Prohibition of Taking/Paying Interest

Motek

Sun, May 22 2005, 10:22 am

I heard two situations this week regarding mortgages and the Torah prohibition of interest. I don't understand the technicalities involved but want to tell you these stories so that you can ask your rabbi your own questions if you think it's relevant.

Situation #1 - a woman said her son bought a house and being a lawyer and on top of the small details he discovered that his bank had sold his mortgage to another bank. Upon further investigation, he discovered that the bank that his mortgage had been sold to was in Ohio and was owned by three Jewish brothers. He contacted a rabbi in Ohio and it was a whole involved story because of the prohibition of interest and the Jews involved.

Situation #2 - someone said that at a shiur she went to, the rav said that when a couple can't buy a house under their own name because they don't have a good credit rating, and so the house is bought by the parents and the couple pays the parents each month to cover the mortgage, this is a serious problem of ribis (interest)

again, I cannot answer any questions about why these two situations are problems, ask a rav if it applies to you!

SMG

Sun, Dec 11 2005, 10:19 pm

When we bought our first house, my FIL paid for it with money from one of his retirement accounts. We were given a heter (maybe it was called a heter iska?) from our Rav who said we could not pay him back interest, but we could pay the amount that he would have made in interest if the money was still in the account. It doesn't sound like much of a difference, but there was some technicality that made it halachically okay.