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Q784: Amanah mortgage from HSBC

Assalamualaikum w w

HSBC provide amanah finance which is supposed to be shariah compliant.

But I am a bit wary of taking their word for it.

They provide a mortgage which you can repay over a number of years.. And until that is paid off you also pay rent.

Now the rent is reviewed every 3 months… This is the bit I am unsure about… If the rent goes up and down based on the interest rates, does that still keep the mortgage shariah compliant?

Salaams,

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Walaikumussalm w w

You are quite right in your doubts. When they keep reviewing and changing every 3 months, then it is definitely interest based. You can hold your ear from one side or the other, they are both the same.

Plus, you end up paying more on this mortgage than a conventional one. Therefore my advice would be to avoid it.

Buy cash or borrow from family and friends, or buy a small affordable house rather than a large one.

If you cannot afford to buy with your own money, nor can you undertake a private interest-free loan, we would advise you to adopt Taqwa, and to continue living on rent. Insha Allah, Allah will grant you Barakah and pave some way out for you.

Hazrat Umar R.A said,

“فَدَعُوا الرِّبَا وَالرِّيبَةَ”

“Leave interest and anything that has the doubt of interest. (Ibn Majah)

The Hadith says

دع ما بريبك الي ما لا بريبك
“Leave that which creates suspicion and take which is free from doubt”

And Allah is All Knowing

Many people live in rented accommodation. Hazrat mawlana Ahmed Ali lahori ra spent his whole life in a rented property. I am in Vancouver at the moment. My host has been living in this rented house for 20 years, with his parents, family and brother. He has always refused offers of mortgage and finance.

3 Responses

  1. shoaib

    Assalaamu alaikum wa rahmatullahi wa barkatuh
    Respected shaykh
    as this question seems to be Q786, please could you clarify the signifcancy of the no. 786
    fa jazakumullahu ahsan jaza fiddarain

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    Walaikumussalam w w

    Numbers cannot deputise the original.

    Full Bismillahir Rhmanir Raheem should be used.

    Shaykh Yunus Saheb has mentioned this in Al-Yawaaqeet.

    Wassalam

  2. Asslamo Allaikum,

    Amanah (HSBC) Finance is actually developed and approved by Shaykh (Mufti) Taqi Usmani (HA)

    http://albalagh.net/qa/0015.shtml

    Shaykh (Mufti) Dr Mohamed Imran Ashraf Usmani (HA) is actually on the Shariah board and supervises and approves these matters:

    http://www.assetmanagement.hsbc.com/uk/globalfunds/amanah/central_shariah.html

    *Just bringing the matter to your attention, in case you had missed it during your research for your answer*

    Requesting your duas.

    Jazakullah Khairun

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    Walaikumussalam w w

    Jazakallah for the links. I have seen them.

    Mufti Taqi saheb’s contribution towards Islamic finance is second to none. May Allah reward him immensely for his efforts. Ameen.

    However, there are muftiyaane kiraam in Pakistan, as well as elsewhere, who do not agree with some of his researches. Especially in Binnoritown.

    Another thing is that his name has been misused and abused by many people. When he recently came for the Sufi study program, he was invited by some people from the financial circle. He refused, simply because they had done things which he could not agree with.

    Also research is an open field and my opinion is that all Islamic finances should be avoided. They are labelled Islamic but there is no Islamic spirit in them.

    Islam teaches that a rich person should help the poor by lending them money which is sitting there doing nothing and the rich should strive in earning reward from Allah swt.

    Even Members of the Jewish community in Madina shareef would help Rasulullah sallallahu alayhi wasallam and the sahaba by giving them interest free loans. Their reward would be given by Allah in this dunya and in many cases in the form of hidayat.

    When we study the finance circle of today, the aim from the beginning is to make money from the hardworking poor people. There is no spirit of supporting the needy people.

    Muwaasaat, (caring nature) has disappeared. Greed and Zulm have replaced it.

    Read the verses of Surah Baqarah again and again, and you will understand the many reasons behind the prohibition of Riba.

    Read the final verse of the ruku’ which indicates that extending the time of repayment is wajib and being charitable by letting go of the loan is desirable.

    Read the Hadith of Ibn majah which indicates that the reward of Sadaqah is multiplied ten times but the reward of giving loan, (interest free) is multiplied eighteen times.

    We can’t use the Hadith of Bilal radiallahu anhu of selling two saa’and buying one saa’ of dates. This is because there, the value of both transactions is the same, whereas here, in finance, the repayment is multiplied by many folds.

    You could call it halal finance but not Islamic finance.

    Allah knows best

    Wassalam

  3. Ismail Mayat

    Asalamalykum sheikh,

    What should we do if we have already taken out an amanah mortgage? Unfortunately due to circumstances paying back the whole amount is not possible?

    Jazakallah

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    Walaykumussalam w w

    Don’t overspend, avoid holidays, save as much as you can and pay it off as quickly as possible

    Seek help from family & friends where possible

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