Ask Shaykh YQ #71 – Ruling on Mortgages & ‘Shariah Compliant’ Loans for Homes

Yasir Qadhi


Channel: Yasir Qadhi


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Episode Notes

With Dr. Hatem El Haj


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out of seven, me Paul Bailey in

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new he him first Blue Lake Erie

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Assalamualaikum warahmatullahi wabarakatuh Alhamdulillah wa salatu salam ala rasulillah. Who is he? He was happy he won't be back. So we are well aware that one of the biggest issues of consternation of controversy between the American Muslim community, frankly, the western Muslim community, is the issue of purchasing a house and the mechanisms for doing so whether one is allowed to avail oneself to the conventional mortgages, or whether it is permissible to go to the Islamic banking or is it even Islamic these particular banking systems that are out there the various enterprises that are giving these Islamic mortgages? Are they truly Islamic and halal or not. And I've been bombarded as

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all of the students of knowledge and scholars have been for so long, and I've been delaying giving a full and detailed response. And today in sha Allah Tada, we will begin with a very deep and intensive dialogue. And I have with me joining me today, somebody whom I consider to be not just a friend, but a mentor, and that is Dr. Hatem hedge doctor optimal hedge. Before I asked him to speak, I have to introduce him. And I'm sorry to be a little bit praising here so maybe doctor has him you can put some some earplugs on shout louder, but I consider Dr. Hatem and Hajj to be one of the models here is one of the sources of Islamic law and fatawa in this country. And on a personal note,

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when I myself am wondering about something or when I bounce ideas off of somebody, when I don't really know myself which direction to go about a filter issue or something, then the first person that I text is actually Dr. Hartman hedge. And of course, Dr. Hartman hedge isn't just a sheer horn at him. He's also a board certified in the pediatric and pediatrics by the American Board of Pediatrics pediatrics, so he's a practicing doctor as well. He has a PhD in comparative fifth from Lebanon from Jinan University. And he's also done an MA in shediac from the American Open University, and he's a professor, Assistant Professor in this department of the College of Islamic

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Studies at Mischka University. And of course, he's also one of the pillars of the American Muslim jurists Association. And so I welcome Dr. Hatem al Hajj, Sarah, what a kosher Santa

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Monica wants to know.

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cause for the introduction, I don't deserve it. And it is, you know, out of your humbleness I can laugh halen but

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you know, I just wanted to say that I don't deserve it.

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Charla, we would have a fruitful discussion tonight. This is a very complicated issue. And I will not deny it.

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Also, my reluctance to talk about this subject, because it's an I know of so many scholars throughout the Muslim world, that are extremely reluctant to talk about this subject.

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Because, as you are well aware that it's very complicated.

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The distance between the reality and what we aspire to, seems to be, like large, the, and we're trying as much as we can, we're trying not to be cynical. But we're trying also not to be naive. And that balance is very hard to strike. So May Allah subhanaw taala, guide our tongues in our hearts. So she's gonna you know, one of the reasons I'll be honest, that I've been very hesitant to speak about this issue. And anybody who's asked me, you know, for the last few years, I keep on saying and shall release something soon, is that I feel that this is a very sensitive topic, and anybody who gives a photo is going to have to bear the responsibility of that photo. And it is something that

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I've been very cautious about as your user for saying this is a very, very big issue. It's not a trivial matter. And one is just cognizant of the difficulties, as you said, between balancing between the needs of the Muslim community and between the great sin of interest and it's not a very easy and delicate balance. So I completely share with you the the sentiment of the seriousness of this matter and ask Allah subhana wa Taala, to guide all of us to that which is pleasing, and to forgive any mistake that we might make. So Hannah, before we jump into the issue of mortgages and whatnot, do you have any overall comment about the modern field of Islamic Finance, I noticed one of

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your speciality So overall, what do you have anything you'd like to say about the new field of Islamic Finance?

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the name itself Islamic Finance, I guess we're talking about providing funds for business ventures, then, yes, Islam, Islamic finance would not be oxymoronic in this case, because now we have the modaraba, which is profit sharing, we have different kinds of partnership like I now like full rein, partnership and other types of partnership that were meant to provide funds for business ventures. But when it comes to providing funds for a purchase of an item for use or consumption, like a house, car, etc, then that the I the name itself, the tension within the name is quite obvious, because provide funds for someone to purchase a an item, an object for use for consumption is in Islam is a

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benevolent act. It's called the part of the Hassan to goodly loan.

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And it is the know if no profit is expected to be made out of this. But nowadays, it is not possible basically, to fulfill the needs of all the people

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because of how the world has become because the expectations and the needs. And I don't want to be harsh on the people also and make it all about expectations or extravagance, there there are needs that need to be fulfilled, and we live within a financial system a global financial system that is insensitive to and inconsiderate of our values, not because they have to not because there is a conspiracy or not because they're legislate evil, and they want basically to propose our values, but because they they just not don't share our values. And we don't have the size of that Islamic finance.

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You know, in 2010, it was worth about $1.3 trillion. That may sound like a big number, but it is actually not that big. I heard that this is half

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of what a conventional bank, we you know, one of the largest conventional banks would be worse.

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Just one bank. So

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the idea here is we are Islamic Finance, is trying basically to instrumentalize some of the old contracts that we had, in a completely new environment and within a global financial system that is not particularly

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accommodating of our laws for our values. So that's the that's the difficulty.

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And, you know, we asked a lesson on China to, to make it easy for the people who embark on this task and embark on the task of

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you know, adapting these contracts to modern finance.

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I mean, so, Chef know, for our viewers, again, just a very, you know, brief,

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basic point of fit is that in our sheds, giving somebody a loan is never meant to generate profit. In fact, in the authentic hadith and the Sunnah of our Prophet sallallahu alayhi wa sallam said that whoever gives somebody a quarter Hassan alone shall get half of that money as a reward of giving sadaqa. So if you gave 10,000 loan, and you got 10,000, back, Allah will reward you 5000 as if you gave sadaqa to somebody. So this is the purpose is that in Islamic Sharia in fifth, giving somebody called Hassan so that's why it's called called escena. A good loan, it's a loan from the heart, do you give somebody something that is a genuine good deed, you expect a lot to reward you, obviously

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the modern notion of capitalism of the entire globe of Finance. It is not based on this principle. And so Islamic Finance, specifically and really Islamic economics, modern Islamic economics, it's actually a fascinating field. And, you know, as the chef said, we really should we feel sympathetic for the people involved. They're trying to make the best of a very, very different paradigm, this idea, and his paradigm is so different than the modern notions of the bank and of giving usurious loans. And of course, Muslims, all of us are connected to the modern world. We cannot live in an isolated bubble. So we have to make the best of a very difficult situation. So with that, Shana, why

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don't I ask you the setup setting up the entire stage here is that can you explain to us the Islamic notion of Riba

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And very briefly is the western notion of interest the same or different than the Islamic notion of Riba.

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Okay, from the law Well,

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you know, interest is more general than Riba in a sense and Riba is more general than interest in a sense. So, a river linguistically means increase. And then Islam there are like three different types of river.

