11 Tips to avoid RIBA

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The Prophet, upon him be peace, taught, “A time will come over people when not a
one of them will remain other than consumers of interest; and even those who do not
consume it will be effected by its dust.”
This hadith was related by Abu Hurayrah and was included in the collection of Ibn Majah,
Kitab al-Sunan (2269).
Have you realize that we are in these times?
Isn’t it strange how a Muslim will strictly stay away from eating pork because it is haram, yet the same person has no problem devouring riba (otherwise known as usury or interest)?
“…but whoever returns (to dealing in Riba), such are the dwellers of the Fire- they will abide therein”. (Surah Baqarah, verse 275).
Riba brings hardship into this life, but much more importantly and frighteningly are its consequences in the grave and akhirah (the Hereafter).
Buying big things today like houses, cars and even sometimes taking personal loans lands us to RIBA. Long term interest that’s causing major problems these days. There are many problems that arises from RIBA such as many cases of family breakdowns, suicide, homelessness and the list goes on. I would not want to say that this is the source of all problems. It could be but its not just that.
Allow me to share a personal experience. I just came back from my reservist training and being a Lieutenant I have to listen to all the problems the men under me faced. One of the most heartening case was he lost his job for almost 3 months now and because he has all the expenses like mortgages and day to day meals, he had used his credit cards to settle them ending almost more than 10 thousand dollars of bills. Using credit cards was definitely the killer due to the interests the banks had on him. What’s worse is that its not just one credit card but more than 3. Furthermore he has to support his family.
I am very sure that this does not just happen to him and there are many people out there who are in the same boat. In fact more and more people today who are not educated tend to fall into these traps. It could be you too.
Where are we going wrong? Let’s ask ourselves these questions.
Are we supporting the Systems that further escalates our problems?
Do you actually know that you are supporting systems that is causing this problem?
Are we making sure that we don’t put our money in places that continually generate RIBA?
If we are not able to fully get out from RIBA, can we minimize and hopefully someday we can be out of it?
These are questions that you may want to ask and seek answers to and to be honest there is no one exact solution in this complex environment.
How can we get ourselves out in this situation?
I’ve found some answers from ProductiveMuslims.com. The tips are:
Having tawakkul that Allah will provide for you and your family
Not taking out loans which incur interest
Choosing halal investments (for example gold rather than the stock market)
Renting and saving the cash for a home instead of a mortgage
Being wary of contracts you sign and having a student of knowledge/imam/shaykh check them
Opening up bank accounts without interest (in other words, chequing accounts)
Making bill payments on time so as not to incur a late penalty (set your account to automatic payment so the bank will automatically withdraw and you will be sure to not pay late)
Borrowing money from family or friends where possible
Not buying what you simply don’t have the money for – live within your means
Dealing with Islamically compliant banks
Accepting/Organizing a “Goodly Loan” (al Qard al Hasanah), which is a loan by means of which one intends to show kindness to another, which does not involve taking Riba
You may also consider attending seminars and events on Halal Investments and learning from others how they have done it to get out of the current RIBA systems.
Bank greed sees homes being sold for as little as R10 !

