FAQ

What is Sharia-Compliant Lending?

Sharia-compliant lending, also known as Islamic finance, refers to financial transactions and services that adhere to the principles of Islamic law, as outlined in the Quran and the teachings of Prophet Muhammad (peace be upon him). It prohibits Riba (interest), Gharar (uncertainty), and Maysir (gambling) and promotes ethical and socially responsible financial practices.

How is Sharia-Compliant Lending Different from Conventional Finance?

Sharia-compliant lending operates on the principle of avoiding interest-based transactions and instead adopts equity-based or profit-sharing arrangements. It also emphasizes transparency, social responsibility, and the prohibition of unethical practices, setting it apart from conventional interest-based finance.

What Sharia-Compliant Financing Options are Available for Home Loans?

Sharia-compliant home financing options include Ijarah (lease-to-own). This arrangement enables individuals to acquire homes without engaging in interest-bearing loans.

Can Non-Muslims Apply for Sharia-Compliant Loans?

Absolutely! Sharia-compliant loans are available to individuals of all faiths. These financing options are open to anyone seeking ethical and interest-free financial solutions.

Are Sharia-Compliant Loans More Expensive than Conventional Loans?

While the terms and costs may differ, Sharia-compliant loans aim to be competitive with conventional loans. It is essential to compare the overall costs and benefits of both options to make an informed decision.

Is It Possible to Refinance a Conventional Mortgage into a Sharia-Compliant Loan?

Yes, refinancing from a conventional mortgage to a Sharia-compliant loan is possible. The process involves restructuring the financing to align with Islamic finance principles.

Are There Penalties for Early Repayment of a Sharia-Compliant Loan?

Sharia-compliant lenders typically do not charge penalties for early repayments, as interest is not part of the financing structure. However, it is essential to review the terms and conditions of the specific financing agreement.

What Property Types are Eligible for Sharia-Compliant Financing?

Sharia-compliant financing is applicable to various property types, including residential homes, apartments, commercial properties, and undeveloped land, as long as the property adheres to Islamic principles.

Is Islamic Finance Regulated and Safe?

Yes, Islamic finance is regulated in many countries, and reputable financial institutions adhere to strict ethical standards and financial regulations to ensure the safety and security of their customers’ funds.

At Islamic Credit Corporation we are committed to answering all your questions and providing transparent information about our Sharia-compliant lending services. Our mission is to empower you with ethical financial solutions that align with your values while helping you achieve your homeownership goals responsibly. If you have any more inquiries or need personalized assistance, please feel free to reach out to us.