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A Board Member of a not-for profit is going to mortgage his personal property to enable the not for profit to make substantial capital improvements in their facilities. He wants the not for profit to pay the mortgage. Isn’t that ossur?


Correct, there is an issue of ribbis here since the person mortgaging his home is essentially taking the loan from the bank, (unless your situation is different) and he is then lending the money to the nonprofit. Therefore when they pay the bank interest, they are essentially paying him back more than the sum of the loan, which is ribbis. If the mortgage was not taken yet, they can sign a heter iska. It should be signed between the person who is taking/giving the loan, and the members of the not for profit, who are going to, make the mortgage payments.  They should sign the following agreement. 

We, the undersign (the members of the not for profit) ____________ verify that we got sum of $_______ for an iska, from (the person who is giving mortgaging his home) _________to improve the no for profits facility. The profit of the iska is the amount of interest and all expenses that the bank __________ is going to demand for the loan that (the person who is giving mortgaging his home) ____________. Additionally, the iska that we are now doing should be in accordance with the heter iska written in the sefer Bris Pinchos.

If however the loan was already taken, then things are different and more complicated, and re-ask the question. 

Best Wishes


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