Mortgage Alternatives

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Has anyone tried alternatives to traditional bank mortgages? Apparently, there are methods to purchasing a property without interest (or what some call, usury) by allowing the bank to buy a property that the end-buyer is interested in and thereafter selling the property to the end-buyer at a premium but with "zero interest". The point is, this is an alternative for those whose beliefs are against buying/selling using interest.

One such alternative is called "murabaha" offered by, inter alia, Devon Bank.

The problem is, I can't find enough reviews about this thing and I don't know anyone who purchased a property using these methods. Can anyone here shed more light on it or share his/her experiences with us regarding traditional mortgage alternatives?

Thanks.

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You mean Islamic Banking?

http://en.wikipedia.org/wiki/Islamic_banking

I know HSBC offered Islamic banking for its customers. But I am not familiar with anyone who used them.

Either way the bank gets a fee. It won't come out to any less than interest if you had a fee instead.


While I realize your question appears to be about religious reasons for avoiding "interest", I noted your side comment about usury. Which is defined as:

An excessive or illegally high rate of interest charged on borrowed money.

Question: Do you actually think 4% on a 30 year FRM fits this definition?

If it helps, consider a fixed rate mortgage to be a lease which only you can break.
That's a 30 year lease.
I have no doubt, as time goes by, you'll find your property tax bill to be a whole lot more vexing than the interest.
Fortunately, you'll get a tax deduction for both.

Usury originally meant the charging of any interest at all. It's quite an interesting history, you might research it a bit if interested.



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