No interest allowed under Sharia Law.
So to make a loan Sharia compliant, they lie.
The document says the amount borrowed is the principal plus interest due on the loan. Its magic. See no interest.
>>So to make a loan Sharia compliant, they lie.
>>The document says the amount borrowed is the principal plus interest due on the loan. Its magic. See no interest.
I was wondering how they do it. I was certain that muzzie banks and investors do not just loan money to be good people.
The principal is the “house,” the interest is the “monthly rent.”
So, under Sharia, you pay first month, last month, and all in between up front. Sounds like a deal to me.
No interest allowed under Sharia Law.
So to make a loan Sharia compliant, they lie.
The document says the amount borrowed is the principal plus interest due on the loan. Its magic. See no interest.
I think it's a little more nuanced than this. The basic principle is they are allowed to enter into an investment partnership, but not to directly charge interest. So a loan has to described in terms that depict it as a joint investment between the lender and the borrower. It's a fig leaf of course, but intended to limit borrowing to those items that can reasonably anticipated to appreciate in value. I think Dave Ramsay says something similar about borrowing.
Aahh I wondered how they make that work, it seemed like an impossibility to me. So the lawyers, to facilitate all these allegedly “Sharia compliant” loans, must LIE in the legal documents. Maybe they would say that it’s the clients who are lying and the lawyers merely facilitate the paperwork??? But if the lawyers know the figures are sham, then how does this fit with legal ethics???? Never mind the law.
It’s not like a case with a criminal where the lawyer simply does not ASK the questions (everyone deserves legal representation etc.). In the Sharia-compliance case it would seem clear that the lawyers do KNOW with certainty that the figures are false.
This is making Wray seem like a terrible choice, for sure.
Which law partner agreed to the deal?