Posted on 01/02/2006 7:56:51 AM PST by quantim
Specifically it offers Murabaha mortgage loans, which are Shariah compliant.
Basically the interest is just pegged into the transaction as a fake sell price for the house. I found this info on another website:
This isn't totally new to the U.S. market. I first blogged about this stuff in July of 2002.How it works
- You identify the property you wish to buy and agree the purchase price with the seller of the property in the normal way.
- You approach us for assistance and complete an application form (see section ‘do I qualify’).
- If we are able to help, the bank will buy the property, after solicitors confirmed that everything is in order, and immediately sell it to you at a higher price.
- The higher price is calculated depending on the value of the property, the number of years you wish to pay us over and the amount of your first payment (see ‘payment calculator’ for an indication of the higher price).
- When purchased, the property is registered in your name and the sale between yourself and the bank is recorded in the Murabaha Contract.
- Your first payment to the bank is made on the day of completion and is your initial contribution, normally a minimum of 17% of the purchase price.
They probably have penalties for early withdrawal.
Naw, you missed it. I had to read it several times. See post 8.
Hamtramck. It used to be an old Polish town, taken over by muzzies.
I have a sneaking suspicuion that this will come back to bite this bank in the butt.
Somewhere down the 'pike, it will probably be proven that the funds are being used for terrorist cells in the US.
I'd hate to be late on that payment, amputation or stoned to death.
They beat Madison, Wisconsin to the punch!
LOL
The bank is FDIC insured, but I wonder if FDIC is also ensuring the subsidiary? It would be interesting to know what FDIC's policy is on insuring institutions that are formed solely to focus on religious groups and provide them special services.
thats my point
there is no such thing as a free lunch
if there is no interest, then they hit you hard on fees or some other compensatory charge. being a bank its charges.
The Hash Bash;
The Michigan Mile;
God I loved college!!!
but I had to grow up and get a real job... pity.
They also say that they don't pay interest, either, though. So if they can get enough Muslims to deposit money at their bank at no interest, they will have lots of money to loan at no interest. But in reality, the money is likely to be funnelled into loans by the parent bank to non-Muslims who pay interest. To me, it sounds like a gimmick to get Muslims to deposit money at their bank, at no interest.
Interest -- No.
Discount Rate -- Yes.
(Simplified, but mostly accurate.)
strikes me as similar to a ponzi game, this is just another money game
here , who ever thought it up & wherever he is, benefits
there is no such thing as a free lunch
And America sleeps....
Works like this:
Muslim finds a house for sale; price $100K
goes to bank and strikes a deal with or without down payment.
Bank buys house for 100K and leases to Muslim.
Muslim pays bank $1000.00 a month rent of which $278.00 is set in savings for the Muslim.
Muslim pays for 30 years and the house is his.
The bank has recovered its 100K from the savings account, has had the tax write off for the house for 30 years and has a significant proffit from the actual $722 rental it received.
The proposition is on the order of a contract for deed or a very prolonged lease with purchace option.
When the market demands it.
Stories like this make it easy to separate the small-l libertarian free-marketeer Republican like myself from the more nativist and authoritarian strains.
People were paying toward a house. But if they missed a payment the deal was off. The Clintons kept all the payments *AND* owned the house. To be fair to the Ann Arbor bank, I'm not convinced that their Muslim banking program is as unethical as the Clintons' behavior at Whitewater.
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