Seattle Mayor Ed Murray has come up with a proposal to allow Muslims to obtain home loans that are compliant with Sharia law. He made the suggestion as part of recommendations on increasing housing in the city.
According to Marc Stiles of Puget Sound Business Journal, Seattle's housing committee, which consists of 28 members, suggested that the city get lenders and community leaders together to create increased access to Sharia-compliant loan products. Under Sharia law, Muslims are prohibited from paying interest on loans, which makes it "virtually impossible" for them to buy houses.
"We will work to develop new tools for Muslims who are prevented from using conventional mortgage products due to their religious beliefs," Murray said.
Stiles reported that it remained unclear on how many Muslims in the Seattle area would benefit from this plan. However, Arsalan Bukhari of the Council on American-Islamic Relations noted that it was "fairly common" for Muslims to forego borrowing money for houses due to Sharia law.
"They don't want to pay interest," Bukhari said, adding that many high-wage Muslim earners could easily qualify for home loans.
A report from Aamer Madhani of USA Today back in October 2014 stated that the world of Shariah-compliant financing has grown to more $1.6 trillion in assets worldwide over a three-decade period. Countries such as Luxembourg, Hong Kong, and the United Kingdom have embraced some forms of Islamic financing, particularly in the form of Islamic bonds known as sukuk.
"Sukuk act much like traditional bonds, delivering payments to investors until maturity," Madhani wrote."To comply with Sharia, the bonds have to be tied to some sort of physical asset. Instead of interest, investors are being rewarded with a share of the profit derived from the asset."
Islamic finance expert Ibrahim Warde of Tufts University told USA Today that Sharia-compliant financing has become "a fairly global phenomena."
"Islamic finance in general has benefited from the financial crisis largely because Islamic institutions have done better than the conventional ones," Warde said. "One of the fundamentals of Islamic finance - beyond not just charging interest - is there must be a direct connection in between the financial product and the real economy. That's made it more attractive."
However, not everyone is on board with Sharia-compliant financing. According to USA Today, Conservative group Center for Security Policy wrote in its blog that Sharia law takes on draconian roles, such as calling for capital punishment for those who slander Islam and requiring women to get permission from their husbands to obtain a driver license.
"Islamists are attempting to impose Shariah Compliant Finance (SCF) on Western institutions to use our own financial strengths against us," Center for Security Policy wrote. "The most serious problem with SCF is that it legitimates and institutionalizes Shariah law... a theo-political, legal doctrine violently opposed to Western values."
Muslim business owner Ahmed Irfran Khan, who runs a slaughterhouse that produces halal meat in Chicago, told USA Today that he was unfazed by such criticism. He was able to obtain a Sharia-compliant loan for his operations.
"It's progress when you can find a way to do business and stay true to your beliefs," Khan said.