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Rashida Ntotela – Cii News | 05 Safar 1437/18 November 2015
A mortgage is a haraam riba-based transaction that is based on a loan with interest in which the owner of the money takes as collateral the property for the purchase of which the borrower is taking out the loan, until the debt has been paid off along with the interest (riba).
As a Muslim who bows his head to his Creator it is a serious dilemma: How to obey Him completely in our financial dealings in a world that revolves around interest (Riba).
Usury poses a serious threat to our living and is a reality that most people encounter.
With the current economic crises, one can easily fall victim to not being able to manage a bond repayment that was probably well within your affordability when you initially purchased the property.
While banks often reject allegations that they care little for ordinary South Africans, it is evident that these institutions are presiding over a number of flagrantly repugnant practices, including houses being sold off at a fraction of their value – with the worst case being a house sold for just R10.00!
Johannesburg – FNB sells R 1, 4 million property for R 10 000
A property belonging to a now penniless Mike Rensveld was auctioned after a lengthy battle with the banks in order to reclaim his property.
Having raised R 73 000 to cover the shortfall, the bank rejected the amount, and in a space of 5 years the banks valuation for the property dropped from    R 1.4 million, to R 500 000 . Subsequent to that, his home was auctioned for a lousy R 10 000.
NewERA’s advocate, Douglas Shaw, with expertise in the application of the National Credit Act, Liquidation and Insolvency Act, Debt Counselling Law, and the Deeds Registries Act, spoke to CII Radio on some of the implications of people who have lost assets to banks in this way, our rights as consumers, and upcoming court cases that could bring relief to South Africans.
“Banks often auction properties at a low price. They do this to collect just enough to pay the bank back” said Shaw.
“It is quiet ridiculous, but unfortunately happens all the time in this country.”
The average of all cases that banks auction in a year is sold at a measly 90% and 95 % of the real price, he said.
In a comparative analysis to other countries , Shawn found that countries like Germany ,England and America have stringent regulations and systems in place in terms of safeguarding ordinary people from the ruthless acts i.e ‘repossessions’ and auctions of banks.
“They (banks) terrorise people for years afterwards to try and get them to pay the balance… and it wipes them off completely financially!”
Shaw also believes that it is unfair and unconstitutional for a bank to chase the client for any shortfall after they have sold the property for a low amount.
Banks need to be held accountable for the price gained on auction, continues argued, asserting that this kind of behaviour was not acceptable.
Without proper regulation, he said, banks had become a law unto their own.
Literally thousands of people, Shaw revealed, have been affected by such auctions in South Africa.
“Roughly Between 10 000 houses are auctioned a year, and 20 000 during the recession” Shaw said.
As if this is not colossal enough, underhand dealings take place at auctions and ordinary people are kept away by shady characters. This is morally obscene, Shawn asserted,  “people must be informed of their rights.”
That is how they are ripped off of their property. “Ordinary people somehow never see these bargains, property selling for 90% or less.”
Accordingly, “rules of court need to be changed to bring it in line with the kind of changes in other countries that have made their law consumer friendly.”
Despite the hardships and intolerance that may come with banks, they remain the power house for help if you are having problems with your bank. Nevertheless, we need to work with them, but put pressure to change the system Shaw aspirantly said.

 
The Prophet, upon him be peace, taught, “A time will come over people when not a
one of them will remain other than consumers of interest; and even those who do not
consume it will be effected by its dust.”
This hadith was related by Abu Hurayrah and was included in the collection of Ibn Majah,
Kitab al-Sunan (2269).
Have you realize that we are in these times?
Isn’t it strange how a Muslim will strictly stay away from eating pork because it is haram, yet the same person has no problem devouring riba (otherwise known as usury or interest)?
“…but whoever returns (to dealing in Riba), such are the dwellers of the Fire- they will abide therein”. (Surah Baqarah, verse 275).
Riba brings hardship into this life, but much more importantly and frighteningly are its consequences in the grave and akhirah (the Hereafter).
Buying big things today like houses, cars and even sometimes taking personal loans lands us to RIBA. Long term interest that’s causing major problems these days. There are many problems that arises from RIBA such as many cases of family breakdowns, suicide, homelessness and the list goes on. I would not want to say that this is the source of all problems. It could be but its not just that.
Allow me to share a personal experience. I just came back from my reservist training and being a Lieutenant I have to listen to all the problems the men under me faced. One of the most heartening case was he lost his job for almost 3 months now and because he has all the expenses like mortgages and day to day meals, he had used his credit cards to settle them ending almost more than 10 thousand dollars of bills. Using credit cards was definitely the killer due to the interests the banks had on him. What’s worse is that its not just one credit card but more than 3. Furthermore he has to support his family.
I am very sure that this does not just happen to him and there are many people out there who are in the same boat. In fact more and more people today who are not educated tend to fall into these traps. It could be you too.
Where are we going wrong? Let’s ask ourselves these questions.
Are we supporting the Systems that further escalates our problems?
Do you actually know that you are supporting systems that is causing this problem?
Are we making sure that we don’t put our money in places that continually generate RIBA?
If we are not able to fully get out from RIBA, can we minimize and hopefully someday we can be out of it?
These are questions that you may want to ask and seek answers to and to be honest there is no one exact solution in this complex environment.
How can we get ourselves out in this situation?
I’ve found some answers from ProductiveMuslims.com. The tips are:
Having tawakkul that Allah will provide for you and your family
Not taking out loans which incur interest
Choosing halal investments (for example gold rather than the stock market)
Renting and saving the cash for a home instead of a mortgage
Being wary of contracts you sign and having a student of knowledge/imam/shaykh check them
Opening up bank accounts without interest (in other words, chequing accounts)
Making bill payments on time so as not to incur a late penalty (set your account to automatic payment so the bank will automatically withdraw and you will be sure to not pay late)
Borrowing money from family or friends where possible
Not buying what you simply don’t have the money for – live within your means
Dealing with Islamically compliant banks
Accepting/Organizing a “Goodly Loan” (al Qard al Hasanah), which is a loan by means of which one intends to show kindness to another, which does not involve taking Riba
You may also consider attending seminars and events on Halal Investments and learning from others how they have done it to get out of the current RIBA systems.
Bank greed sees homes being sold for as little as R10 !

