Fatwa

Taking out a mortgage

Question

Assalam Alikum,

I have a question about a potential house we would like to buy. The house is 450,000 K and we are going to put down 200,000 K. This leaves 250,000 K to finance. If we were to take out a mortgage for 250,000, but we are going to request a 10 year term with a fixed rate, in which the interest rate does not fluctuate and it is known from the start to the end. And we would’ve paid off the full amount within the 10 years, is this considered permissible?

Answer

In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.

This is not permissible as one is still repaying an amount higher than initially borrowed. This is interest. You may consider shariah complaint alternatives which would function in a similar manner.

And Allah Ta’āla Knows Best

Mufti Bilal Pandor

Concurred by
Mufti Muhammad Patel

Darul Iftaa Mahmudiyyah
Lusaka, Zambia

www.daruliftaazambia.com