The legal mortgage of gold is a method by which anyone who owns gold, in the event that he faces a financial problem or an emergency situation and needs liquidity, can deal with gold merchants who accept the mortgage. The two parties agree on the selling price and the duration of the mortgage, and the interest that the merchant receives usually ranges between 10 and 20%. The issue is also related to the difference in gold prices.
Circumstance and need
As it is said in Gulf and Arab proverbs, “gold… is an adornment and a treasury,” and one of these meanings is what Ali Hassan, a gold seller, pointed out when he said that the need for financial liquidity is what leads the owners of the gold to mortgage it in the legal way, so they bring the gold to be mortgaged to the merchant. The sale is made according to the appropriate price for the customer and the merchant, and the merchant places it with him according to the agreed-upon period. Once the period expires, the gold is returned and the amount that must be an interest rate for the merchant is received. If the receipt exceeds the agreed-upon period, the merchant displays the gold he has. For sale after the end of the mortgage period.
Agreement between the two parties
Hassan Al-Jufairi, a gold seller, addresses a thread of what his predecessor Ali referred to, but he explains that the method of mortgage is a “sale” with an agreement on a specific price, and he elaborates further, “We buy the item from the customer at a specific price, and after an agreed-upon period has passed, such as a month, for example, The owner of the gold returns to receive it and returns the amount with a percentage of interest to the merchant.”
Regarding the motives for this method, Al-Jufairi says that it is suitable for anyone who wants an immediate sum of money to spend his affairs, and it is a method for many, as the process is carried out by agreement of both parties, as we mentioned above.
“We don’t want it”
Salman Habib, a gold seller, realizes how difficult it is for gold owners to mortgage their gold. Due to the compelling circumstances they are going through, especially for women who inherited heritage or rare gold from their mothers and grandmothers, these are the circumstances that may force them to do so, and when people learned of legitimate mortgage offers for gold, they began to mortgage what they had in exchange for money, a method that served many of them, especially with Possibility of getting their gold back.
Habib adds: But it is unfortunate that some people are unable to pay the amount and the gold becomes the property of the merchant. There are examples of gold that have a special place among women, and are dear to their hearts because of their meanings.
No mortgage or advance
Many jurists have permitted mortgaging gold provided that it is a pledge of allegiance “i.e. buying and selling,” and is not a form of mortgage or advance. The decision to make the pledge of allegiance according to the agreed-upon price rests with the seller, and the gold merchant has the right to keep the gold or jewelry for the period agreed upon between the two parties, but After the expiration of the period, the merchant has the right to sell what he has mortgaged.