Rashida Ntotela – Cii News | 05 Safar 1437/18 November 2015
A mortgage is a haraam riba-based transaction that is based on a loan with interest in which the owner of the money takes as collateral the property for the purchase of which the borrower is taking out the loan, until the debt has been paid off along with the interest (riba).
As a Muslim who bows his head to his Creator it is a serious dilemma: How to obey Him completely in our financial dealings in a world that revolves around interest (Riba).
Usury poses a serious threat to our living and is a reality that most people encounter.
With the current economic crises, one can easily fall victim to not being able to manage a bond repayment that was probably well within your affordability when you initially purchased the property.
While banks often reject allegations that they care little for ordinary South Africans, it is evident that these institutions are presiding over a number of flagrantly repugnant practices, including houses being sold off at a fraction of their value – with the worst case being a house sold for just R10.00!
Johannesburg – FNB sells R 1, 4 million property for R 10 000
A property belonging to a now penniless Mike Rensveld was auctioned after a lengthy battle with the banks in order to reclaim his property.
Having raised R 73 000 to cover the shortfall, the bank rejected the amount, and in a space of 5 years the banks valuation for the property dropped from    R 1.4 million, to R 500 000 . Subsequent to that, his home was auctioned for a lousy R 10 000.
NewERA’s advocate, Douglas Shaw, with expertise in the application of the National Credit Act, Liquidation and Insolvency Act, Debt Counselling Law, and the Deeds Registries Act, spoke to CII Radio on some of the implications of people who have lost assets to banks in this way, our rights as consumers, and upcoming court cases that could bring relief to South Africans.
“Banks often auction properties at a low price. They do this to collect just enough to pay the bank back” said Shaw.
“It is quiet ridiculous, but unfortunately happens all the time in this country.”
The average of all cases that banks auction in a year is sold at a measly 90% and 95 % of the real price, he said.
In a comparative analysis to other countries , Shawn found that countries like Germany ,England and America have stringent regulations and systems in place in terms of safeguarding ordinary people from the ruthless acts i.e ‘repossessions’ and auctions of banks.
“They (banks) terrorise people for years afterwards to try and get them to pay the balance… and it wipes them off completely financially!”
Shaw also believes that it is unfair and unconstitutional for a bank to chase the client for any shortfall after they have sold the property for a low amount.
Banks need to be held accountable for the price gained on auction, continues argued, asserting that this kind of behaviour was not acceptable.
Without proper regulation, he said, banks had become a law unto their own.
Literally thousands of people, Shaw revealed, have been affected by such auctions in South Africa.
“Roughly Between 10 000 houses are auctioned a year, and 20 000 during the recession” Shaw said.
As if this is not colossal enough, underhand dealings take place at auctions and ordinary people are kept away by shady characters. This is morally obscene, Shawn asserted,  “people must be informed of their rights.”
That is how they are ripped off of their property. “Ordinary people somehow never see these bargains, property selling for 90% or less.”
Accordingly, “rules of court need to be changed to bring it in line with the kind of changes in other countries that have made their law consumer friendly.”
Despite the hardships and intolerance that may come with banks, they remain the power house for help if you are having problems with your bank. Nevertheless, we need to work with them, but put pressure to change the system Shaw aspirantly said.

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