Question:

Is it permissible to take an interest bearing loan to buy your first home?

Answer:

In the Name of Allah, the Most Gracious, the Most Merciful.

Islam strictly prohibits interest bearing loans and transactions. Severe punishments have been mentioned in the Holy Quran and Hadith for engaging in interest bearing transactions. It is mentioned in the Quran:

 

يَا أَيُّهَا الَّذِينَ آَمَنُوا اتَّقُوا اللَّهَ وَذَرُوا مَا بَقِيَ مِنَ الرِّبَا إِنْ كُنْتُمْ مُؤْمِنِينَ(278) فَإِنْ لَمْ تَفْعَلُوا فَأْذَنُوا بِحَرْبٍ مِنَ اللَّهِ وَرَسُولِهِ وَإِنْ تُبْتُمْ فَلَكُمْ رُءُوسُ أَمْوَالِكُمْ لَا تَظْلِمُونَ وَلَا تُظْلَمُونَ (279)

 

“O you who believe, fear Allah and give up what remains of Riba (interest), if you are truly believers. But if you do it not, then beware of war from Allah and His Messenger; and if you repent, then you shall have your principal; thus you shall not wrong nor shall you be wronged.” (Quran 2:278-279)

 

The Prophet (Sallallaahu alayhi wa sallam) also gave grave warnings to those who take part in interest bearing transactions. In a hadith the Prophet (Sallallaahu alayhi wa sallam) said:

 

عن أبي هريرة قال : قال رسول الله صلى الله عليه وسلم  « أربعة حق على الله أن لا يدخلهم الجنة ولا يذيقهم نعيمها مدمن الخمر وآكل الربا وآكل مال اليتيم بغير حق والعاق لوالديه » « هذا حديث صحيح الإسناد ولم يخرجاه وقد اتفقا على خثيم » - - المستدرك للحاكم ،كتاب البيوع ، رقم الحديث: 2220

 

“Four people are such that Allah will not admit them into paradise nor will they be allowed to taste its bounties. They are: one addicted to wine, one who devours interest, one who devours the wealth of the orphan without any right and one who is disobedient to his parents.”  (Mustadrak Haakim)

 

 

Anything attained through interest bearing transaction will always be devoid of blessings as the Messenger (Sallallaahu alayhi wa sallam) informed us:

 

عن ابن مسعود رضي الله عنه عن النبي صلى الله عليه وسلم قال : « ما أكثر أحد من الربا إلا كان عاقبة أمره إلى قل » « هذا حديث صحيح الإسناد ولم يخرجاه » - المستدرك للحاكم ،كتاب الرقاق، رقم الحديث: 8006

“No one ever amasses anything from Riba except that its final outcome is loss.” (Mustadrak Haakim)

 

Allah Ta’ala promised the same thing in the Holy Quran:

 

يَمْحَقُ اللَّهُ الرِّبَا وَيُرْبِي الصَّدَقَاتِ وَاللَّهُ لَا يُحِبُّ كُلَّ كَفَّارٍ أَثِيمٍ

 

“Allah will deprive Riba (interest) of all blessing, but will give increase for Sadaqat (charity). And Allah likes not the disbelievers and sinners.” (Quran 2:276)

 

عن عبد الله ، عن النبي صلى الله عليه وسلم قال : « الربا ثلاثة وسبعون بابا ، أيسرها مثل أن ينكح الرجل أمه ، وإن أربى الربا عرض الرجل المسلم » « هذا حديث صحيح على شرط الشيخين ولم يخرجاه »

 

Abdullah (Radiyallahu Anhu) narrates that Rasulullah (Sallallaahu Alaihi Wa Sallam) said, “Interest has seventy three doors (i.e. levels). The least is like committing adultery (zina) with ones mother.” (Mustadrak Haakim, Ibn Maajah, Shu’abul Iman)

 

عن سمرة بن جندب رضي الله عنه قال قال النبي صلى الله عليه وسلم رأيت الليلة رجلين أتياني فأخرجاني إلى أرض مقدسة فانطلقنا حتى أتينا على نهر من دم فيه رجل قائم وعلى وسط النهر رجل بين يديه حجارة فأقبل الرجل الذي في النهر فإذا أراد الرجل أن يخرج رمى الرجل بحجر في فيه فرده حيث كان فجعل كلما جاء ليخرج رمى في فيه بحجر فيرجع كما كان فقلت ما هذا فقال الذي رأيته في النهر آكل الربا

 

Samurah bin Jundub (Radiyallahu Anhu) narrates that Rasulullah (Sallallaahu Alaihi Wa Sallam) said, “Tonight I saw two men coming to me. They took me to the holy land. We walked until we came to a river of blood in which there was a man standing. At the middle of the river was a man who had a rock infront of him. Whenever the man in the river tried to get out of the river, the other man would throw the rock at his head and it would repel him and push him back to where he was before. Every time he tried to escape, the same thing would happen. I asked, “What is this?” He (the angel) said, “The man you see in the river used to engage in interest bearing transactions.”     (Bukhari)

 

عن أبي هريرة رضي الله عنه عن النبي صلى الله عليه وسلم قال اجتنبوا السبع الموبقات قالوا يا رسول الله وما هن قال الشرك بالله والسحر وقتل النفس التي حرم الله إلا بالحق وأكل الربا وأكل مال اليتيم والتولي يوم الزحف وقذف المحصنات المؤمنات الغافلات

 

Abu Hurairah (Radiyallahu Anhu) narrates that Rasulullah (Sallallaahu Alaihi Wa Sallam) said, “Stay away from the seven that destroy (i.e. ones good deeds).” They (the companions) said, “Oh Rasulullah (Sallallaahu Alaihi Wa Sallam), what are they?” He said, “Associating partners with Allah (shirk), magic, killing a soul that Allah has prohibited without right, engaging in interest bearing transaction, devouring the wealth of the orphan, fleeing on the day of Jihad and slandering naive, chaste Muslim women.” (Bukhari)

 

عن أبي الصلت عن أبي هريرة قال قال رسول الله صلى الله عليه وسلم أتيت ليلة أسري بي على قوم بطونهم كالبيوت فيها الحيات ترى من خارج بطونهم فقلت من هؤلاء يا جبرائيل قال هؤلاء أكلة الربا

 

Abu Hurairah (Radiyallahu Anhu) narrates that Rasulullah (Sallallaahu Alaihi Wa Sallam) said, “On the night of Mi’raaj (ascension to the heavens) I came across people whose stomachs were (huge) like houses in which there were snakes which could be seen from outside their stomachs. I said: Who are these Oh Jibreel?. He replied: These are those who devoured (wealth and possessions attained through) interest.” (Ibn Maajah, Musnad Ahmad)

 

عن أبي سعيد الخدري رضي الله عنه ، قال : قال رسول الله صلى الله عليه وسلم : « الآخذ والمعطي سواء في الربا »

 

Abu Saeed Al-Khudri (Radiyallahu Anhu) narrates that Rasulullah (Sallallaahu Alaihi Wa Sallam) said, “One who takes interest and one who gives interest are equal (in sin).” (Sahih Muslim, Mustadrak Haakim)

 

From the abovementioned ahaadith and Quranic verses, it becomes clear that engaging in interest bearing transactions and loans is strictly prohibited in Islam. Therefore, it is not permissible to take an interest bearing loan in order to buy a house.

 

Yes, if there is a Shariah compliant home finance product available where you live that has been verified and certified by competent scholars who are renowned for their expertise in Islamic finance, then you may make use of such finance product.

 

And Allah knows best.

Mufti Faizal Riza
21/9/2011
Darul Ifta Australia
www.mufti-online.net

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