How is the LARIBA Model different from Other Models Used by Conventional Riba Banks and Mortgage Companies?
1. The ability of the borrower to repay by evaluating income and expenses of the borrower, and 2. The willingness and track record of the borrower to meet their commitments as reflected by the credit reports. Then the process differs drastically. For the Riba Conventional, if one qualifies the Banker will need to start by defining: 1. The Amount of the Loan, 2. The Number of Years of Repayment, and 3. The Rent of the Money, called Interest Rate. The profit he makes by renting the Bank’s money to the borrower. The Conventional Banker inputs the above data in a computer (amortization) program and solves for the Monthly Payment consisting of Repayment of Principal and the interest on the money. In contrast, the LARIBA Model starts by asking the homebuyer to: 1. Define the location, address and specification of the house they intend to buy, 2. Survey the rent of a similar properties in the neighborhood and come up with three independent estimates from reliable documented sources. And the L
