For example, If the cost of the house is 600,000. Can i pay the owner in installments over the course of 25-30 years. Instead of paying 600k, i would pay 800k. I cant take a loan for religious reasons, thank you. What are the chances of someone accepting this method?
womansworld: In theory yes, in reality you are extremely unlikely to get anyone to accept this deal
Look at this way – you own a house which you can get 600k for – someone buys in the normal way, ie via a mortgage. You get the 600k in one hit allowing you to clear your mortgage or use the 600k for whatever you want
Or you get a person saying, – well I won't give you the full amount, but I will give you 500 a month for the next 25 years ??
Can you guarantee this person will keeping paying for all those years? No you can't. What if you had say a 100k mortage on that house which you need to be paid off – would you financially be able to do that? What if this person stopped paying after 2 years, but was living in the house? You would have all the hassle and expensive of evicting them. What if say after 5 years the roof needed replacing – who pays – the person paying it off or you ? Its really not worth anyone's hassle to sell their house this way.
Other people of your religion must have this same issue – what do they do ? Remember to repay 600k you need to have one heck of an income – do you ? To pay off 800k over 30 yrs (ie 360 payments) you need you pay them 2,222 every single month !
This is done all the time. There are owners that would be willing to carry the mortgage payment themselves. You would need to find a home seller that is sophisticated enough to know and understand this system of selling their home,and is willing to do this type transaction.
In the United States we have laws that allow a person to charge interest in doing this type of sale transaction. We are not accustom to lending money and not charging interest.
The $200,000 incentive you would offer might not be sufficient enough for a seller to carry the mortgage loan. You might be required to offer more of an incentive.
I hope this has been of some benefit to you, good luck.
It would still be a loan. There are private individuals who give loans and some homeowners will finance the house they are selling. It is rare but, it happens. If your religion states no loans, then don't buy the house. Whether you borrow money from the bank – whether you finance a house from a bank or a homeowner, it is still the same – a loan.
Chances are very small but it's possible. Most sellers want all of their money at the time of the sale.
You must understand that you are still taking out a loan and you are still paying interest. You are paying it to the individual, not to a bank or finance company, that's all. It's still a loan.
Only if the owner accepts that although that is highly unlikely the seller will accept that
Numerous “Islamic” financial institutions have been set up throughout the world today. They have been established on the principle of avoiding interest and some of them have flourished.
What you described is a loan. Call it what you like, but you're paying more than market value and not paying up front. That extra $200k is interest on a loan. Nice try though.
This is called rent to own. It's rare, but you can look for someone who is offering it!
Zero to Nil.
Not going to happen in the UK.
it would still be a loan..it would be owner financed..very few owners will do that