approved over £100 million worth of mortgage business in the last 12 months and is set to see the total market grow to over £1 billion by 2009,”.
Sharia compliant mortgages have been specifically designed to allow the Muslims within the UK to become homeowners without breaking any religious laws that apply to them.
According to Islamic laws it is forbidden for Muslims to pay interest on any borrowings, but the concept of Sharia mortgages works on a repayment structure where the lender is the landlord and the borrower pays an agreed amount of rent. These types of mortgages work very similar to interest only mortgages, however legally and contractually they are very different and the product bears no payment of interest.
In addition, Sharia mortgages also need to ensure that the mortgage provider is purchasing the property with financial resources that are from permissible sources.