I'm aware there are 3 types:
1. I'll buy and then rent it to you and you pay it off slowly
2. I'll buy it and sell it to you for higher price
3. I'll buy and sell it loss/profit will be shared
3 and 1 are completely ok. But the most popular option that is 2 is sold as halal, But I'll argue it's anything but that.
The bank buys the house AND then you are required to buy the home at higher price.
The transaction up until the bank buys the house is not controversial. Whether bank or another seller owns it, it doesn't matter.
The problem is that bank REQUIRES you to buy the house before their purchase of it.
So instead of saying
- I'll give you $100
- you will give me back $150
BANK > $ > YOU > $$ > BANK
It basically adds an extra step
- I'll buy this box for you for $100
- But then you will have to buy it from me at $150
BANK > $ > HOUSE > YOU > $$ > BANK > HOUSE
Interest is paying more than what you owe. Which can be phrased, requiring you to pay more than what you got. Similarly, you got a house that is $100, and you will be required to pay $150.
Asked by Muhammad Umer
(540 rep)
Jan 14, 2023, 06:07 PM