The irony of the Somali home owners

[*Arabman]

[So everything with interest is haram? does that include credit cards and student loans? In today's world it's close to impossible to avoid interest especially working class people, that is the system in the west. Still, I would avoid buying expensive house on mortgage for financial reasons more than anything else.]

There are millions who live and survive without credit cards and student loans. It's not impossible (or close to impossible) to live or survive without credit cards and student loans. Yeah, everything with interest is questionable. Interest isn't an issue of death and life; there's alternative to it. Besides, interest has ruined the lives of millions. Millions of Americans (including Somalis who live in America/Canada) are stuck with thousands of dollars in credit card payments.

[*Nobleman*]

A lot of the banks that offer 'sharia compliant products' are in fact disgusing haram riba with other more glamorous words. Also i use to under estimate the sin of riba, but have now realised the greatness of this sin.

My bank constantly bugs me to open up a high interest savings account and say donate the interest to the poor, however if you receive, pay or record riba the sin is equal, so i refuse.



Also another question i have is: interest free student loans haram? they are interest free, but repayments go up with the rate of inflation 2.5-3% which is nearly as high as some rates. is this permissable. I would appreciate any answers, jazk

[*Arabman]

Why America Is Going Broke
By Michelle

Americans are going broke. That seems like a ridiculous statement to describe people who live in the richest country in the world. Unfortunately, the statement is pretty much true. A recent report revealed that Americans are now spending 1% more than they earn. The savings rate for Americans now sits at -1%, the worst savings rate in over 73 years.

While people once strived to save 10% of their earnings, most Americans now want to spend what they have and sometimes what they do not have. The reasons for why Americans are going broke vary. Some go broke due to overusing credit cards, while others struggle to make monthly mortgages or car payments. Others are involved in divorces that leave them with next to nothing. Still others cannot keep up with the cost of living, which has greatly increased over the past 30 years—while salaries haven’t quite kept up with the change. Some are laid off by their employers, as is the case with many auto workers.

Credit Cards Ruin Lives

Practically every adult American has had or currently has a credit card. It’s easy to see why—they offer Americans the chance to buy things that they might otherwise not be able to afford. While credit cards can be a great way of establishing credit, they can also be quite lethal for Americans.

I’ve seen this first hand with my parents, both of whom have racked up big debts on credit cards. They both charged gifts and other things, ranging from gasoline to groceries, on their credit cards without much thought. Pretty soon, they charged more than they could afford to pay back. As they stopped making monthly payments, the late charges started to pile up. Eventually, it got to the point where they had minimum payments from $200 on up for each credit card. Most Americans cannot afford to pour that much into bills. My parents couldn’t. They were able to get into a credit counselor, which allowed them to pay off the debts.

Pretty much the same thing happens to a lot of Americans. They charge a lot of things on their credit cards without much thought. The minimum payment for each card they use slowly increases. After a while, the minimum payment is too difficult to maintain. That’s when the late fees begin to accumulate on each credit card, thus increasing the minimum payment even more. When the late charges hit, the credit rating is hurt and some Americans are forced to file for bankruptcy.

Monthly Mortgages Become Too Much to Bare

Remember the mortgage you got a few years back? The rate was quite low and it seemed doable on your salary. But then the interest rate increased and so did the monthly payments. Homeowners could no longer afford the mortgage that was previously affordable.

This harsh reality has led to many home foreclosures in the United States. Instead of buying a home and staying in it, some Americans are forced to hop from house to house, trying to find a mortgage that they can afford.

The American dream is, of course, to be successful. The way to be successful is to live big by buying a house that sometimes can cost as much as $300,000. With expenses factored in, a mortgage of $1,000 a month is simply too much for many American families to afford. Expensive mortgages are yet another reason for why Americans are going broke.