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So, we have ribbon a CI, which is deferment and we have everybody out there which is exchange the river of exchange and I may, you know, clarify what this means. And then we have level four, which is that about increase

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or you may say that we have like rebel crude, which is the river of loans and rebel who you are, which is that above sales, Rebel Kuru is basically when you give a loan, can you expect a return on this loan like a profit to be made?

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When you are paid back,

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that is basically a rebel guru it is increase

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the increase that is

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a result of the deferment of the payment. And in Riba LBO it's completely different and that's why the concept of Riba is much larger than simply interest, because interest will accrue on the loan due to the deferment that is abundancia or rate of deferment. But then we have the concept of revenue which is river in sales, and revenue and sales results from

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exchange exchanging two items that are usually as items they were mentioned in 100 is an assignment for the profit or loss and I mentioned gold, silver, wheat, barley, dates and salt. He mentioned six items, and he said that you know, and that the honeys is long, but the prophet SAW Selim said example is that we said that Buddha will borrow your shirish tongue when we met Mr. And Miss Lisa and so, that was not figuratively Machito in Canada, then we add comenzado data for Kannada. So, the Prophet sallallahu Sallam said that you know these items when when gold was paid for by gold and silver for silver

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leaf or wheat, barley for barley dates for dates and sold for sold us to be like for Mike equal for equal.

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And if

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and if they are, they have different times, then you could sit you could sell us as much as you want like with an increase in the amount as long as it is hand to hand or immediate exchange.

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And then whoever offers an increase or asked for an increase has committed raber now, so so we have two different types of here of Riba that are basically implied and this is one of them is labeled follow which is increase. So when you trade for instance, wheat, for wheat, it has to be like for like equal for equal handpan. When you treat wheat for barley, it does not have to be equal for equal but it has to be hand to hand immediate exchange. When you trade when you trade I'm sorry, when you trade gold for silver or silver for gold.

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They don't have to be equal for equal but they have to be entered hand to hand and then gold and wheat. They don't have to be either. So there could be different there could be increased because they belong to two different groups. So remember, in that sense, is a very complicated matter. It is not only the

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interest that accrues on a loan because of the deferment, which is the common form of Riba that comes to mind when Riba is mentioned. But there is a whole genre of rebel view or river of sales, that is divided into two types, which is increase and exchange which is yet very, very odd. So rubber is much more general than interest. But

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in a sense,

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when people talk about interest, what when we when we when when people translate robots

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too, usually, usually also is a problematic translation because usury is exorbitant interest. Riba is not only exorbitant interest, Riba is any interest, but any interest that accrues on a loan of any interest that accrues on a loan. But if I said to you, if you asked, If you asked me for my laptop, and I sell you my laptop,

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for, like, let's say $500, and you say, I don't have the money,

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can we defer the payment until next month? And then I tell you, okay, if you will pay me next month, or if you will pay me installments over three or four or six months, then it is not $500 I would sell you the laptop for $700 to be paid over six months.

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Is that interest? Well, some people could say that I added interest, but now I add this is a commodity for price. And I am not basically this is not a loan, this is a sale. So can I add the time value to the price? In a sale? Yes, can I calculate if I if I calculate this, you know, on the basis of some formula in my mind, and I just say 7% and you know at a rate of 7%. And I can't even tell you how I calculated it and that is called the interest, but that is not haram that is my trip, I am selling you as my laptop and I am adding the time value not in a loan transaction. But in a sale transaction.

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As long as we agree on one final version of the contract, and certainly we cannot keep it open ended, where I tell you the price is 500. Now with a 7% interest. So if you pay over one year, it is less or two years. It's like if we finalize the contract and we have one form contract, now, the laptop would be for 700 over six months

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regardless of how I arrived at this number 10 regardless of whether I will tell you how I arrived or not, this is a permissible transaction and it is not usually it's so to continue with for chef enough. Basically what can be said here is that Riba the Islamic term is broader generally speaking than the western notion of interest because of a debt. And in our Shetty, there is a hadith and hopefully it is weak Hadith, but the concept is there. It is reported that the process of said but it is a weak Heidi it is most likely similar companion, that colocado in German fat and for whatever every single loan that generates any type of any type of benefit, it is considered to be Riba so

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when you stipulate in a loan that you're going to get a benefit from that loan, the majority of our scholars would consider that to be a type of Riba. Therefore, the interest that you know, we have people in this in this part of the world charged when they give a loan that is definitely a type of Riba by the explicit text of the Hadith. And before I move on, as well, I'd like to point out that there is no question that Riba is one of the major sins in our religion, a lot of xojo explicitly mentioned in the Quran that whoever takes it by It is as if it is declaring war against a lion is messenger. That having been said, we need to be a little bit careful and accurate. There is a genre

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of Hadith that seems to equate Riba with rubella. Jani doing Xena with one's mahad mo is one sister motherhood Avila and these ahaadeeth It is true that some of our later scholars consider them to be hesson. But the reality is that the majority of our scholars, including the ones that are really more reputable in this field, ignore them. Even though Josie and his mobile It better be Hatem. They all said that any of these narrations that seem to link the sins of Riba with doing Xena with one of your items. All of this is from the the basically the the storytellers it's not from the Prophet sallallahu it said, Oh, we don't need that genre of Hadith. We have enough to tell us that Riba is a

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very, very major sin. But next question, Shere Khan is that if you look at the text of the Quran, Allah azza wa jal always criticizes coluna Riba, those that are eating Riba. And in some of them as hubs, as you're aware, there is this distinction made between the sin of charging interest versus the sin of paying interest. And so some hubs and some scholars, they differentiate

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They say that the sin of charging is more than the sin of having being forced to pay as well in the Hadith in Sahih, Muslim and others that our Prophet system said that the one who gives it and the one who takes it and the one who witnesses and the triune, the one who writes the contract, they're all the same. So what is how do we understand the shareholder is the sin of charging interest, always the same as the sin of being forced to to pay it?

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Also concur with you on the genre of Hobbes talk about that, actually, not only equate river to center but make river worse than 36 doctors in our you know, making center with one's

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mother in law.

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I used to actually,

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hi, I used to sort of accept the one of the one version of the Saudis because of their authentication, I've shifted on Bernie, but then

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I had, I have a lot of difficulty justifying the Hudis the meaning of the Hadith myself, and I just was forcing myself to accept it. And I tried to figure out using sort of, like all my, like my sort of mental capacity to justify it somehow. But then, as you said, most of the scholars, most of the erudite scholars have considered the whole genre of Hades in this regard, weak, not traceable to the Prophet sallallahu.

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Then you have the

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javelins Muslim that you mentioned, where the Prophet sallallahu Sallam said, you know, a lot of low accurate a bomb killer who

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columns Allah, may Allah curse, the one who devours river consumer and the one who feeds I'm the one who takes it gives it and the one who takes it and the two scribes, or the two witnesses and describe, and he said that they are equal.

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I believe that, you know, I believe in the position of the scholars who said that they are equal in being partners in crime in a sense, so that had they not all done this, like had, you know, they're not helped each other doing this, that grunt at the crime needed all of those sort of members.

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But that is why they are equal because they, their participation in this crime was needed for the crime to be committed. Some of the scholars also said they are equal in the sense that they are equal and Aslan is Milan Dada. Dada is, so they are equal in in in being sinful, not in the magnitude of the sin. So in other words, they're their own sinful. That's what the prophet sallallahu Sallam meant to say, not equally sinful,

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in the sense of the magnitude of the sin itself.

