A CONFLICT OF INTEREST: ISLAMIC HOME FINANCING IN AMERICA

Authors


Omar Nayeem, Department of Economics, University of California at Berkeley (nayeem@econ.berkeley.edu).

Mohamed Shiliwala Esq., The Association of Muslim American Lawyers (mohameds@alumni.upenn.edu).

Wasim Shiliwala, Department of Near Eastern Studies, Princeton University (wasim@princeton.edu).

Abstract

The rising Muslim population in the USA has fuelled an increase in the domestic demand for ‘inline image’ finance. One of the prominent restrictions that inline image imposes on financial practices is a prohibition on the payment and collection of riba, interest on loans. This paper examines the home financing models of three prominent Islamic financial institutions. It identifies the transaction models that these institutions use, explains the differences among these models and illustrates how each institution ‘sells’ its chosen approach to the public.

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