My son who learns in kollel is thinking of buying a property. Because he cannot borrow money with his income, I will borrow the money from my bank, using my home. There will be a mortgage document drawn up legally showing that he owes me the money. What do I note on the document where it talks about interest payment? Are we allowed to put an interest rate even though there will be a Heter Iska document signed seperately?
Answer:
The question is not entirely clear to me: Surely you or he will be paying interest to the bank, and he won’t be paying you any interest?
If an interest payment requiring a heter iska is recorded, it should be noted at the end of the document (or in a footnote, etc.) that all interest payments are made in accordance with a heter iska, as required by Jewish Law. A separate heter iska is then drawn up referring to the agreement made.
Best wishes, and please submit another question if this answer is in any way unclear.