Car Payments are Too Expensive

Some Americans who drive big trucks or expensive cars are paying $300-$500 a month in car payments. That’s not even with insurance, which can cost another $100-$300 a month. Gas prices have also been on the rise recently, so buying gasoline for the vehicle can cost another $100-$250 a month. All told, an average American family may be spending a $1,000 a month on transportation. That’s simply too much of a strain on their salary, and so many people resort to using credit cards to pay for car payments or gas. Once the cards are maxed out, there is no way to make monthly payments.

Divorces Hurt Finances

When a couple enters into marriage, the finances typically become joint between the couple. This may be good for the marriage, but once the marriage falls apart and the couple divorces, the financial situation worsens.

With the high cost of divorce attorneys and divorce court, many Americans emerge from their divorces with little to no money. This can cause financial ruin for a person, which may lead to bankruptcy or bad credit that will be difficult to repair.

The Cost of Living Has Increased While Many Salaries Have Stayed Constant

It’s a fact that the cost of living has greatly increased over the past 30 years. Many salaries have stayed the same or even decreased in some ways. Things like groceries, utilities and the bare essentials are becoming harder and harder for Americans to afford.

When Americans are not able to afford the necessities, they usually turn to loans or credit cards to cover costs. In the short term, this may be OK, but in the long run, it greatly hurts credit—especially if the person who borrows or charges is unable to pay back the money. It is, thus, another reason why many Americans are going broke.

Workers Lose Jobs

Since many people lack adequate savings, when they lose their job, the results can often be catastrophic. People who have lost their jobs are often unable to pay the bills once they have received their last check. While looking for a new job, they may be forced to take out loans or use credit cards in order to make ends meet. When their credit limit has been reached, they are left with huge stacks of bills. If they haven’t found another job by this point, they are stuck in financial ruin. The last resort for them is to file for bankruptcy.

What Can Be Done?

The only logical solution to the problem of Americans going broke is for Americans to simply realize that they must have certain priorities for their money. They must realize that they cannot live beyond their means, even if they want to.

Priority number 1 should be to provide the things necessary to live a decent life.

Priority number 2 should be to pay the rent and utilities.

Priority number 3 should be to save at least 10% of the salary.

Priority number 4 should be to buy things that may be luxuries—iPods, computers, big screen TVs etc. This should only be done if there is enough income to afford these things and only after all other bills and necessities have been paid for.

Unfortunately, many Americans put the fourth priority at the top of the list and live beyond their means, which is why America is going broke.

http://www.debtreductionlessons.com/pooramerica/

[SummerRain]

Guilty of Credit Cards and Student loans. I mean what other alternative do I have because I could not afford to pay for school even with scholarships and financial aide. Thank God, I never had a credit card balance and my Student loans are going to be paid off soon, inshallah.

Wallahi, I was thinking of buying a condo pretty soon using one of those lariba banks but something was fishy about it when they explained to me how it works. Shidd I would have ended up paying double the mortgage. Currently, although the house prices are very low, the payment are supposed to go upto 30% more. Its just not worth it.


So, whats the punishment for riba? I heard you cant even pray in a house that has riba on it, nor can you eat in it or sleep in it.

[FAH1223]

Thing is, some of these these Islamic Banks deal with Riba too...

its just under a different name, but its the same thing. Some of them don't even let you own the home, just a certain percentage. You can't even decorate or paint... and have all these fees to pay that may as well be usury.

Then you also have Muslim familities of 7 or 8... you can't have them all live in apartments or a small townhouse. You can't have every large family living in such a small environment. Sometimes, owning a home is cheaper than paying the rent to someone.

Also, you get tax breaks for owning your own home. If you rent, you just end up paying money to the government at the end of the year. Owning a home, the value increases and so do the profits you will make if you sell it off. Rent is a waste of money and time.

I'm not for interest and I'm never gonna try to use a lot of credit card or deal with interest in the bank (checking account all the way)... but riba is everywhere by the non-Muslims and even Muslims alike.