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Some would say that sometimes the Prophet sallallahu Sallam will talk about the word of you know, if you believe that this is also an authentic tradition, if

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the word of saying in the mustard after Salatin something, for instance, until the sun rises, and then you pray to rock house. So you'll have the reward of a hot john hombre Tom matamata complete. Hi, john hamre. And

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so it isn't a bit difficult, you know, like because he had an MRI, there is so much that you do and we know there weren't 100 100 and you know the, so some people may say that it is encourage people and some people may say that now we will take it as the Prophet sallallahu Sallam said, but in ombre there is so much more you do than the basic 300 an hombre so ultimately it is not going to be the same, and certainly the exploiter and the exploited if the exploitation of people is one of the major analysts for the major causes of the prohibition of river for wisdoms of the division of labor, you cannot

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hold equal exploiter exploit now there's got to be a difference in

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precise precisely Xochimilco shares and you know, I remember you when you were speaking it reminded me something that I heard from our shared heaven earth I mean a lot of Hmong. He said to us in one of his lessons he complained of the and this is back in the 90s. He complained of the rising trend of VA he avoided he avoided ism of literalism that you just take a headache and you don't really understand

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And the filter behind it, and he decried this new trend that was, you know, arising in that timeframe. And as you pointed out, you're kind of this hadith. Generally speaking, pretty much, you know, the majority of the Shura and the fuqaha, they have understood it in a manner as you correctly pointed out that there is no way that the one who charges interest lumen what would one and wanting to increase his wealth, there is no way that the sin of that person is going to be the same technically, as the sin of the one who is, you know, in a very difficult situation and dire circumstances or even in a How does not necessarily alunos we're going to come to and he's kind of

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you know, forced because of the the lifestyle or the pressures of the world that he's living in to, you know, give an amount of interest, they cannot be the same based upon many other principles of the Shetty. So we don't just find one Hadith and then use it to Trump all the verses and all of the other ahaadeeth rather, we form a narrative that takes everything into account and the fact that for example, the Quran always criticizes those who eat Riba and also that we have other ahaadeeth lavado What are the other notions of this nature? So, it is definitely, you know, safe to say that a person who might be forced to give Riba because of certain circumstances may allow you to protect and

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forgive all of us, that there is no way that that sin would be the if it is even a sin would be anywhere near the sin of the one who is willingly for no reason other than greed, charging Riba on a loan that he gives somebody. So shafted. The next question that I have for you is that as you're aware, there are some voices in our times that claim that the conventional mortgage, the standard mortgage that is practice that is, you know, people avail themselves to in America, that it does not constitute a type of Islamic Riba. And they have their reasons for saying so that the bank owns that it doesn't give an actual that it's not an actual Riba loan and they have their reasons for for

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saying so. What is your position? is a mortgage an example of Islamic Riba?

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The mortgage is certainly an example of Islamic Riba. What happens in a conventional mortgage is that the bank gives you

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the money to purchase the house and gets back more over time. That's exactly you know, that's River. There is no merchandise here, that the bank acquires and sells to you, it is basically exchanging money for money was deferment and real exchange for an increase or a profit on the investor return on the investment. So that's, that's river

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from the Islamic perspective, and I am aware of the scholars who

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are trying to say that basically, you know, because you have, it is not

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one group of scholars saying the same thing, you have different groups, and some of them are saying that, you know, to deposit money in the bank is not Riba because the banking system is so advanced and they have their own calculations and they invested this money and because they are capable of forecasting the profit that they will make, they can tell you exactly how much profit you will be making, and so on and so forth. But there is another group of scholars who are actually trying to go back all the way and deconstruct

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the notion of Riba in modern times, particularly after Nixon, Nixon unlinked. The currency the American currency, which is the master see in the world, from the gold reserve and abandoned the gold standard, which started from the time of Roosevelt, but was completed by Nixon

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was started during the Great Depression, and now the currency is unlinked to the gold reserve. So some of the scholars are saying, you know, what, proof do you have that? Basically, the dollars and Sterling pounds and euros are used orius items,

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are you likening them to gold and silver? Why are you likening them to gold and silver. And then we start to get into technicalities, and there are three different that you know, even when it comes to Islamic financing, even though what comes to mind when you're trying to provide an Islamic product, there is a genuine, genuine solutions, genuine alternatives that are philosophically different and ideologically different from the content they can conventional products and there are technical differences. You're trying to

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Provide a product that is technically different, but functionally the same, or you're basically not even trying to provide a product that's technically different, but you are trying to rhetorically

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basically convince the masses that your product is actually Sharia compliant without it even being technically different from the the products that we have market or the conventional products. The same, we can say about the sellers that are trying to basically say that there is no ribbon anymore. Unless Unless it is gold for gold. But there is basically ribbon anymore. And in this case, you could say well, the you know, the NRA power the cause behind the prohibition and exchanging gold for gold and gold for silver and so on and so forth is that they are measured by weight, and that would be the Hanafi and Hanbury position.

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But, but according to the masochism, shafa is the reason behind

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you know, the prohibition of Riba and gold and silver is that they are currencies. That's us, man. Is he here, here? The problem here is that if you actually say, Well, I'm one of your ham buddy, and I believe that the reason behind the prohibition is Wait, then we will be circumventing the objectives of Sharia was technicalities.

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You know, and the technicality here is not simply sly maneuvering or deceptive and legal devices, you're actually talking about two mazahub out of four. But it's still a technicality, because if you look at it functionally, philosophically,

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then we will not have river anymore. And then we will create problems for the cat as well. Exactly. The limited River. If you're not, you're going to be saying about dollars and pounds and euros can rehabs and so on, cannot be likened to,

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to gold and silver, then you're not gonna only we're not gonna only have problems in the chapters of river, but we will also be having a lot of problems in Zakat as well, precisely. So we're kind of we're in full agreement then that those small minority of voices with utmost respect to them who claim that mortgages are simply not even an example of Riba that they really don't seem to be coming from a solid background. And we both agree that the conventional mortgage is in fact a type of Riba. Now, Let's now get to the the the the the juicy stuff here, we agree that the mortgage loan is a type of Riba loan, the question arises, under what circumstances would this be permissible, we're

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all aware shahana that, for the last 30 years or more, there has been an ongoing debate amongst our scholarly class, one side of which allows a conventional mortgage with a list of reasonable conditions, it must be the house that you live in, you cannot afford, you know, the alternatives, meaning you cannot just purchase the house by cash. You don't do this for business. And of course, you have some very, very well respected jurist, you know, the shaker and Cordoba is, of course, the most famous example. But it's not just him, I mean, the European Council professional photo and research in 1999, by a large majority, if not unanimous or forgot, they voted, they also gave a

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factor in this regard, the number of scholars that say that a conventional mortgage, just straight up from the bank, if you're living in the West, and in your middle class, basically, you're not a millionaire, you can't just afford it by by one cheque or whatnot, that they say that it is a type of need, not a type of boat or necessity, but a type of need. And they have their interest without getting into the the reasons and the causes. Because again, that's a bit too advanced for our, you know, a conversation here. But just without getting into all of the details of why they're saying this, what is your Frank assessment, your own personal opinion, that is it permissible for the

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Muslim living in the west to obtain a conventional mortgage? And also what is your advice to the lame Muslim when he sees you know, Chef qaradawi and these great aroma on one side and then on the other side, also great aroma. So Part A and Part B, if you want to

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run the property is is easy, because

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I would have to say two things, you know,

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I am a member of Amgen at Amgen we you know, our position on this issue is clear that conventional mortgage is not permissible except in the case of ora I'm not had exactly the case or not had and so

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you know, the the senior scholars of the European Council the the they felt that there is a harder

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And because of that, there is like a headline that they basically allowed

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conventional mortgage, but they allowed it, if there is no Islamic alternative, and since we have somewhat,

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you know, an Islamic alternative now is and we all are in agreement that you should first seek the Islamic alternative

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that that is available for people in the US and in Europe as well. So, that at the time they allow this, there was no Islamic alternative.

