Mortgage Alternatives

Archived From: Finance
  • Page :
  • 1
  • Text Only
Voting History
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?


Member Summary
Staff Summary
  • Also categorized in:
Thanks for visiting Join for free to remove this ad.

You mean 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.

Disclaimer: By providing links to other sites, does not guarantee, approve or endorse the information or products available at these sites, nor does a link indicate any association with or endorsement by the linked site to

Thanks for visiting Join for free to remove this ad.

While FatWallet makes every effort to post correct information, offers are subject to change without notice.
Some exclusions may apply based upon merchant policies.
© 1999-2017