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Investing Capital In Expectation Of Percentage Payout
May I take a loan in which the lender makes a monetary investment in expectation of a percentage payout?
It is impermissible to take any kind of loan in which the lender makes a monetary investment in expectation of a percentage payout, because invariably some difference will occur between the investment and the payout, a difference that constitutes riba (e.g. a home equity loan that invests $10,000 in a property in return for 10% of the property's selling price); it would be permissible to instead ascribe a percentage figure to a monetary investment and make a payout at the same percentage (e.g. a home equity loan that invests $10,000, or 10%, in a property in return for 10% of the property’s selling price), provided both lender and borrower share in any damages (not caused by any particular individual's negligence) to the property to the extent of their ownership share.

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