All About the Fatwa

The idea behind the Fatwa was developed early on in the evolution of Islam as a means of interpreting questions pertaining to the law as it pertains to following Sharia Law or Islamic Law. In simple terms, it’s a legal opinion issued by a mufti and centers around Islamic Law and how it relates to the whole Islamic loan process that forbids Riba or making money from interest on loans. The origins of these Fatwas are different than pronouncements that come from lawyers or judges. Although in this case, they concern themselves with the Islamic finance process, the conclusions that these learned scholars come to are based on the evidence that is given to support their claims, and in some cases, there is even conflicting evidence given to support them. Because Islam is not very hierarchical in structure, even the fatwas, or Fatawah, expressed about Islamic finance and Sharia law are not always consistent.
The nature of these Fatwas as they apply to take out a loan or mortgage to buy a house that deals with a bank or other financial institution that charges interest are uninformed, however. It’s referenced in Surah At-Talaq 65:2-3 and used by muftis to demonstrate the evils and what can befall an individual if they take this course of action.
When any Muslim has decided to follow any particular Mufti, the Fatwas issued by that scholar are generally considered to be binding whether they pertain to Islamic finance or not.
Recently there have been several steps taken by contemporary Muftis to make the modern Sharia law process as it pertains to Islamic financial matters more easily understood as Muslim finance becomes a global force. These fatwas must always be supported by a body of evidence and be defended by the muftis that have issued them.
As these rulings pertain to Islamic finance, there is a consensus that all these fatwas must be carefully thought out since reversals could lead to disruptions in the Islamic banking sector in general that could adversely affect Islamic loans and other financial products.

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