BURLINGTON, Vt.–NorthCountry Federal Credit Union said it is partnering with Guidance Residential to launch a home-financing program that aligns with Islamic principles, which it said will offer a new path to homeownership for Muslims in Vermont.
According to the two organizations, the program is based on an equitable co-ownership model rather than a traditional lender-borrower relationship, and allows homebuyers to enter a partnership contract and enjoy the benefits of homeownership without compromising faith-based principles.
The program adheres to the prohibition of interest, or riba, as required by Islamic faith, the two organizations stated.
“Our community partnerships are vital to ensuring we are creating long-lasting solutions,” Jeff Smith, NorthCountry’s senior vice president of lending, said in a statement. “The Islamic Society of Vermont helped us understand the need for this product — that Muslims were leaving Vermont because a Sharia-compliant mortgage did not exist. They introduced us to Guidance Residential and have worked tirelessly with us to bring this to fruition.”
How Program Was Created
The two organizations said the program was created under the guidance of Islamic scholars and 18 U.S. law firms to ensure it strictly adheres to the legal jurisprudence of the Islamic faith and conforms to U.S. legal and regulatory requirements.
Guidance Residential is a leading provider of U.S. Islamic home financing, having provided more than $10 billion in financing to more than 40,000 families since 2002, the company said.
The $1-billion NorthCountry Federal Credit Union has approximately 78,000 members primarily in Vermont, New York and New Hampshire.
