Interest Free Loans For Muslims - Page 3 - Talk About Marriage
Politics and Religion This is the place to discuss politics, morality, religion, and anything controversial.

User Tag List

 69Likes
Reply
 
LinkBack Thread Tools Search this Thread
post #31 of 64 (permalink) Old 12-11-2016, 09:19 AM
Forum Supporter
 
Haiku's Avatar
 
Join Date: Apr 2014
Location: United States
Posts: 3,397
Re: Interest Free Loans For Muslims

Quote:
Originally Posted by NextTimeAround View Post
The majority of bank revenue streams have nothing to do with interest but with fees and penalties.
I don't agree at all.

A vast amount of mortgages are moved to servicing companies, particularly those that are distressed. The fees generated from these stay with the servicing company. Distressed accounts have huge overhead and the late fees and penalties don't even come close to offsetting the collection, foreclosure, and charge off loss. This doesn't even touch on the the associtated cost for loss mitigation, credit bureau reporting, and dealing with borrower/coborrower bankruptcies. Banks want deposits because it's cheap money that can be loaned as safely as possible. Very basically speaking, without deposits a bank can't make personal or commercial loans.


.........><)))#">
Haiku is offline  
Sponsored Links
Advertisement
 
post #32 of 64 (permalink) Old 12-11-2016, 05:56 PM
Moderator
 
EleGirl's Avatar
 
Join Date: Dec 2011
Location: New Mexico
Posts: 32,258
Re: Interest Free Loans For Muslims

Quote:
Originally Posted by Ynot View Post
No one said the institution needed to carry an inventory of homes. But the institution having to own an item in order to sell it adds many more layers to the process. Real estate transactions can be extremely complex by themselves. It isn't just a matter of the bank just going out and buying a house to resell. Plus the program extends to all sorts of other products.
In addition to the added complexity of the transaction itself, the bank would need to establish a system or department to handle these purchases for resale, just like they have separate departments for every other aspect of the transaction.
Then you would have the accounting aspects of the program. How would delinquencies and defaults be handled. How is the loan carried on the books. At what point would the bank realize the interest. Would the bank be required to declare the profit at the time of the loan or over time?
No, a sharia compliant program would not just entail the bank purchase the home as part of the transaction, there would be much, much more involved.
Ok, I stated it in a simple manner because I thought that the average person is aware that home purposes and sales are complicated processes. And any institution involved in any kind of finances, normal or Sharia would require that the institution have employees, procedures, etc. to handle the transactions and manage the mortgages.

All of that adds to the fees charged when a mortgage is made... even for Sharia mortgages. That' the point. But it's all very doable... clearly.
EleGirl is online now  
post #33 of 64 (permalink) Old 12-11-2016, 06:03 PM
Member
 
Join Date: Aug 2014
Location: Ohio
Posts: 2,943
Re: Interest Free Loans For Muslims

Quote:
Originally Posted by EleGirl View Post
Ok, I stated it in a simple manner because I thought that the average person is aware that home purposes and sales are complicated processes. And any institution involved in any kind of finances, normal or Sharia would require that the institution have employees, procedures, etc. to handle the transactions and manage the mortgages.

All of that adds to the fees charged when a mortgage is made... even for Sharia mortgages. That' the point. But it's all very doable... clearly.
Yeah I worked as mortgage originator for 10 years, including a good number in banks. I know exactly how difficult any mortgage transaction would be. My point was that the Sharia loans that so many are crying about as bad things, wouldn't be the "interest free" walk in the park hand out to Muslims that they seem to be so incensed about.

At the center of every moMEnt of my life is ME!
Ynot is online now  
 
post #34 of 64 (permalink) Old 12-12-2016, 12:31 AM
Moderator
 
EleGirl's Avatar
 
Join Date: Dec 2011
Location: New Mexico
Posts: 32,258
Re: Interest Free Loans For Muslims

Quote:
Originally Posted by Ynot View Post
Yeah I worked as mortgage originator for 10 years, including a good number in banks. I know exactly how difficult any mortgage transaction would be. My point was that the Sharia loans that so many are crying about as bad things, wouldn't be the "interest free" walk in the park hand out to Muslims that they seem to be so incensed about.
I agree. These mortgages will probably end up costing the buyers more than an normal mortgage because all this.
EleGirl is online now  
post #35 of 64 (permalink) Old 12-12-2016, 01:39 PM
Member
 
jb02157's Avatar
 
Join Date: Apr 2014
Posts: 2,188
Re: Interest Free Loans For Muslims

Quote:
Originally Posted by NextTimeAround View Post
The majority of bank revenue streams have nothing to do with interest but with fees and penalties.
I doubt that, what those pirates charge for loan interest should be criminal. It's definitely not an insignificant amount.

