The charging of exorbitant interest rates or fees when lending money is prohibited in Islam and is the reason why most Low-income Muslims don’t own property.
Mayor Ed Murray of Seattle, Washington recently announced his plans to offer Sharia Law-compliant home loans. This is in line with his efforts to increase and make housing more accessible to Seattle residents especially those who are low income earners including marginalized groups and communities.
Usury or the charging of exorbitant interest rates or fees when lending money is prohibited in Islam. And the rules do not only apply to lenders but borrowers as well. Borrowing money, applying for loans, and paying debts with high interest rates is also prohibited in the Sharia Law.
This is the reason why most Muslims in Seattle and across the United States who are not earning much or don’t have the money to buy property in cash never avail of mortgage products. It’s simply because of their religious convictions.
Sharia Law in Seattle allows Muslims to get home/business loans w/o having to pay interest on their loans! WTF?
— Cookie (@Cookiemuffen) July 23, 2015
The proposal will still go through the city council for approval. And to make it possible, the city is planning to meet with financial institutions, lenders, Muslim and other community leaders to be able to devise a plan that will be acceptable for all parties.
The Council on American-Islamic Relations reacted positively to the proposal. According to its executive director Arsalan Bukhari, there are about two hundred Muslim residents in Seattle that avoid applying for home loans because of their religion. It would be great news for them and others who choose to work and live in the city.