*Islamic Finance Fulfills US Home Dream* IslamOnline.net & News Papers http://www.islamonline.net/servlet/Satellite?c=Article_C&cid=1209357533688&pagename=Zone-English-News/NWELayout
[image: Image] *"The American dream is to purchase a house, and the American Muslim dream is to be able to do so in an Islamic manner," said Jaka. (Washington post Photo)* CAIRO — Mounir Elhaj was anxious to know how Islamic finance could help her avoid the dilemma of a woman she knows who lost her house after paying mortgage for 17 years once she started missing payments, the *Washington Post* reported on Tuesday, May 13. "The bank still took her house," Elhaj, 45, told sales representative of Guidance Residential, a Shariah -compliant home financing company, at a recent annual community fair in Virginia's northwestern suburb of Sterling. "So I want to know if I bought a house and then fail to pay, can you help me?" "Yes, we can," the representative immediately replied with a smile. He explained that Shariah forbids businesses from profiting from a customer's financial hardship. So, he added, if a customer falls behind on payments there is a number of ways to help him/her cover the mortgage. One way is to charge the person a flat administrative fee to cover processing the mortgage, without percentage-based penalties or piling up additional fees. Other Islamic finance companies buy the house and then sell it to the home buyer again in fixed monthly installments at an agreed-upon marked-up price. Another option is for the financier and the home buyer to enter a lease-to-own contract similar to those used to buy cars. Islam forbids Muslims from usury, receiving or paying interest on loans. Shariah-compliant financing deals resemble lease-to-own arrangements, layaway plans, joint purchase and sale agreements, or partnerships. Islamic banks and finance institutions cannot receive or provide funds for anything involving alcohol, gambling, pornography, tobacco, weapons or pork. *Popular* Nabila Zerrarka is searching for her first home and has already obtained a prequalification letter for a conventional bank loan. But after knowing of the more straightforward ways Islamic companies offer for home-finance at the Sterling annual fair, she is reweighing her options. "What we've seen is that with interest-bearing loans, there are all these gimmicks and hidden costs and tricks that they can surprise you with," said the American citizen of Algerian origin. Islamic home finance companies are flourishing nationwide with more home buyers choosing the alternative, interest-free deals over conventional mortgages. "Folks have been questioning the methods used by conventional mortgage companies over the last three or four years," Hussam Qutub, a spokesman for Guidance Residential, told the *Post*. "I think that makes more people think, 'Well what about the emergence of this [Islamic-] compliant financing industry? Let me give it a look and educate myself about it to see if it could perhaps be more beneficial to me.'" Guidance Residential, which has financed more than 5,000 home purchases since it began in 2002, is reporting its best year yet with business up 7 percent in the first quarter of 2008. Officials at University Islamic Financial, another one of the four major Islamic home-finance institutions in the US, say the number of home-financing applications quadrupled from last March. The company, which originally began working in the state of Michigan, has expanded its operations to seven other states last year. *Muslim Dream* For American Muslims, the interest-free mortgage deals are about much more than just avoiding the evils of conventional loans: it gives peace of mind. "I wish I could avoid everything that Islam doesn't allow," says Hirsi Dirir, a Somali-born technology analyst. Dirir recently obtained a mortgage loan from Lariba, a major company specialized in family home financing, to buy a townhouse. He says that managing to buy the house of his dreams while adhering to his faith by not paying interests made him feel much more comfortable. "So if I have the opportunity and the choice to avoid interest, then it's very important to me not to mess with it." Rizwan Jaka, president of the All Dulles Area Muslim Society in Sterling, recently moved with his wife and six children to a house he bought with the help of an Islamic finance company in Washington. He believes the emergence of such arrangements constitutes an important milestone in the integration of Muslims, estimated at six to seven million. "It definitely marks a coming of age for us… It's part of the whole process of being a part of this country while being able to have our faith accommodated," said Jaka, 35. "The American dream is to purchase a house, and the American Muslim dream is to be able to do so in an Islamic manner." *Related Links:* Debt-ridden Americans Change Lifestyle <http://www.islamonline.net/servlet/Satellite?c=Article_C&cid=1189959224445&pagename=Zone-English-News%2FNWELayout> Islamic Banks Withstand Mortgage Crisis<http://www.islamonline.net/servlet/Satellite?c=Article_C&cid=1201957590961&pagename=Zone-English-News/NWELayout> Islamic Loan Funds London Real Estate<http://www.islamonline.net/servlet/Satellite?c=Article_C&cid=1203757646017&pagename=Zone-English-News/NWELayout> Non-Muslims Favor Islamic Finance<http://www.islamonline.net/servlet/Satellite?c=Article_C&cid=1195032536309&pagename=Zone-English-News/NWELayout> Islamic Loans Serve Non-Muslim Malawians<http://www.islamonline.net/servlet/Satellite?c=Article_C&cid=1203758807619&pagename=Zone-English-News/NWELayout> <http://www.salaam.co.uk/themeofthemonth/november02_index.php> <http://www.google.com/url?q=http://www.youtube.com/watch%3Fv%3DxsyWh1DLIUg&sa=X&oi=video_result&resnum=2&ct=thumbnail&usg=AFQjCNHdw6Ep0Rogvnm0-7gTfjjKNyx1sA> CNBC World - *Islamic Finance*: Applying religion to economics<http://www.youtube.com/watch?v=xsyWh1DLIUg> on* Islamic* Banking
