Muslim Prohibition on Paying Interest Creates Challenges for Homeownership

May 18, 2000

Source: Star Tribune

On May 18, 2000, the Federal Reserve Bank in Minneapolis will be hosting a daylong meeting entitled, "Homeownership 2000: Meeting the Needs of New Communities" which will include a cooperative model for Islamic financing that is working in Toronto, New York City, Houston, the United Kingdom, and Australia. Minnesota's Muslim population has doubled over the past five years, mostly due to a large number of African Muslim immigrants. The Minneapolis branch of the U.S. Department of Housing and Urban Development (HUD) has recognized the challenges that many Muslim immigrants face in buying homes in the region, which in addition to obstacles of low income, poor credit history, and lack of information, also includes the prohibition against paying interest. Minneapolis HUD offices have now formed a committee to study the issue and will try to offer services and solutions geared for the Muslim community.