00:35:41--> 00:36:18

And these, I do remember that they clearly stated that as long as there is no Islamic alternative, then it would be allowable for people to to obtain a conventional mortgage, I would say that, let us basically say that this one should be addressed on one by one basis, the person who does not have access to an Islamic mortgage and feels that he has some type of Aurora or harder today, he needs to ask a seller about this and then go by their fat word

00:36:19--> 00:36:24

has four parts the you know, you know that

00:36:27--> 00:36:34

it's a complex or complicated question. I would just say that that the two important pieces of advice here are one

00:36:35--> 00:36:40

commandment shefali said as mama Simona I know minister Ivana minister Bennett knows

00:36:45--> 00:36:59

that you Muslims unanimously agree that to whomever the center has become clear, it is not permissible for them to leave it for the statement of any scholar. Now can all Muslims in certain cases,

00:37:00--> 00:37:33

things could be clear, in many cases you may not be able to discern, you may not be able to understand the rationale behind the southwest of the Sounders but when it is clear to you that the intent of Allah and His messenger is to prohibit or to allow something give them the statement of a salary will not save you if it if you feel in your heart that you're quite confident that this is what a lions messenger had wanted of you. The second thing is that is a wall beside my bed, which is kind of back

00:37:34--> 00:37:37

bedroom at night and not enough sweat man.

00:37:38--> 00:38:04

Well, it's a heck of a nasty water under the sun. We're in effectiveness after so consult your heart when you know the Prophet was on himself to beside consult your heart righteousness is that with which you feel comfortable or the heart feels tranquil and the soul feels comfortable, and it's more sin is what waiver is in your chest and causes discomfort in your breast

00:38:06--> 00:38:16

regardless of how many factors or regardless of how many times that people have given you, the legal counsel or their federal, So,

00:38:18--> 00:38:35

having said this, if it is if your heart feels uncomfortable, then I would tell you listen to your heart. And I would I would say in general, I would say in general one should try as much as they can to exercise water

00:38:37--> 00:39:07

you know, consciousness, screw philosophy, religious group philosophy for being cautious being careful. But when there is a particular you know, issue that causes you hardship, whereas there is a particular matter particular issue that causes your hardship and you've got two different opinions from two different scholars one is easier and one is more difficult. And it is not clear to you what a lot has what a lot wanted of you on this particular respect. I

00:39:08--> 00:39:16

can hear you know that there you just can't understand the rationale behind the two fatwas, it is okay to take the easier one

00:39:18--> 00:39:59

is not saying that you're going to be doing this all the time you're going to be scanning gold, the fact that you know in the world and picking out all the easier fatalities, but I'm saying that if you come across or encounter a matter that is causing you hardship and different factor you hear different fatawa and some are easier and some are harder, it is okay in this case, to take the easier case. So to summarize then, that the position of shear qaradawi in the European Council, we respect it, and it is coming from a legitimate paradigm we are not dismissing it at all it is a legitimate fatwa. However, I think the both of us are in

00:40:00--> 00:40:41

A very similar wavelength that we don't endorse that fourth word unconditionally, rather, only if there is no alternative. And if the person circumstances are specifically in a pretty difficult situation, perhaps in that particular exceptional scenario, but as a default as a norm, the both of us are very hesitant to open the store. She I don't know what to add here, though, one of my dear mentors as well. And I mentioned his name because his YouTube clip went viral 10s of 1000s, maybe hundreds of 1000s of people saw it. A few months ago, he released a short video about mortgages. Dr. acuminata, we I'm sure you're aware of him in a great demand share. And he said that when it comes

00:40:41--> 00:41:23

to food and drink, the haraam will never become halal, unless it is doTERRA life and death. However, he said when it comes to finances and financial matters, he says generally speaking to how long becomes halal Hello, not at the level of the router, but at the level of hajer, or a general need now, for our viewers in Islamic law matters are divided into those areas and had hijacked into senior. So Volterra is like you need it your URL, you're gonna die, food, water, drink air hajer, it's something that makes life you know, livable, if you don't have it, you're not going to die. But it just makes life very difficult. And then toxemia, there's, of course, the end is something that

00:41:23--> 00:42:02

makes life luxurious and nice, but you don't even need it. And his point was that, for example, insurance, for example, car insurance, it's not Motorola, but it is a hedger you could get by, you're not gonna die if you don't have car insurance, but it's a hedge. And he gave other examples from the economic field as well. And then he said that most of our scholars understand this when it comes to most of the transactions, that there's a hajer. And so they'll overlook yet when it comes to mortgages, he says that the hajra might even be even more. So for example, you want to have a house in the district that your children go to school to, and it's a good school, or you want to get

00:42:02--> 00:42:37

a house that is close to the mystery, we want to get a house that is close to your parents, for example, that is a bigger hedge than many of the other transactional hijacks that many of our scholars allow, you know, they they allow certain concessions for so he was very clear in this regard. And he of course, endorsed the European Council of fatwa that the default ruling for them would be that the average Muslim in the West would be allowed to take a mortgage because he said, it is a hajer. And because of how jots are allowed to be, you're allowed some laxity when it comes to financial issues, your your comments and thoughts about this shahana.

00:42:38--> 00:42:55

It is very complicated. And certainly I respect, Schaeffer coming out with a great deal of success color, I just wanted to say that they're not all equal, you know, they're not created equal. different senses are different.