"I've paid double for every transgression I've ever made and that motel and that boat are little to ask for"
jb02157 is offline  
post #36 of 64 (permalink) Old 12-12-2016, 01:44 PM
Member
 
Join Date: Mar 2016
Location: New Jersey
Posts: 1,655
Re: Interest Free Loans For Muslims

Quote:
Originally Posted by jb02157 View Post
I doubt that, what those pirates charge for loan interest should be criminal. It's definitely not an insignificant amount.
What's a pirate's favorite letter?

R?

No, 'tis the SEA we love!
Herschel is online now  
post #37 of 64 (permalink) Old 12-12-2016, 01:46 PM
Member
 
jb02157's Avatar
 
Join Date: Apr 2014
Posts: 2,188
Re: Interest Free Loans For Muslims

Quote:
Originally Posted by EleGirl View Post
The bank does make money on Sharia compliant loans.

The difference is really in the wording of the loan.

They just leave out the talk about interest in the Sharia compliant loans and call what is basically interest a fee. Same difference, different language.

Let's say I have a mortgage for a house valued at $180,000 and over 30 years I will pay $150,000 in interest.

The paperwork for a Sharia compliant load will not mention interest and it will say that the person has to pay $180,000 + $150,000 for the home, or $330,000. It will also say that if they sell the home before paying off the mortgage the remaining free will be excused based on some table that is basically an amortization table.
I know, but that's still paying interest if you ask me. Any premium you pay in addition to the cost of the house is generally defined as interest. Call it what you like, but like I said before, a bank is not going to loan you money without making money off the deal.

"I've paid double for every transgression I've ever made and that motel and that boat are little to ask for"
jb02157 is offline  
post #38 of 64 (permalink) Old 12-12-2016, 01:49 PM
Moderator
 
EleGirl's Avatar
 
Join Date: Dec 2011
Location: New Mexico
Posts: 32,258
Re: Interest Free Loans For Muslims

Quote:
Originally Posted by jb02157 View Post
I know, but that's still paying interest if you ask me. Any premium you pay in addition to the cost of the house is generally defined as interest. Call it what you like, but like I said before, a bank is not going to loan you money without making money off the deal.
I agree that it is still paying interest under another name. The Sharia compliant mortgages are an attempt to meet the intent of the restriction on interest.

In the long run, it causes me no harm so I don't care if they want to use different language and structure things a bit differently.
EleGirl is online now  
post #39 of 64 (permalink) Old 12-12-2016, 05:14 PM
Member
 
Join Date: Sep 2015
Posts: 2,406
Re: Interest Free Loans For Muslims

I work in the financial sector. This headline is exactly the type of knee jerk, emotionally laden, twisted assertion that we just watch play out this last election cycle.

Finance is all about structuring risk and liquidity and "buying" and "selling" that risk and liquidity.

You are an insurance company with hundreds of millions in long term liabilities and a regulatory requirement to hold reserves against that? How do you earn enough on the premiums to pay the future claims? Particularly in a low interest environment? Swaps are one answer. You swap out predictable, long term payment streams to another company in an environment with unpredictable payment streams. You swap your stable, low risk income stream for higher risk streams with a larger lotential for returns. The other company gets predictable streams that allow their EPS to be manageable, particularly if the payment streams aren't related to their primary business.

Structured finance allows banks that hold long term boring stable real estate loans to package them in bundles, create strada with different risk levels, and securitize it and sell it to other companies. A long term asset (a loan is an asset to a bank) is now converted to a short term equity.

Islamic finance simply has different rules regarding transfer of risk and payment of money for capital (not allowed). But sharing in risk is allowed. That's my understanding. And finance is all about risk transfer and liquidity so why not address that market?


