A simple checklist to help you assess your home finance
Many Muslims in the UK have taken out mortgages without knowing the full picture. Some signed the paperwork years ago. Others trusted providers that said the deal was Islamic but never showed how. If you are unsure about whether your mortgage is halaal, this page is for you.
Islam does not just ask us to avoid interest. It asks us to be careful, transparent and fair in our financial dealings. Buying a house is a big step, and it should come with full clarity and spiritual confidence.
Use this checklist to assess whether your current or future mortgage is truly halaal. This is not a fatwa or legal ruling. It is a helpful tool based on widely accepted principles of Islamic finance.
He who gives up something for the sake of Allah, Allah will replace it with something better.
Narrated by Ahmad (23074)
This hadith reminds us that sacrifice for the sake of faith always brings reward. Choosing a halaal path, even if it costs more or takes longer, will lead to better outcomes in both this life and the next.
✅ Halaal Mortgage Checklist
Tick each box that applies. The more boxes you tick, the more likely your mortgage aligns with Islamic principles.
Ownership and Structure
☐ Is the mortgage based on a real asset (not just a loan of money)?
☐ Does the provider co-own the home with you or sell it to you in clear stages?
☐ Do you understand how your payments relate to ownership or rent, not interest?
☐ Does the model follow a known Islamic structure like diminishing musharakah, murabaha or ijara?
Interest and Riba
☐ Is the contract completely free from interest?
☐ Are there no hidden interest charges under different names?
☐ Have you checked that late fees are not treated as profit by the provider?
Shariah Oversight
☐ Is the product reviewed by a qualified Islamic scholar or a recognised shariah board?
☐ Are fatwas or compliance documents available and easy to access?
☐ Does the provider offer ongoing Islamic oversight, not just a one-time certificate?
Ethics and Transparency
☐ Are the terms of the contract clear, fair and understandable?
☐ Are you told exactly how much you are paying for rent, profit and fees?
☐ Can you ask questions without being pressured into signing quickly?
☐ Does the provider show concern for your long-term financial wellbeing?
If you ticked most or all of these boxes, that is a good sign. If not, you may want to review your agreement more closely or speak to a trusted Islamic finance adviser.
You can also explore Compare Providers or use Get Matched with a Provider to explore alternatives that meet proper Islamic finance standards.
Why this matters
Some people believe it is enough to have good intentions. But in Islam, how we earn and spend matters deeply. A home bought through interest may seem fine on the outside, but it can carry spiritual consequences.
Allah does not burden anyone beyond their means. If you are already in a mortgage and want to improve your situation, take small steps. Learn the truth. Make a plan. Switch to a halaal option when you are ready. What matters is your effort to stay within what is pure and just.
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Halaal Mortgage Checklist FAQ’s
No. A standard mortgage based on interest is not allowed in Islam. However, some people are in these mortgages due to necessity and plan to switch later. What matters is your intention and effort to find a better alternative.
There may be small differences in interpretation, but the core principles are agreed upon. A valid Islamic mortgage must avoid interest, involve real ownership, and follow shariah-approved contract models.
Look at the contract carefully. If your monthly payments are based on time rather than asset value or rent, and the provider profits from lending money, then interest may be involved. Ask the provider for a breakdown and compare it with Islamic finance standards.
It depends on your situation, but many Islamic finance providers help people remortgage or restructure their home finance. You can explore options through our Get Matched service.
Many Muslims are in this situation. Scholars advise seeking forgiveness, purifying your wealth when possible, and making a sincere plan to switch to a compliant model when you are able.
Always ask for clear documentation. A halaal mortgage should have a fatwa or statement from a known shariah board. If they cannot provide this or avoid the question, be cautious.
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