00:42:56--> 00:42:58

When it comes to insurance,

00:43:00--> 00:43:06

insured insurance insurance is basically prohibited because of another and a lot of which is taking

00:43:08--> 00:43:48

place and under thinking due to uncertainty and ambiguity is a genre of sins or sort of mohana Mahabharat, prohibited transactions, the whole genre of these prohibited transactions. There are many exceptions in this area were not on hasn't been allowed by the Sharia, some degree of error has been allowed by the Sharia, some degree of error has been allowed by the Sharia for like needs for various things. But when it comes to rebellion, particular rebellion God are not the same. So that is why generally speaking, if if we're talking about the father,

00:43:49--> 00:44:14

or we're talking about sort of clauses in the contract, that are not compliant, then certainly had an invalid or they both will, they will post the operative year in in making concessions in making concessions, but when it comes to the clear cut river, you know, when it comes to the pendency of the agreed upon river, the clear cut river

00:44:15--> 00:44:20

is and this is where we say that it is only the Aurora not the Hydra

00:44:22--> 00:44:37

that will allow concessions, having said that, we you know, I understand that that there is like a you know, that someone can argue about someone can also say that Riba is not prohibited

00:44:38--> 00:44:59

in and of itself, it is frequently because of what what it leads to, as to evil not that it is even in and of itself, but it is a means evil. And why are you creating that difference between Riba and the quarter someone can also say that the Prophet sallallahu Sallam allowed some degree of liberty

00:45:00--> 00:45:39

analog diet, which is basically the exchange dried dates for right dates on the palm trees. And certainly there are different kinds of rubber combined in this transit. But he allowed it for a hazard not the ruler, the hazard. People wanted to eat fresh dates. I mean, they have the drive, they just don't like to go high. But they wanted to eat fresh dates. So he recognized the need for fresh dates and he allowed us so I understand that there is like it is it is not completely cut and dry. But, but what what we're trying to say is that there has been,

00:45:42--> 00:46:09

like close to a consensus of the contemporary Muslim scholars, that labor is a category that is higher in prohibition. I mean, it's quite obvious that the prohibition of all of the app about trip are quite obvious. So they they are saying that this is a category that is different from her or undue risk taking. That's why they have been a lot more permissive in things like insurance than they were in clear cut River.

00:46:11--> 00:46:15

So a lot of Leno's bus. Excellent. So once again,

00:46:16--> 00:46:18

once again, when the two of are

00:46:20--> 00:47:00

definitely coming on the very solid paradigm definitely great will soon and you can make an argument. But as is clear, you respectfully disagree because of a very, very technical point, which is actually not that technical items, it just it is that the gravity of the sin of river is a totally different caliber, if you like then the other issues that the Sharia might have overlooked when it comes to other financial matters. So because of this, you are not comfortable opening the door. That's a very valid paradigm. Now, here's what I wanted to also just answer a few if you don't mind, I just wanted to say that many of the scholars are saying this because of a different

00:47:00--> 00:47:12

constitute like there is another layer of complexity here which is a title and the public need and that is why some scholars are being more permissive and amendment Terranea invoke lprc or the acetone

00:47:14--> 00:47:32

he talks about this and he talks about you know, let us say you know is that facinated McCaskill that that you know, means to livelihood become so, difficult Hello means livelihood become so rare and scarce and difficult. Papa Papa

00:47:33--> 00:47:37

karamo that haram prevails on earth.

00:47:39--> 00:47:51

And then he said something that is very interesting, he said that, you know, it is not far fetched to say that this is the case in our times in this century.

00:47:52--> 00:48:40

Because then it is not possible for us, it is not possible for us to handle national and international equality, what are reality business, it is not possible for us the demand of people to basically refrain from sustenance or abstain from sustaining themselves and, you know, clothing themselves and so on and so forth. And then he continued, and this is like, you know, you continue to talk about different examples, where it will not be only for Aurora, but for Hajj, where the concessions will be made, not only for Aurora, but for Hydra. And he mentioned that if the Muslims limit themselves during those times, if the Muslims limit themselves to that rot, that was the

00:48:40--> 00:48:44

ability to own as a as an omen. So that is another

00:48:46--> 00:48:55

reason why I do not condemn the other fatawa I just disagree with without condemnation, because I do understand that there are different,

00:48:56--> 00:49:35

you know, takes on this matter, and I respect all the scholars and they're fakes, as long as they use proper suit and proper methodology, because that isn't and again, I'd like to underscore this point, Danny, what Dr. Hatem said, especially for our viewers, is that all too often we find some of our students may allow Xhosa you know, guide them And grant them more wisdom. They are so overzealous in their remarks about great aroma that they disagree with. And they don't understand that in fact, those aroma, they're also or solid, they wouldn't be. I mean, if they had some that are completely whacked out or far left field, they're coming from a solid paradigm and actually, you

00:49:35--> 00:50:00

know, if you listen to Dr. hatten carefully Subhanallah what a generous spirit a doctor had him he actually gave more arguments even though he doesn't agree with it right? And he's saying I see where they're coming from. So this is the spirit that I wish all of us have is that utmost respect. I respectfully disagree with their fatawa they have the paradigm correct. They have the SOA valid but it is a gray area and they are prioritizing certain things. We are prioritizing or

00:50:00--> 00:50:34

things. So at home The doctor has and we're exactly on the same wavelength here we have three questions left, but these are the zoob, the and the hood also now. So now, we've spoken about general mortgages, let us get to the issue of the Islamic mortgages that is the conventional name that is given to them. And before I ask you the question, let me set it up for our audience. And viewers. A brief summary is warranted here, that the Islamic companies that offer Sharia compliant loans, basically, I'm calling it an Islamic mortgage, because that's some of the terms that is used. But it's called a Sharia compliant loan. There are a number of models that these companies use,

00:50:35--> 00:50:54

three of them are the most famous, they're not the only but these are the most the most utilized. The first of them is called the murabaha with the promise to pay, and what that is, is that the company buys the house, and then sells you the house back in installments for a profit. Okay, so this is the murabaha

00:50:55--> 00:51:36

mark man wants to be shot with a promise to pay this is the first model that is used the second model, which is perhaps the most common in North America, and that is an Mashallah gun with an alpha son winter hibbett technique, that's a diminishing partnership that eventually ends with you owning the property. And in the second model, the the Islamic company purchases the house along with you, you're both owning the house, and you enter into a partnership. And the the the the percentage of ownership slowly diminishes as you keep on paying the monthly installment, and you pay the same amount, but a portion of that goes back to the loan, and a portion of that goes to the rent, and the

00:51:36--> 00:52:15

proportion of loan versus rent, it continues to change as the years go on, until finally you have paid off the entire loan and the rent, and then the house is yours. So this is called the diminishing partnership model. And we'll shout out with anarchism. And then the third model which is used by one or two companies here in North America, and that is the ijarah rent to own. And that is when the Islamic company the the Sharia compliant, quote unquote, company, that it'll ask you to get a conventional loan, and then it'll purchase the house off of the bank, and then resell it to you in installments along with a rental agreement. So these are the three main conceptual mechanisms.

00:52:15--> 00:52:49

Number one morava hot with the promise to buy. Number two is the diminishing partnership. And number three, the adjara rent to own. For now, the question I want to ask you, Dr. Horton, let's leave aside the real contracts that exist with these companies. Let's talk conceptually speaking, if we could have an ideal contract that is more about how we promise to buy number one, number two, the diminishing partnership and number three HR rent to own, what is your personal verdict, conceptually speaking, for an ideal contract, and all of these three categories Bismillah

00:52:51--> 00:52:55

Bismillah, the idea of contract would be the murabaha.

00:52:57--> 00:52:59

Because it will be easy.

