Some Muslims are calling “Sharia-compliant” mortgages “fraud.” Critics say they are nothing more than mortgages with front-loaded interest. Interest is prohibited in Islam.
Sharia-compliant mortgages are also up to 1-3% more expensive than conventional mortgages in Canada, according to the Financial Post. In the United States, they cost only 0.4%-1% more.
That said, there is apparently high demand for such products. Bank of Nova Scotia and TD are both considering offering them and UM Financial, a Muslim lender from Toronto, reportedly has a 5000 person waiting list.