Infact, the prophecy of Prophet Muhammad, SAW, has/is coming true that riba will be everywhere and almost everyone will be stained by it

[Koronto91]

Sir-Luggoyo,

You've discussed a very critical topic and one that I see everyday. Here in Atlanta, many Somalis are buying newer homes in the suburbs and going with traditional mortgage companies. There is even a big Real Estate agency founded by a Somali couple that are always advertising themselves on Somali media outlets.

Although it is important to own one's home, blindly buying in to Riba is a major sin. Everytime there is a major conference or sermon at the mosque, one of the questions relates to financing a home/car/student loans, etc. and the answer is always 'NO' but its never enough for certain people.

Ilaaheey Ummadiisa Ha Badbaadiyo, aamiin!

[Sir-Luggoyo]

Ismahan,

In one khutba that I was listening about Riba, the Sheikh said "One morsel of Riba equals to 33 Zinas" Subxaanallah

Alxamdu Lillah I am so proud to say that I never had nor do I intend to have a credit card. What I get is what I spend.

[SummerRain]

[quote="Sir-Luggoyo"]Ismahan,

In one khutba that I was listening about Riba, the Sheikh said "One morsel of Riba equals to 33 Zinas" Subxaanallah

Alxamdu Lillah I am so proud to say that I never had nor do I intend to have a credit card. What I get is what I spend.[/quote]



Wallahi I didnt know it was to that extend. I have to seek forgivness from Allah and close all my credit cards expect for those who have no interest rates on them. Awalba kibir ba uu heestey.

Thanks bro.

[*Arabman]

[Shidd I would have ended up paying double the mortgage.]

Normally, by the time (tens years) you finish off paying the mortgage, you would have paid at least triple the advertised value. It's not just the mortgage; there are the utility, maintenance, repair, garbage collection, insurance, yearly state/city taxes and other payments.

[Also, you get tax breaks for owning your own home.]

It's the other way; you pay tax for owning your own home.

[FAH1223]

[quote="*Arabman"][Shidd I would have ended up paying double the mortgage.]

Normally, by the time (tens years) you finish off paying the mortgage, you would have paid at least triple the advertised value. It's not just the mortgage; there are the utility, maintenance, repair, garbage collection, insurance, yearly state/city taxes and other payments.

[Also, you get tax breaks for owning your own home.]

It's the other way; you pay tax for owning your own home.[/quote]

Yeah.

but you get tax breaks (money back at the end of the year) for owning real estate property such as a home or land. Those who rent, however, end up paying money to the Federal government at the end of the year.

[Koronto91]

FAH123:

You don't have to pay a penny in taxes to the Federal government, I stopped doing this 4 years ago. I give all my taxes to my local masjid and come April 15th I submit my 1040 with the letter of donation from the masjid as an exemption. Somalis should think about this. Its something the Jews have been doing for decades.

[SummerRain]

[quote="Koronto91"]FAH123:

You don't have to pay a penny in taxes to the Federal government, I stopped doing this 4 years ago. I give all my taxes to my local masjid and come April 15th I submit my 1040 with the letter of donation from the masjid as an exemption. Somalis should think about this. Its something the Jews have been doing for decades.[/quote]

LOOOOOOOOOOOOOOOOOl wallahi that is true, my family have been doing that for years. My mother refuses to pay them a penny and rather donates it to the local masjid or other credible organizations. At first, they gave her a hard time and held her tax return for couple of years but when she fought them and submitted the supporting documentations they returned her money back. Ever since then, she has been doing the routine.

[FAH1223]

[quote="Koronto91"]FAH123:

You don't have to pay a penny in taxes to the Federal government, I stopped doing this 4 years ago. I give all my taxes to my local masjid and come April 15th I submit my 1040 with the letter of donation from the masjid as an exemption. Somalis should think about this. Its something the Jews have been doing for decades.[/quote]
wow thats so true

[*Arabman]

http://en.wikipedia.org/wiki/Property_tax#United_States

[FAH1223]

http://www.isnare.com/?aid=174629&ca=Real+Estate