Wa `alaykum As-Salamu wa Rahmatullahi wa Barakatuh.
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
In this fatwa:
If a person is not able to rent a suitable house for himself and his family in a proper location or the rent is too high, in that case he can purchase the house with a mortgage.
In his response to the question you posed, Dr. Muzammil H. Siddiqi, former President of the Islamic Society of North America, states:
A Muslim has to be very cautious against getting involved in any sort of usurious transactions. The Messenger of Allah (peace be upon him) cursed the one who consumes riba (usury) and the one who pays it.
The committee of scholars met in Detroit in 1999 and issued a statement explaining the law of necessity in this case. You may refer to it.
Basically, it says that if a person is not able to rent a suitable house for himself and his family in a proper location or the rent is too high, in that case he can purchase the house with a mortgage.
Even in the case of permission, the scholars suggested that one needs to exhaust all the other possibilities of purchasing the house in a pure halal way.
For example, one can make an agreement with the seller to sell him the house at a higher price and he pays it in installments.
In the language of the Shari`ah, this is called al-bay` bil-ajal (purchase through deferred payment). Or there could be other similar methods that could be used.
If it is not possible to buy a home in any other way except through mortgage and one is in dire need, one can take benefit from this permission.
Allah Almighty knows best.
Editor’s note: This fatwa is from Ask the Scholar’s archive and was originally published at an earlier date.