|
Devon Bank, a fixture in Chicago
since 1945, is experimenting with Rent to Own to avoid the
Islamic prohibition against interest.
Strict interpretation of Islamic Law prohibits Muslims from
charging or paying interest, this can be an insurmountable
hurdle when buying big-ticket items. In order for fundamentalist
Muslims to purchase a home, for example, they must either save
the cash or borrow from friends and relatives at no interest.
Devon bank has developed a mortgage vehicle called Ijara
that solves this problem.
The 'Ijara', pronounced E-jar-ah, is described by the bank as
being similar to a rent-to-own transaction. The bank buys the
house, builds in it's profit, and the homeowner makes payments
for a specified term until he owns the home.
Recommended Reading
The Chicago Sun Times published this article (Blending banking
and Islam) detailing the issue.
|
RTO Online is the official channel for Rent-to-Own Industry News and the
only independent source of news for the rent-to-own, rental-purchase,
lease-purchase trade. RTO Online (Rent to Own Online) represents the choice
of the entire RTO Industry for trusted information, as it happens. |
|
Tell us what you think
Rate the article at the top of this page |
|
|
|
|
