HALAL LOAN FOR OVER-INDEBTED

HALAL LOAN FOR OVER-INDEBTED

ISLAMIC LOAN FOR OVER-INDEBTED HALAL LOAN IN CASE OF OVER-INDEBTDNESS

An Islamic loan for over-indebted is by definition a halal credit facility which is provided through an Islamic lender for a Muslim borrower who cannot service his or her debt on time, as well as being not able to fulfil the financial obligations regularly

An Islamic loan for over-indebted intervenes normally when a Muslim consumer or household is unable to meet their financial responsibilities as the debt repayments becomes higher than the regular revenues, only in case the Muslim overindebted didn’t contribute intentionally to his or her over-indebtedness.

A Halal loan has the objective in the context of ethical finances to avoid Muslims land in over-indebtedness as Islamic lending protects against over-indebtedness at all costs by only offering loans that the borrower can afford to repay.

An Islamic loan is excluding an option that might lead to generate over-indebted households like conventional credit facilities do.

The reasons why halal loans are not producing any over-indebtedness is that they will never grant:

  • Bank overdraft.
  • Short-term consumer loans (revolving facilities).
  • Interest rates plunging the consumer month by month into over-indebtedness deteriorating his or her credit score.