StructureLARIBA described its model as 'Declining Participation in Usufruct'. Its own pages are no longer online (lariba.com now redirects to UIF), and the earlier descriptions we had conflict on whether LARIBA ever held a share of title or only a lien, so we do not restate them. Since 1 April 2026 LARIBA's customers are served by UIF.
A pioneer of US faith-based home finance (1987) — but AMJA ruled the legacy LARIBA contract IMPERMISSIBLE, finding it 'does not differ from a traditional mortgage'. As of 1 April 2026 LARIBA was merged into UIF; new originations now run through UIF's structures. Treat as legacy/absorbed and verify which entity's contract you would actually sign today.
Provider’s website ↗Provider white papers, FAQs or fatāwā were read, but the executed contract itself is not public. This rates our certainty, not the provider’s compliance.
The five questions
How it answers, at a glance
Which contract
Unclear“the earlier descriptions we had conflict on whether LARIBA ever held a share of title or only a lien”
Who holds title
Not disclosed“conflict on whether LARIBA ever held a share of title or only a lien”
How the price or rent is set
Not disclosed“Earlier descriptions say rent was set from market rental estimates rather than an interest index (not re-verifiable)”
What happens on default
Not publicly documented“no executed LARIBA contract, note or lien instrument is public”
Independent scholarly ruling
Not approved / impermissible“AMJA 2014 resolution: LARIBA ruled IMPERMISSIBLE — the committee found its contract 'does not differ from a traditional mortgage' despite Islamic presentation.”
Note: Merged into UIF on 1 April 2026 rather than collapsed. Its contract documents are no longer online, so only AMJA's rulings are verifiable.
See how it compares across the US, UK and CanadaEstablished & regulatory standing
The verifiable facts
Established
Founded 1987 (Pasadena/Whittier, CA) around Dr. Yahia Abdul-Rahman — a pioneer of US faith-based home finance. Acquired by University Bancorp and merged into UIF on 1 April 2026 (University Bancorp reported LARIBA's total assets as $17,683,000, unaudited, at 30 September 2025).
Regulatory standing
Historically a California non-bank finance company affiliated with Bank of Whittier, N.A. Post-April-2026 it is part of UIF / University Bank (FDIC-member parent). New originations now run through UIF; legacy LARIBA accounts are serviced by Midwest Loan Services. NMLS state licensing.
Shariah board
Who certifies it
No named LARIBA Shariah board could be verified; its pages are no longer online. UIF's board, named on UIF's fatawa page, governs UIF products.
A named, credentialled board is a real signal — but a provider’s own board certifying its own product is not the same as arm’s-length review. Weigh it alongside the independent commentary below.
Independent scholarly review
What independent scholars have said
AMJA 2014 resolution: LARIBA ruled IMPERMISSIBLE — the committee found its contract 'does not differ from a traditional mortgage' despite Islamic presentation. In an October 2023 update on the same AMJA page, the committee said it "maintains its stance on the updated Lariba contract, deeming it impermissible".
Independent commentary is weighed, not treated as a final personal ruling. A body that rules one way is one respected voice, not a universal consensus — and rulings can lag changes to a live contract.
How the structure works
The mechanics, in principle
LARIBA described its model as 'Declining Participation in Usufruct'. Its own pages are no longer online (lariba.com now redirects to UIF), and the earlier descriptions we had conflict on whether LARIBA ever held a share of title or only a lien, so we do not restate them. Since 1 April 2026 LARIBA's customers are served by UIF.
This describes the structure in principle — it is not a verdict on the executed contract. How the contract actually behaves is what the checklist below tests.
From the public documents
How the contract actually works
Read from American Finance House LARIBA’s own public materials — white papers, product pages, FAQs and fatāwā — not its executed contract, which is generally not published. Where a point is undisclosed, it is said plainly rather than guessed. Sources are listed below.
LARIBA's own pages are no longer online (lariba.com now redirects to UIF), so its contract terms cannot be re-read, and an earlier version of this entry quoted them from search-engine summaries, which this site does not accept as sources. Earlier descriptions, which we could not verify against a primary page, said the client granted LARIBA a lien on the property and signed a promissory note, with rent set from market rental estimates for comparable properties rather than an interest index. If that is accurate, the legal form is closer to a secured loan with a profit-rent overlay than to co-ownership on title, which fits AMJA's 2014 finding that the contract "does not differ from a traditional mortgage" and its October 2023 update maintaining that the updated contract is impermissible. Since 1 April 2026 LARIBA's customers have been served by UIF. Honest limit: no executed LARIBA contract, note or lien instrument is public, and the descriptions above are not verified.
The Six-Pillar test
The questions that decide it
This is the universal lens this site applies to every home-finance contract, anywhere. Read each pillar as a question to put to American Finance House LARIBA’s executed contract — not its brochure.
- 1
Real ownership
Does the financier genuinely take ownership of the asset — even briefly — and bear a real owner's risk, rather than only ever holding a debt secured against it?
- 2
Risk-sharing
If the asset is destroyed or its value collapses, does the financier share that loss in proportion to its stake, or is the customer left bearing it alone?
- 3
Rent vs interest
In a lease/co-ownership, is the rent benchmarked to a genuine market rent for the property — or is it calibrated to an interest rate (a base-rate + margin) in disguise?
- 4
Default mechanism
On default, does the contract behave like the end of a real lease/partnership — or does it accelerate like a loan, demanding the full outstanding 'principal' plus charges?
- 5
No guaranteed pre-fixed return
Is the financier's return tied to real ownership and risk, or is it a pre-fixed, guaranteed sum that arrives regardless of what happens to the asset?
- 6
Substance over form
Strip away the Arabic labels: does the cashflow, risk, and outcome differ from a conventional loan — or is it the same economics wearing a compliant name (ḥiyal)?
Before you sign
What to ask American Finance House LARIBA, in writing
Put these to the provider in writing and keep the answers. The reply — not the marketing — is what tells you whether the structure holds.
Since LARIBA is now UIF, which entity's contract and structure would I actually sign today, and is it UIF's mushārakah?
Given AMJA ruled the legacy LARIBA contract impermissible, how does the current product differ structurally?
Who holds title and how is profit/rent computed versus a conventional amortisation schedule?
Who services my account now (Midwest Loan Services) and do original terms truly remain unchanged?
Which named scholars certify the product I would receive post-merger?
The honest gap
What we have not verified
- Whether legacy LARIBA contracts (AMJA-impermissible) are being restructured or simply serviced as-is under UIF.
- Whether the historical model was substantively distinct from interest or only formally so (its documents are no longer public).
- What independent Shariah oversight governs former-LARIBA customers now.
The reasoning
Why this verdict, and not another
A verdict is only as honest as the reasoning behind it. Here is why American Finance House LARIBA sits where it does — what keeps it off a clean pass, and what keeps it off an outright avoid.
Not a clean pass because
AMJA ruled the legacy LARIBA contract impermissible, finding it “does not differ from a traditional mortgage”, and maintained that ruling for the updated contract in October 2023.
Not an outright avoid because
Earlier descriptions say rent was set from market rental estimates rather than an interest index (not re-verifiable), and since 1 April 2026 customers are served by UIF, whose structures differ, so what you would sign today may differ.
Sources
What this read is built on
The verifiable references behind this page — provider documents and independent scholarly resolutions. Read them yourself; do not take our summary on trust.