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Fatwa CenterTaking Mortgage to Buy A House
Question
Assalamualaikum. Iam an indian citizen living in Netherlands for last 3 years as part proffession and planning to continue here since we have nearby islamic schooling for children and mosque also. My question is about Mortage for housing. There is no Islamic banking in this country but the non islamic mortage intrest is almost very low as less than 2%. Since its very expencive, and inflation we cant save that much amount of money to buy in future. Is it permissible for me to take this non islamic mortagage to buy a normal, living house ? As i know riba is serious , so am really confused what should i do. Kindly advice us as we dont want to spoil our duniya for aakhira. Jazakallah khair.Assalamualaikum
Answer
All perfect praise be to Allah, The Lord of the Worlds. I testify that there is none worthy of worship except Allah, and that Muhammad 
is His slave and Messenger.
Mortgage given by usury-based banks is a prohibited transaction that is based on giving a loan for a usurious interest. By virtue of this mortgage, the bank mortgages the house for which the borrower takes the loan until the debt plus the usurious interest are repaid. In case the indebted person is unable to pay off the debt on time, the bank has the right to sell the estate to get its money.
In the 2nd conference on the works of banks held by the Islamic Research Academy, Muslim scholars unanimously issued the following Fatwa:
“Interest on all kinds of loans is prohibited usury whether the loan is used for consumption or production. Usury in these loans is prohibited, regardless whether it is much or little. Giving usurious loans is a prohibited act that is not allowed, either under need or necessity. In the same way, taking usurious loans is also prohibited and it is still a major sin unless there is a necessity to do so. In truth, the responsibility of evaluating necessity lies totally on the shoulder of the person.” [This Fatwa is quoted form the Islamic Fiqh Academy journal]
As such, you are not allowed to take a mortgage, even if the percentage of the usurious interest is very little, as long as you are able to have a house – even through renting and with no unbearable hardship.
For more benefit on the ruling on mortgage, please refer to Fatwa 81377.
Allah knows best.
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