Koran-friendly U.S. Bankers Lend Interest-Free Loans.

Who wouldn't want an interest-free loan? I think we all dream of getting our hands on interest-free loans. The best you probably could have mustered was anywhere between 5 and 6 percent for a 30 year mortgage loan. Or may 4 percent for a 15-year loan. But, if you happen to be a devout Muslim, (what about those who convert to other religion from Muslim? They get the ax or what?) you are forbidden to pay any form of interest or "riba" according to the February 14, 2005 Business Week edition. This is an example of either showing good financial stewardship or having this irrational fear of debt-phobia. Probably worse than the mafia who will break your knee caps if you don't pay up that 40% interest loan. Now, imagine the quandry of Muslim-Americans who want to own their own homes debt-free, essentially so.

Ok. You can stop imaging the quandry.

Saving to pay for a home in full when housing prices are skyrocketing is nearly impossible for those who do not believe in paying interests.

Maybe move to middle America and get some cheap housing?

But the works are in the works where Koran-compatible "Islamic banking" is coming to the U.S. But the biggest irony is that Devon Bank, who is leading the way, is a small community bank in Chicago owned by the Loundy family, who are Jewish. Now, isn't that a hoot?

In January, Freddie Mac (FRE ) agreed to buy Devon's Islamic home financing products. But isn't Devon's Islamic home financing products are the brainchild of the Loundy family who are Jewish?

Devon also is working with Fannie Mae (FNM ) to develop Koran-compatible home mortgage products.

Ok. Great. Now I can see it now. More reasons for Muslims to go after Jewish people using the Devon Bank as proof that Jewish people are trying to rule the world.

According to Business week, other banks are starting to offer Islamic services in the U.S., including the University Bank in Ann Arbor and HSBC in New York.

They are? Interest-free loans? Isn't that like saying "deafening silence"? Isn't Devon Banking an example of an oxymoron?

Business Week describes that,

Devon, on Chicago's North Side, anchors a neighborhood that has shifted from Eastern European Jews to Indian, Pakistani, and Middle Eastern Muslims. To meet customers' needs, the bank, which has $261 million in assets, spent two years developing financial products that could conform to Islamic laws and pass the financial scrutiny of U.S. regulators.

Guess who moving out and those who are moving in?

The Devon bank, which has $261 million in assets, spent two years developing financial products that could conform to Islamic laws and pass the financial scrutiny of U.S. regulators.

But I wonder if they also conform to Shari'a law concerning debts? But according to Business Week, under "Murabaha", or installment financing, this is how it works:

Devon buys a property chosen by a customer, then turns around and sells it for a price that includes projected interest costs. There is no principal and thus, technically, no interest. Islamic financing is nearly half of Devon's mortgage portfolio. The bank also offers Koran-friendly financing for commercial real estate, business equipment, and letters of credit. "We are a community bank helping a community that's being underserved," says David Loundy, the bank's legal counsel. "In this case it's the Muslim community." Given an estimated 6 million Muslims in the U.S., that's bound to change.

Technically, no interest? Isn't that like "cooking the books" just so that Muslim-Americans can get away from paying any debts that would clash with their religious Koranic beliefs?

Somebody's making money in this loan scheme. Money is being made and nothing is ever free. Somebody's paying interest, whatever the disguise is. You've heard the lawyer jokes and how much money they make in making the victims (i.e. "their clients") pay? Bankers are certainly next in line. It's too good to be true to get an "interest-free" loan from, what else, a banker.

Hey! I want an interest-free loan, too!