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Mortgage Vs Loan For A House
Assalamualaikum
Getting extra money in mortgage is halal and is not interest. But if i give loan to someone and he himself buys a house, now the same thing as mortgage is happening, and now if on that money i ask for extra would it be halal? (Like there are special house loans thing in banks)
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2 Replies
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Mortgage Vs Loan For A House
updated 3 years, 8 months ago
3 Members
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2
Replies
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First scenario is fine while the second scenario would result in riba.
It is not the same thing with respect to results of both transactions. In first scenario, house need not be reproduced and can be confiscated anytime by the bank in case of default, while in the second scenario, principal amout of loan plus the interest charged over that amount both need to be reproduced.
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These two cases are quite different. In the second case, the person did not mortgage his house to you. So you cannot demand extra on your loan.
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