Moslem home owners?

[Velvetee]

I understand Moslems, under Sharia law are forbidden to profit from lending money. So they cannot charge any interest on loans(Correct me if I'm wrong)

I happened to see a link on this site for Islamic Mortgages. Have any Moslems purchased their property using this type of lending or are most Moslem home owners, cash buyers?

[Ethel]

There are Islamic mortgages out there - they work slightly differently to standard mortgage.

With a standard mortgage the owner is the mortgagee (the borrower) and the bank has a charge on it to protect its interests. The mortgagee repays the bank the loan plus interest. (You know this)

With Islamic house buying, the bank owns the house and the 'buyer' rents it back for a fixed length of time.

Of course, the rent is enough to pay the capital and profit the bank.
This is obviously a simplistic explanation but that is how it is done.

There are other considerations for the Muslim housebuyer - the bank or financial institutions must not invest in prohibited business, but that is another topic altogether.