Clarifications On Mortgages Contracts
Bank’s giving it the name interest or markup or not writing in paper the ownership doesn’t change the nature of this transaction. If the amount were loan, the bank should have nothing to do with the use for the amount. Instead the bank makes it only for a commodity like car or house. Rates are fixed or variable doesn’t make a transaction sood. The only thing to consider is if the transaction or a business involves an intention or act to harm or deceive the other party. If not then it is a lawful one.
According to our understanding, sood is only the case of loan. This transaction is not loan at all. Therefore the question of additional amounts to principal amount is not sood but profit which the bank earns against time it gives to pay off the price of the commodity. The price is fixed or subject to inflation, both are fine and justified.