Posted on 01/13/2009 7:54:10 PM PST by Sammy67
DETROIT -- Big financial institutions have been battered by mortgages gone bad. But a tiny Michigan bank is getting attention in the industry by turning a profit on loans without even charging interest.
Its specialty: financial products that comply with Islamic law. That means no collecting interest, no short selling and no contracts that are considered exceedingly risky.
It also rules out some of the activity that got Western finance in trouble — subprime mortgages, credit default swaps and the like.
"When you look at the economic crisis we're in, if you were to follow Islamic or Sharia financing, you couldn't have this crisis," said John Sickler, corporate director for the bank, University Islamic Financial Corp. in Ann Arbor.
Islamic finance operations aren't prohibited from making a profit. Far from it. Instead, banks that comply with Islamic law, or Sharia, earn money from fees that are part of the cost of the loan, some paid up front and some over time.
University Islamic Financial has two types of financing, one called a marked-up installment sale and the other a lease-to-purchase sale. Fees in both cases are comparable to interest payments in traditional loans, bank officials say.
For example: A seller who bought a house for $100,000 could sell it for $120,000 or even $300,000, provided the buyer agrees it's a fair deal. The home could be
(Excerpt) Read more at newsmax.com ...
You see, fees that are part of the cost of a loan are not interest. Not at all. They're totally different . . .
If banks had adhered to sound banking practices all along there would not have been any crisis, IMHO!!!
I can’t wait to be dragged into a Sharia Court in Dallas...
Can I NOW have 8 wives?
So it’s a fee, not interest. And we still get to be called religious.Yeah, far superior system of finance ya got there Achmed.
Islam must mean “fraud” in Arabic.
What, you don’t already have your hands full? :-)
just 7, but they can be 9 years old
Good lord - what for?
P.S.
Lovely daughter! Sending best wishes to your young lady there.
Silly mind games. Sure, can't charge interest but it's ok to jack up the price of the asset to accomplish the same thing (probably without the tax break). This is like my wife setting her alarm clock ahead by 10 mins so it doesn't look like she's getting up so early.
Believe me...I could start a sitcom...
Oh, I get it. “Fees”.
So since the California constitution prevents tax increases without a 2/3 vote, the socialist politicians are using Sharia when they pass a budget massively increasing taxes but calling them “fees”.
And I’m guessing part of the assault on the federal constitution will involve fees that make the 2nd Amendment impossible.
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