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Anyone doing/done mortgage with Ijara Canada (Ijara loans)

May 16, 2019
5
0
Hello all,

I am just starting the process with Ijara in Canada. Can someone share their experience with them? So far they seem very organized.

Thank you,
LLL
 

bij4

Star Member
Jan 24, 2018
77
8
Hello all,

I am just starting the process with Ijara in Canada. Can someone share their experience with them? So far they seem very organized.

Thank you,
LLL
Salam, Did you start the process with Ijara. I am looking to go with them too.. let me know your experience please. thanks
 
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jatt-going-canada

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All of you know that they are charging interest right? It is so dumb. "Shariah complaint no interest loans" . They should go to jail for promoting this lie. At the end of the day, nothing is free and you're gonna pay more than what you borrowed. Whether you call it interest or profit, it does not change it.
 

Tika

Full Member
Feb 20, 2012
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Hello all,

I am just starting the process with Ijara in Canada. Can someone share their experience with them? So far they seem very organized.

Thank you,
LLL
Salaam, I'm filling the form right now, do you think it's safe to give them our information such as SIN number?
 

bij4

Star Member
Jan 24, 2018
77
8
Salaam, I'm filling the form right now, do you think it's safe to give them our information such as SIN number?
Salam, I am conpleting the forms too, and I have the same question. Hopefully someone can clarify
 

bij4

Star Member
Jan 24, 2018
77
8
I tried to go with them, they gave me a hard time and I still have the contracts I can PM them to anyone interested if I can find a way but I just signed up here maybe that's why I still don't have access to personal messaging yet... anyways let me know your emails if anyone wants to see the contracts.
Hi, Did you buy a house with them finally.. i am really looking in buyung a house with them and would appreciate if you could share your experience..
 
May 16, 2019
5
0
I was interested in selecting them for my financing, however, as I read the contracts, I realized that you are still paying interest at the end of the day. Worst yet, you pay an additional $20,000 or so over what a normal mortgage would cost to "halal"ify it.

Basically you sign a mortgage with the bank at a set interest rate. You then sign another contract between you and Ijara "convert" that mortgage into a halal compliant rent to own loan. The thing is, the bank is not aware and not involved in this second rent to own contract. They are still expecting principal+interest payments from you every month.

What makes it "halal" according to Ijara is that the second contract tells you that you are paying rent (now we know in reality the bank is seeing this as interest), so basically you are lying to yourself. You also need to create a Trust which you pay the "rent" to. Then Ijara takes this "rent" money from the Trust and pays the bank their principal+interest. They use the Trust as they say its an independent legal entity...but really you created the Trust which makes the interest payments to the bank, sooo if you get down to basics...you will be paying the interest...

They seem to have good intentions, but my research leads me to understand is that their process is you paying extra money to do some wordplay with the contracts to make you feel that you are not paying interest...when you are.
 

bij4

Star Member
Jan 24, 2018
77
8
I was interested in selecting them for my financing, however, as I read the contracts, I realized that you are still paying interest at the end of the day. Worst yet, you pay an additional $20,000 or so over what a normal mortgage would cost to "halal"ify it.

Basically you sign a mortgage with the bank at a set interest rate. You then sign another contract between you and Ijara "convert" that mortgage into a halal compliant rent to own loan. The thing is, the bank is not aware and not involved in this second rent to own contract. They are still expecting principal+interest payments from you every month.

What makes it "halal" according to Ijara is that the second contract tells you that you are paying rent (now we know in reality the bank is seeing this as interest), so basically you are lying to yourself. You also need to create a Trust which you pay the "rent" to. Then Ijara takes this "rent" money from the Trust and pays the bank their principal+interest. They use the Trust as they say its an independent legal entity...but really you created the Trust which makes the interest payments to the bank, sooo if you get down to basics...you will be paying the interest...