00:53:01--> 00:53:14

Problem with the morava idea contract is the murabaha. If the Islamic mortgage company has all the resources it needs for all the funds, it needs

00:53:15--> 00:53:29

to you know, for all the Muslims and all the people, their customers, without needing to go to the secondary market and sell those contracts. You know that the problem was morava is

00:53:30--> 00:54:01

murabaha means cost surplus. Same. It is when you when it is called Mr. Mishra, as you said, it is basically cost per sale to the purchase order, I go and order you to purchase the property for me, and you add your markup and send it back to me. After you possess it, you add your ship and send it back to me for a larger sum of money over many years. So it's a simple,

00:54:02--> 00:54:38

simple contract. Simple contract to that once we have ensured that you actually bought and possess the property, you could turn around and sell it to me for a markup that's you decide then what I will owe you is attacked. Now, you give me $300,000 and you give like many other people, the you know 500,000 800,000 and so on and so forth. You run out of money

00:54:39--> 00:54:47

unless you can take this contract and sell it in the secondary market to Freddie Mac, Fannie Mae or Freddie Mac or somebody

00:54:49--> 00:54:54

you will not have funds to to to give to any more clients. And

00:54:55--> 00:54:59

then if you are if you're a Muslim, you have a problem at your hands.

00:55:00--> 00:55:25

Here, because you can sell debts or the sale of debts is impermissible in Islam. So murabaha is not doable, if we're talking about Muslim companies, and we do want to patronize Muslim companies, and we don't want to support them, and so on. because of this reason, unless they have enough funds for everybody, which, you know, I don't know if anyone has.

00:55:28--> 00:55:53

So, that is what are behind the the diminishing partnership, the problem with diminishing partnership is that it is complicated, because you will continue to be a partner for 30 years, and you to live up to what that means, you know, you are a partner. So you have to live up to the requirements of partnership, and the rules of partnership in Islamic law.

00:55:54--> 00:56:05

And that makes it complicated. To get out of all of this, you will need to have many clauses in your contract, that will be

00:56:06--> 00:57:01

not compliant, or at least that you will have to put a lot of effort and so much patchwork to get them to comply, it will be pretty difficult to get all the plants to comply. The same applies to the rental one, the same of I surrender one you will be deadly sore, and I will be the lessee, but as the financier You are the lessor, and you are the list or for how long for 30 years. So, you have to live up to the rules of ijarah in Islamic law, and that is also difficult, because you will have to be responsible for periodical, you know, or the quality of siana SSA. Like the same applies to the diminishing partnership in proportion, proportion to your

00:57:04--> 00:57:47

assets. But but but the idea here is it is also problematic. Now you cannot if those contracts are there all this risk, you cannot take them and sell them in the secondary market to freddie mac and fannie mae. So in order for you to be able to do this, you will have to eliminate the risk as much as you can, as much as you need to, to be able to sell them in the secondary market. And that elimination of risk goes against the sort of the rules and the Sharia. So there are communications in all three kinds of contracts.

00:57:49--> 00:58:02

Unless you have the political will. And the economic capacity, not only the political will, because we are part even in a Muslim country, in a Muslim majority country, we're part of the global financial system.

00:58:03--> 00:58:25

And it is hard without so much political will and economic power. Both, you know, both of them, it is hard to to have products that are truly compliant, in essence, that are functionally Islamic, technically Islamic and in every way Islam.

00:58:27--> 00:59:14

So that's that's the difficulty they encounter, and so on. So again, to To summarize, then what what you're saying is that, ideally speaking, the murabaha would be the best all three of them in an ideal world if we had the finances and if we had, you know, the the the wherewithal, you could construct an islamically permissible contract, no problems, but we get to the crux of the matter. And that is realistically It is simply not viable for any corporation for any entity to manage many hundreds, if not 1000s, you know of properties and sell them to so many Muslim clientele without getting involved in certain conditions, certain clauses that are highly problematic, and this is

00:59:14--> 00:59:56

where of course the problem comes. And that is that conceptually speaking, these three models. Yes, ideally, it's possible to be 100% headed, but realistically, we know that when these corporations when these Sharia compliant, they call themself Sharia compliant companies, when they ask you to sign their 3040 pages of documents. There are so many specific clauses in there that are highly problematic and questionable. And as you pointed out, Dr. Dr. Horton, they seem to be very unfairly prejudiced against the buyer and in favor of the company, whether it is distribution of maintenance costs, whether it is taxes, whether it is even late fees, which is another issue. And so Let's now

00:59:56--> 01:00:00

get to the the the crux of the matter here. We understand the

01:00:00--> 01:00:18

Contracts do have problematic clauses, even if ideally, the model might theoretically be valid. Do you think these problematic clauses invalidate the permissibility of the contract? I know that's a broad ended question. So feel free to elaborate and give, you know, give the caveats over here?

01:00:19--> 01:00:22

Well, let me, let me say this

01:00:24--> 01:01:11

idea here is that the old contracts that we have the stellar established industry, or you can actually instrumentalize them in our modern times, to provide Islamic modes of finance, and you will have to have new contracts, each and every scholar recognizes that these are new contracts, no matter how much we give them, Islamic names, or names of established Islamic contracts or transactions. These are new contracts, they're not the old ones. And many scholars, you know, and that is, and most of the Muslim countries, they they, they take the photo of the American Library, or the 30 Tamia that no contracts can be hydrolyzed that, that you could have new contracts you

01:01:11--> 01:01:29

don't have, you don't have us established contracts in Islamic fact. But you could make new contracts, as long as those new contracts are not in conflict with their principles, with the Islamic objectives and the principles of,

01:01:30--> 01:02:21

you know, Islamic transactions. So we do understand that these are new contracts. Now, these new contracts, in order for them to be hollow, they need to meet certain guidelines. So in order for them to be held on and to provide a functionally, a different alternative, an alternative that is more equitable, and alternative that will basically make Islamic finance shine, and show, you know, the transparency, the accountability, the equity, the social responsibility, those are the characteristics of Islamic finance. However, Islamic Finance, in our times, even in Muslim majority countries, does not have that good reputation. You know, why? Because of different reasons. One,

01:02:21--> 01:02:37

because of the difficulties of creating instruments like financial instruments within the global financial system that are compliant, because the global financial system is expectedly not really considerate of our values and our laws.

01:02:38--> 01:03:16

The second one is that banks do want to eliminate the risks, whether it because they want to eliminate the risk to be able to sell their contracts in a secondary market, or they just want to eliminate the risks because they want to eliminate the risk even Muslim majority countries. So there is a large distance between, you know, what, you know, what we aspire for, and the reality, a large distance now, and what I beheaded Mr. Mishra, Mr. Mishra, or did the cost plus save for the purchase, or they're the problems with this.

01:03:18--> 01:03:23

There are so many problems and this, that cause you know, this to be,

01:03:25--> 01:04:14

you know, not completely like compliant in its current forms. One isn't, while other is basically the mutual binding promise, it is not the promise for by one entity, it is promised from both entities, which scholars consider it akin to a contract, although there are some differences. And I don't know how technical you want this to be. But like if we want to make it not too technical, then we were saying, let's just mention, you know, the major problems. One of the major problems is the mutual binding promise, which is in Wada, which is too many scholars that came to a contract I promised to buy, you know, I tell you buy this for me, and then I give you a binding contract to buy

01:04:14--> 01:04:57

it from you for a binding promise to buy from you. And that binding promise Some people say that the Maliki position, many Maliki's would argue that it is not Maliki's don't even accept, you know, the murabaha concept to begin with. The Maliki's many Maliki's many contemporary medical scholars would consider the binding promise in these transactions to not be the proper Maliki possession. And, you know, the magic is like a chef, for instance, wrote extensively on this issue powershift Public Library at the Mufti of Libya

01:04:59--> 01:05:00


01:05:00--> 01:05:10

This is just one of the problems and we're talking about a binding promise from one side, we're not talking about a binding promise from both sides, which is even more problematic.

