Is a mortgage (riba/interest) haram in Islam?
Answered with evidence from the Quran and authentic Hadith
Quick Answer
Interest (riba) is clearly prohibited in the Quran. Conventional mortgages involve interest and are considered haram. However, Islamic mortgage alternatives exist (murabaha, ijara, diminishing musharakah) that comply with Shariah. Some scholars permit conventional mortgages for necessities in non-Muslim countries where no Islamic alternative exists.
Detailed Answer
Riba (interest/usury) is one of the most strongly prohibited things in Islam. The Quran explicitly forbids it, and the Prophet (peace be upon him) cursed the one who pays interest, receives it, records it, and witnesses it — calling them all equal in sin.
Conventional mortgages are based on interest and therefore fall under the prohibition of riba. Islamic finance has developed Shariah-compliant alternatives: murabaha (cost-plus financing), ijara (lease-to-own), and diminishing musharakah (shared ownership that gradually transfers to the buyer). These are available in many countries.
For Muslims living in non-Muslim countries where Islamic mortgages are unavailable or significantly more expensive, some scholars (including the European Council for Fatwa and Research) have permitted conventional mortgages as a necessity (darurah), particularly for primary residences — not investment properties. This is a minority opinion that should only be applied when no viable alternative exists.
Evidence from Quran & Hadith
وَأَحَلَّ اللَّهُ الْبَيْعَ وَحَرَّمَ الرِّبَا
Wa ahallallahul-bay'a wa harramar-Riba.
“Allah has permitted trade and forbidden interest (riba).”
Jabir reported that the Prophet (peace be upon him) cursed the one who accepts riba, the one who pays it, the one who records it, and the two witnesses to it, and he said: "They are all equal in sin."
Key Points
- ✦Riba (interest/usury) is one of the most strongly prohibited things in Islam.
- ✦Conventional mortgages are based on interest and therefore fall under the prohibition of riba.
- ✦For Muslims living in non-Muslim countries where Islamic mortgages are unavailable or significantly more expensive, some scholars (including the European Council for Fatwa and Research) have permitted conventional mortgages as a necessity (darurah), particularly for primary residences — not investment properties.
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Note: This answer is based on the Quran and authentic Hadith for general guidance. For detailed rulings on your specific situation, please consult a qualified Islamic scholar. May Allah guide us all to the truth.