They seem to have good intentions, but my research leads me to understand is that their process is you paying extra money to do some wordplay with the contracts to make you feel that you are not paying interest...when you are.
Salam thanks for the explanation, but from what I understand, they are responsible for getting the investor, whether it is from the bank or a private investor. They say they take money from the bank but using a different way than the traditional mortgage..
By the way do you have any other alternative to Ijara?
Thanks
 
May 16, 2019
5
0
Salam thanks for the explanation, but from what I understand, they are responsible for getting the investor, whether it is from the bank or a private investor. They say they take money from the bank but using a different way than the traditional mortgage..
By the way do you have any other alternative to Ijara?
Thanks

Salam,

I have confirmed by speaking to them that they typically work with banks, and with banks they make you sign a conventional mortgage contract with a bank. I also confirmed that this contract remains after they "restructure", thus you will always have a interest based mortgage in the background.
 
May 16, 2019
5
0
Salam thanks for the explanation, but from what I understand, they are responsible for getting the investor, whether it is from the bank or a private investor. They say they take money from the bank but using a different way than the traditional mortgage..
By the way do you have any other alternative to Ijara?
Thanks

Other options that I would recommend that you do further research on is:

- Ansar : based out of Toronto, seems like a good choice if you have a high downpayment available.
- There are a lot of others that are similar to Ijara or have some differences that make them more or less acceptable. These include Zero Mortgage, Aya, An Nuur, ISNA.

I found the following website helpful:
http://askimam.org/public/question_detail/43732

I also want to state that my responses is based on my own research; I am in no way an expert in the fiqh of Islamic finance. I just hope I can make use of my year of searching to make someone's search easier.
 

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The risk shared in any shariah partnership attached to an asset is not in the ultimate loss in equity. This is exactly what the Shariah keeps clear from. You are viewing this partnership as a business venture/partnership. It is NOT a venture. It is a partnership in ownership. If 2 people co-own a comodity, then both are partner (equivalent to the %age ratio) of that commodity in every bit of it. However, they retain their autonomity of the share they own. The partner cannot impose his will upon the other partner. So when we say that they share the risk associated with the commodity, it means that if the the commodity is destroyed, both of the partners loose. It does NOT mean that if Partner A wishes to sell his share for a higher price, Partner B will take a percentage of that profit. Absolutely not. That independance of the ownership is fundamentally engrained in the core concept of Shar'i ownership.

Yes, the partners are bound in certain manners to protect the other from misuse of the commodity etc. However, these are detail additional terms related to any such ownership. For example, If you and I were co-owning a car, I cannot make changes to the car without your consent, since you own the commodity just like I do. Similarly, If I gift the item, it will not be complete. If I have to sell my share, i cannot sell without having presented you the opportunity to purchase the share first. But even in this, I will not be forced to reduce the sale value of my share. If I want to sell my share for $5000, and you cannot afford that, then too bad. If there is a buyer who is willing to buy it, then as long as you had your first opportunity to purchase it, Shariah requirement is filled.

This is basic understanding which ought to be kept in mind when financing. There was no mechanism of "islamic home financing" in early islamic eras, hence such asset based transactions make a mode for such financing. But the rules will remain same..

If and where the bank does violate any shar'i requirements, then indeed such contract and financing model will be compromised and shar'an non-compliant.
Really liked your answer. Thanks for such a insightful reply.
 

Musti82

Star Member
Oct 9, 2017
76
28
Hello all,

I am just starting the process with Ijara in Canada. Can someone share their experience with them? So far they seem very organized.

Thank you,
LLL
is there a reason you choose them rather than a big bank? qualifying is a problem for you?
i have seen a client going through broker and use ICICI bank for someone who was in good shape and relatively new in Canada but the rate was horrible, came to RBC , we got it done in 2 days and rate is less than 3%
 

patelyahya45

Newbie
Feb 19, 2020
1
0
Has anyone gone ahead with any of the halal mortgages in toronto? Any advice would be great as I am having difficulty deciding which one to go with. I really like the conversion concept with Ijara. Seems the most safest to me. If mufti gives a fatwa and approves it then is it okay for us non-scholar to go ahead with it since we arent muftis ourselves?

Zero
Aya
Ansaar
Ijara

Can someone message me here or privately to tell me their experience with any of the above companies that they went with