01:05:11--> 01:05:17

But that is what happens, they have a binding promise from both sides. And then

01:05:18--> 01:05:20

what is also

01:05:21--> 01:06:16

unclear is whether the bank possesses the property or the institution, the financing institution, or the bank possesses the property before they turn around and hand it over or, or pass it on to you that possession is important that is necessary for this transaction to be valid, because I'm proud to be a man as the Prophet sallallahu Sallam said, that profit is tied to liability, if you do not become liable for the property, you know, money that's not beget money, there has to be some risks, there has to be some labor, there has to be some reason to make profit, otherwise, money should not be get money. So the bank or the institution should own the property and then sell it to you does

01:06:16--> 01:06:17

this happen?

01:06:19--> 01:06:27

You know, one institution wrote to the Office of the Comptroller, the Office of the Comptroller of currency,

01:06:28--> 01:07:30

and explain to them the murabaha type contract to convince them that there is no difference between it and between the murabaha contract and conventional mortgage and to convince them because, you know, banks should not be involved in risky ventures, risky investments. So, the Office of the Comptroller of currency would not allow them to basically be involved in a risky investment or transaction. So, the bottom line is the Office of the Comptroller of currency told them that you have that this is functionally like completely similar to a conventional mortgage and it is okay, it is fine, because they have eliminated the risk to a point where you cannot, you cannot recognize any

01:07:30--> 01:07:45

functional difference functional, not technical, because the contract may be technically, but you cannot recognize any functional difference between it and the conventional mortgage. So, that is one

01:07:46--> 01:07:51

basically, instrument of Islamic financing.

01:07:52--> 01:08:02

Now, does it does it? Does it make it different to be technically different? Yes, it makes us different. here's the here's the here's the point that we have to agree

01:08:03--> 01:08:19

to disagree on. Some people say that we look so naive, and we look so idiotic in front of all people that we are actually trying to it is basically like setting up the net on Friday.

01:08:22--> 01:08:53

And we're doing it and we know that everybody knows that we're doing it ourselves. How could we do this? The issue here is that you do not want to open the floodgates, you do not want to break that psychological partition between us and Reber. We want to try as much as we can, even if there are some technical differences, we want to try as we can to have differences. So we're not committing greber

01:08:54--> 01:09:05

like blatantly clear cuts river, you know, so that's the point. So that's the first one. The second one that you mentioned, is that diminishing partnership. And the diminishing partnership

01:09:06--> 01:09:39

is the one that has been chosen by you know, like Muslims that the you know, Muslims who want to get into this business, they can't as I said before, choose the murabaha even though it may be easier, because as I said, after us, after you give the funds, you will run out of funds after like four or five customers or like 20 customers or 100 customers, you'll run out of funds. So you will need to basically

01:09:40--> 01:09:55

turn around and sell this contract to Freddie Mac or Fannie Mae and so that you could find answer other customers didn't do this if you're Muslim was somewhat Ah ha ha because you can sell at that.

01:09:56--> 01:09:59

So that the managing partnership

01:10:00--> 01:10:32

The columns, the became the favorite for, you know, the Muslims that were like some of the Muslims that were pioneers in this industry. And I'm not saying that they did not put effort they put effort, I'm not saying that there are no differences, there are differences are those differences function of differences, you know, sometimes maybe, you know, one of the function of differences and Maura and what are Baja, for instance, is that if the customer died, you know, in that one minute between,

01:10:33--> 01:10:44

you know, the trade transferring the funds to the seller, and finalizing the contract between the financier and the final buyer,

01:10:45--> 01:11:42

if the customer died, then the bank may be here, you know, yeah, so, what, in the diminishing partnership, we do have differences, some functional differences, but mainly it these are technical differences, not functional differences, but some functional differences if, for instance, the bank, if, for instance, you ensure that the house, but the house for some reason, God forbid, got totaled, the insurance company did not pay you the value of the house, the the that the Muslim financier will not be after you for what they have given you only for their share in, you know, in in, in whatever payment that you would get their fair share in the payment that you will get, if they now own 65% of

01:11:42--> 01:12:07

the house, you'll get 65% of the payment that you will get from the insurance company is that a functional difference? It is? Honestly it is. So, but then there are many technical differences. And there are some technical problems also, because according to the IOC standards, and that's the accounting and auditing, you know, for Islamic financing institutions.

01:12:09--> 01:12:25

So according to the alpha standard, according to the different 50 assembly standards, there are some rules that are so difficult to, to uphold, by, you know, by those, you know, companies or by

01:12:27--> 01:12:43

at least in non Muslim majority countries, at least when the laws maybe in Malaysia could do that. Maybe in a you know, in some countries that are more accommodating of Islamic financing, you could do that. But it is certainly very hard here in the US.

01:12:45--> 01:13:27

And there are multiple ones, you know that they will ask you to be responsible for the insurance, they'll ask you to be responsible for all maintenance, even the basic essential maintenance, they'll ask you to not sell the house for a certain number of yours. And if you must sell prior to the end of the agreement, then you must buy them out first and then sell the house and so on and so forth. Many things that are and there's also some mutual binding promise involved in that there are many issues and then the future sale, whether it is by promise or contract, because when when when you do

01:13:29--> 01:13:38

basically a purchase the house and each one of you has a share, you will either promise to buy

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a portion of the house every year until you completely buy them out. Or you agree on the same it is either a promise or a an agreement. If it is an agreement, it's a little bit more problematic, but if it is binding promise from both sides, it is also somewhat of a problem.

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But that that is it is very difficult without this if it is very difficult to leave it up to the customer to purchase at the market price on the day of purchase. So we would agree because then we cannot we cannot figure out how much the person will be paying.

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We will just you know it would be 20% 80%. And then every year I will purchase a portion of the house at the market price on the day of sale and that is to do it in a way that is completely compliant. But again becomes very difficult. So are there clauses that are problematic?

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Are there my heritage outlets? Well, yes, because there are scholars that are working to find outlets. It doesn't take so much work does it take many opinions that are outside of the format

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I have doesn't take a lot of patchwork, it does. As we said, you know, what are our options? What are our options, we either say,

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you know, you don't need to buy houses, you don't need to buy cars, you don't need to buy equipment for business, you don't need to get into business ventures, or we say, you must have completely compliant contracts, which are extremely, extremely difficult. And that is not to discourage people from pursuing what is better and from improving incrementally. And we do say this all the time, to all the Muslim financiers, we do say this all the time to them. And we encourage them to provide better products. But also, we have to patronize them to become large enough to have the sun so that they can dictate their terms. So that's the code the managing partnership. And finally, we have the

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last one that the tomention mentioned were mentioned, which is the HR. And it is to a certain extent, like the diminishing partnership when it's not like it but but the same types of problems that it is a commitment for 30 years where the financier is not going to wash his hands and walk away the financier is the owner is the lessor, and the customer is simply the lessee, he's not responsible, you know, he's not liable, except in the cases of tardy or free negligence or wrongdoing on his part islamically, because we will have to apply the rules of HR, in a snap, can this

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poses a lot of problems also, to become an instrument of financing. And when you get the financier involved at this level, it causes a like a slew of problems. So all of them have issues, but all of them show promise, at least to be technically different from the conventional mortgages so that Muslims are not committing clear cut river, although the contracts may not be, you know, 100% Sharia compliant.

