Shariah Rulings on Mortgage (item 3)

Mortgage is permissible when the debt transaction takes place while the two parties are on travel because Allah, the Almighty, says: {“I And if you are on a journey and cannot find a scribe, then let there be a pledge taken (mortgaging)…”}. Mortgage is also permissible when the contracting parties are not on travel, because Anas is reported to have said: “The Prophet (peace be upon Him) mortgaged his armor plate to a Jew in Al-Madinah and took some barley from him to his family”. In this regard Ibn Al-Mundhir said: “I do not know anyone, except Mujahid, who held a different interpretation for the Verse: {“...if you are on a journey ...etc”}. Traveling (adds Ibn Al-Mundhir) is referred to in the Verse as the predominant case where mortgage is needed, since traveling parties would most probably be in lack of a scribe. Hence the verse, although it mentions traveling, it does not stipulate it as a condition for concluding mortgage contracts. Mortgage is also not obligatory, a fact which - to my knowledge - has encountered no dispute. The emphasis on mortgage in the Verse indicates guidance rather than obligation, because Allah, the Almighty, says: {“and if one of you deposits a thing on trust with another”}.

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