Switching from Al-Rayan to Nationwide mortgage

CategoriesTrade, Business & All Things Money [552]

Fatwa ID: 02971

Answered by:  Maulana Imran Mughal


Assalamu Alaikum Wa Rahmatullah

I have a quick question regarding the mortgage. I currently am with the al-Rayan bank and have 22 years remaining. My intention is to clear mortgage ASAP. I can switch to a nationwide mortgage and get a much better rate and clear it earlier. This is my first and only house, as stated my intention is to clear the mortgage. Please, can you advise if this is permissible?


بسم الله الرحمن الرحيم

In the name of Allah, the Most Gracious, the Most Merciful.


According to my research, Al-Rayan Bank is based upon the Islamic finance principles of a Diminishing Partnership (al-Musharakah al-Mutanaqisah), which is correct and valid according to the modern-day scholars.

Nationwide Mortgage applies interest to their loans and therefore it will be haram to take up a loan from them.

Even though it might take longer through the Diminishing Musharakah method, it is the correct way. In shaa Allah through taking halal means, Allah’s help, mercy, and blessings will descend.


Only Allah knows best

Written by Maulana Imran Mughal

Checked and approved by Mufti Mohammed Tosir Miah

Darul Ifta Birmingham

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