Comments on: Sheikh Haitham al-Haddad: A Model for “True Islamic Finance”

By: asaleh

asaleh — Thu, 20 Aug 2009 07:43:49 +0000

is there such a facility available in melbourne?

By: Hood

Hood — Tue, 12 Sep 2006 13:50:50 +0000

salam Alaikum

Thanks Amir.
No doubt, they do seem to be the better choise out there.

By: Amir

Amir — Tue, 12 Sep 2006 12:13:58 +0000

Good point. Jazak Allah khair.

I suppose an alternative would be to not specify a time/place constraint and simply require people to become “members” of the institution before they can avail themselves of its services (i.e. musharaka or mudarabah). The amount they invest would be up to them, but when they come to formulate a musharaka agreement, the institute would assess their risk of default (of which their total assets, invested amount, length of the relationship, etc are a part) before agreeing to enter into a contract. In the mean time, their investment would be pooled with the other investments and used to fund other property purchases for other members — the profits then being distributed across the membership.

Anyway, leaving aside the issue of the two contracts in one, the actual musharaka contract (as described by the website) does seem substantially better than some of ijara wa iqtina offered in the West (where the ijara rate is pegged to commercial interest rates and given to rise every six months or so).

And Allah knows best.

By: Hood

Hood — Tue, 12 Sep 2006 11:24:41 +0000

if the stipulation is mentioned upon intial contract, that they will not go into a “Musharakah” purchasing of the house until you invest with them for a certain amount of time, then it is still two contracts in one. Time/place constraints in the future, the issue is what is said in the contract at the time of contract.
What you mentioned about the promise would be applicable if it was the other way around i.e. we’ll buy this house together and you promise me to invest later on, that may be acceptable according to some, but here the home owner is is need and he cant buy his house *until* he invests. So they are taking advantage of the need of the buyer, and the Messenger forbade “Bai’ al MuDtarr”
I havent read the contract just to clarify, but from the outset it seems something is wrong with that stipulation.
Allah knows best

By: Amir

Amir — Tue, 12 Sep 2006 01:08:39 +0000

Hood: If the contract to buy the house is formed one year after they invest and given there are a lot of unknowns preventing the contract from being made (not least of all that they don’t know what house they will buy or whether they will be able to afford to finance it in one year), then is it still two contracts in one? At best, it seems to me that they have a promise rather than a binding contract (in shariah terms).

By: Hood

Hood — Tue, 12 Sep 2006 00:23:11 +0000

“…is required first to invest his savings (buy shares) in Ansar Housing Limited (”AHL”) for a certain length of time. Afterwards, upon fulfilling all the application requirements of the institution…”
Is this not stipulating a contract within a contract, I.e. I will not go into partnership with you to buy the house you want, until you invest in my company for X number of days, months, years.
It would seem that the purpose is defeated.

By: dezhen

dezhen — Mon, 11 Sep 2006 09:44:11 +0000

That sounds like a very interesting approach, and quite different from what seems to currently be the norm…

By: Law Student

Law Student — Mon, 11 Sep 2006 04:26:45 +0000

I had once read a fatwa by Yusuf el Qardawi in which he stated: for Muslims in Western societies it is permissible to get a mortgage.