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Now, the fact that we got the clear cut rubber out of the way, makes it easier on us to say that these

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basically contracts aren't allowed to be party in these contracts, it is allowed to use them for your needs, your various needs. And

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I'm just position so far is that these contracts because of the clauses that are not compliant, and

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amda did not sign like sort of like,

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sign on these contracts completely without reservations. But these I'm just sad, because of the these clauses that are not completely compliant, these contracts are permissible for had, if they have any need, these contracts are permissible. And according to under the declining ownership in its current application in America is the one that Amgen favored

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in its declaration. Excellent. So this is very, very useful. So again, to summarize, Michelle Lee went into a lot of technical detail. The to summarize and again, if I said something correct, then then feel free to correct me. Obviously, the way that these three contracts actually exist in the corporations in North America, we're speaking primarily we don't know about Europe, we're not talking about Europe, but the ones in America in North America, the ways that they exist. Realistically, there are highly problematic clauses in all of these contracts, even though they also are the basis of the theory is good, but because these corporations are insuring or trying their

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best to ensure that there is minimal or no loss to them, so they put the onus of much of the burden. And they put so many clauses, that the functionality of the contract is actually somewhat similar, not exactly similar to mortgages, however, they are not all the same, and some of them are better than others. And of those that are probably of the best in the North American scene are the companies that offered the diminishing partnership the Metallica, Metallica. So again, we're looking

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The ones based in North America. And that's the photo of Amgen. So again, Chicana, we've spent more than an hour speaking, I want to now be very, very clear here. And I'm going to give you the position of one of my teachers and mentors. And if you feel free to to validate it, or to reject it, or to modify the format, but I know you're very cautious, I'm going to tell you what one of my esteemed mentors says. And it is something that I feel comfortable saying now, even though I delayed this for the longest time, and that is that

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there is no doubt that the the Islamic Sharia compliant the Sharia compliant loans that are given are highly problematic. However, given the increasing need, given the situation of Muslims in this land, generally speaking, middle class, lower middle class, and of course, anybody who's struggling, generally speaking, the Hajj is enough for them, that they are allowed to avail themselves to these Islamic alternatives, even though they are not 100%. permissible or 100%. Highlander, they say. But given the mitigating circumstances, we will say that we can overlook the problematic clauses, and especially those that are closer to the goals of the shediac and have minimal clauses, and that is

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without mentioning the names of corporations, we don't want to do that. But the one that is an shadowclan, with an office or the diminishing partnership, that having been said, This isn't just an open license. Rather, we encourage Muslim entrepreneurs and businessmen to think of models that are more permissible that are more helpful. We also encourage the lay Muslim to think long and hard that we haven't even discussed the issue is it even wise from an economic perspective, to lock oneself into a mortgage for 30 years, or to pay rent, there are many economists, Muslims and non Muslims that are actually saying, paying rent actually is better for those, especially on the you know, and

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they're in the beginning of their careers, they don't know where they're going to be going, etc, etc. So we don't want to just give a blanket endorsement at the same time insha, Allah to Allah, for most average Muslims, it is permissible for them to purchase the house that they live in using one of these Islamic alternatives. And if they cannot find an Islamic alternative, these corporations are not accessible to them, or they're not able to get a loan from them. And their situation is not necessarily load order, but dire lesser.

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I think he has that the phrase hajra must, I think which is a term that was there but a strong hajer not not necessarily in that situation, perhaps even if they cannot find a Sharia compliant one, they might be allowed to even think of a convention one, this is what one of my teachers has said, Would you allow me to say this? Or would you want to put a caveat, because I know you're very hesitant to to, to say explicitly, so what is your position shift?

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You know, because of the because of my reluctance, and because of my hesitation to basically, to have my own individual position, I just hide behind the unjust position.

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And I think that I'm this position is not really far away from what you said. I said,

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the only thing is that the person who is not able to find an alternative, I would say, ask the scholars that you trust.

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To find I'm sorry, the person who's not able to find an Islamic alternative confused of his Hydra is such that a conventional one would be permitted for them, I would I would tell them ask the sellers that you trust now their judgment that you trust their party and trust their judgment.

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And it doesn't have to be one scholar, as you know, a couple of scholars but once but most are all are trustworthy, and you trust their Dean and you trust to their knowledge. And it is okay to take the easier position if you if you feel

01:24:06--> 01:24:18

Yeah, okay, I can add that caveat chicken, no problem, we mandate on the person to get a specific photo for themselves. You're right about this, so we can add that. So that is definitely

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when we are in complete agreement. Okay. Alhamdulillah Alhamdulillah. So inshallah, with that final concluding thoughts, we we spent a lot of time Alhamdulillah we conclude on a very specific note here. Any concluding thoughts from you any general advice about this topic for our, for our viewers?

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I advise myself and all the Muslims to think of the Muslims to think of the efforts, you know, that are being done by

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women, meaning Muslims and we're not angels and no one is saying that we are angels. Now what is not what is saying that the Muslim financiers are angels

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We make the offer them, we certainly advise them and we

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advocate for the Muslim customers and advise them as much as we can, but we also make the offer them because we know that things are not easy. We know that they encounter many difficulties and it is not always because they want to make more money, it is oftentimes because the circumstances, the laws, the sort of the financial environment around them does not allow them to do better. We send wanted them to do better, but we also want to patronize them. So that they can basically develop, they can grow, they can reach the size where they can have the capacity to improve their contracts and to provide better products or better financial products to the Muslims. And I said Muslims that

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we are in this predicament because of our condition, our condition as an oma and reality is rational. Reality is rational. Let's not blame anyone but ourselves for our condition.

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Reality is rational and you can change it unless you are rational as well. So let's keep our heads down, keep working, keep improving. You know ourselves, our families, our communities, our oma and humanity at large. So,

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just sincere consistent effort from each and every one of us will inshallah improve and change already on Al Hamdulillah. Giacomo aka chef now we had a very very amazing interesting conversation I hope it was of benefit to our viewers and shahana this inshallah is not going to be the last time we we have a back and forth this is the first time we had one but hope inshallah we can do multiple sessions. Definitely the for our viewers here, the sharks PhD, was about medical issues and Islamic fix. So we definitely have to talk a lot about the changing understandings of medicine and how they're going to impact 50 as a practicing doctor, and practicing chef as well locally Luma home

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Alhamdulillah so inshallah This is round one with our chef inshallah we're going to try to have other rounds as well as akmola. Here we hope inshallah, to other that you benefited from this rather long and yet technical and yet also inshallah to other very useful talk. We ask Allah azza wa jal to grant Dr. Hatem, long life full of piety and good deeds in good health, we ask Allah for Allah for him and his loved one for us and our loved ones. We ask Allah azza wa jal to accept all that we do to forgive our shortcomings to exalt our ranks and to ask and to cause us to die upon the caliber of La ilaha illAllah Muhammad Rasulullah until next time, Santa Monica Rahmatullahi wa barakato