Sent from my iPhone using Tapatalk
TheTruthHurts is online now  
post #40 of 64 (permalink) Old 12-13-2016, 11:23 AM Thread Starter
Member
 
Join Date: Apr 2014
Posts: 1,473
Re: Interest Free Loans For Muslims

Acts 2:44-45 [ The New Testament]

Quote:
All the believers were together and had everything in common. They sold property and possessions to give to anyone who had need.

This is the financial model I want our society to follow; after all, it's the model of the earliest, purest form of Christianity.

notmyrealname4 is offline  
post #41 of 64 (permalink) Old 12-13-2016, 11:24 AM Thread Starter
Member
 
Join Date: Apr 2014
Posts: 1,473
Re: Interest Free Loans For Muslims

Quote:
Originally Posted by Herschel View Post
If so, get your head out of your butt...

You don't have to be rude.
notmyrealname4 is offline  
post #42 of 64 (permalink) Old 12-13-2016, 11:25 AM Thread Starter
Member
 
Join Date: Apr 2014
Posts: 1,473
Re: Interest Free Loans For Muslims

Come on now, we're all supposed to be good secularists.

No religion in secular life. No discrimination with regards to religion. No acknowledgment of religion. Hee hee.

Why can't we be consistent about it is all I am saying????
notmyrealname4 is offline  
post #43 of 64 (permalink) Old 12-13-2016, 11:27 AM
Member
 
Join Date: Mar 2016
Location: New Jersey
Posts: 1,655
Re: Interest Free Loans For Muslims

Quote:
Originally Posted by notmyrealname4 View Post
You don't have to be rude.
I have a disorder, I always have to be rude.
Herschel is online now  
post #44 of 64 (permalink) Old 12-13-2016, 11:28 AM
Moderator
 
EleGirl's Avatar
 
Join Date: Dec 2011
Location: New Mexico
Posts: 32,258
Re: Interest Free Loans For Muslims

Quote:
Originally Posted by notmyrealname4 View Post
Acts 2:44-45 [ The New Testament]




This is the financial model I want our society to follow; after all, it's the model of the earliest, purest form of Christianity.
So you want everyone to sell everything that they have and give it way to those in need.

Doesn't that then put in poverty? Then someone else needs to sell their stuff and give the money to those who depleted their resources.
EleGirl is online now  
post #45 of 64 (permalink) Old 12-13-2016, 11:53 AM Thread Starter
Member
 
Join Date: Apr 2014
Posts: 1,473
Re: Interest Free Loans For Muslims

Quote:
Originally Posted by EleGirl View Post
So you want everyone to sell everything that they have and give it way to those in need.

Doesn't that then put in poverty? Then someone else needs to sell their stuff and give the money to those who depleted their resources.


But it is a Christian financial model or ideal.

Why can't it be respected by financial institutions? Why can't it be respected by society at large?
notmyrealname4 is offline  
Sponsored Links
Advertisement
 
Reply

Quick Reply
Message:
Options

Register Now



In order to be able to post messages on Talk About Marriage, you must first register. Please enter your desired user name, your email address and other required details in the form below.

Important! Your username will be visible to the public next to anything you post and could show up in search engines like Google. If you are concerned about anonymity, PLEASE choose a username that will not be recognizable to anyone you know.

User Name:
Password
Please enter a password for your user account. Note that passwords are case-sensitive.

Password:


Confirm Password:
Email Address
Please enter a valid email address for yourself.

Email Address:
OR

Log-in









Human Verification

In order to verify that you are a human and not a spam bot, please enter the answer into the following box below based on the instructions contained in the graphic.



Thread Tools Search this Thread
Show Printable Version Show Printable Version
Email this Page Email this Page
Search this Thread:

Advanced Search



Similar Threads
Thread Thread Starter Forum Replies Last Post
Amazon free shipping threshold has gone up again Joey2k The Social Spot 64 02-27-2016 05:33 PM
Negative Interest Rates 2ntnuf Politics and Religion 49 02-16-2016 03:29 PM
Free wedding! (Unless you divorce, then you reimburse, with interest). SecondTime'Round The Social Spot 1 01-07-2016 09:16 AM

Posting Rules  
You may post new threads
You may post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are Off

 
For the best viewing experience please update your browser to Google Chrome