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Is Traditional Mortgage Instead of Islamic Financing Allowed?

09 September, 2021
Q As-salamu `alaykum. Hope you are doing well. I have different opinions from different people regarding having own house. Some people say that since you are living in Canada, so you have to follow the same way buying a house through mortgage if you don’t have that much amount. Other people say Islamic financing but I found they charge very huge amount which is more than what bank takes. Kindly, help me find out the best way of purchasing.


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:

1- Muslims are ordained to adhere to the Quran and the Sunnah everywhere and at all times.

2- As for having a house, if Islamic finance is not available, it is permissible to have conventional finance with some conditions for families who need housing and could not afford to buy it.

In his response to your question, Prof. Dr. Monzer Kahf, Professor of Islamic Finance and Economics at Qatar Faculty of Islamic Studies, states:

Muslims, wherever they live, are called by the Quran to follow the guidance given by Allah. One of these commandments is the prohibition of riba (interest).

Therefore, riba should be avoided all the time and anywhere including being in Canada or the USA.

Muslim families in the West have rights to own their own homes if they need them. When Islamic finance is not available, conventional finance is permissible for families who need housing.

If Islamic finance is much more costly than non-Islamic finance, I consider the overcharging Islamic finance as non-existing.

Allah Almighty knows best.

Editor’s note: This fatwa is from Ask the Scholar’s archive and was originally published at an earlier date.

About Prof. Dr. Monzer Kahf
Dr. Monzer Kahf is a professor and consultant/trainer on Islamic banking, finance, Zakah, Awqaf, Islamic Inheritance, Islamic estate planning, Islamic family law, and other aspects of Islamic economics, finance, Islamic transactions (Mu'amalat). Dr. Monzer Kahf is currently Professor of Islamic Finance & Economics at the Faculty of Economics and Management, Istanbul Sabahattin Zaim University, Turkey