Convert your auto financing to a halal, riba-free structure
IjaraCDC’s Auto Conversion Program allows Muslim families to convert an existing conventional auto financing agreement into a sharia-compliant Murabaha (Installment Sale) structure, without taking out new financing or changing your monthly payment amount.
What is an auto conversion?
An auto conversion changes the legal and financial structure of your existing auto financing, not the economics. Your monthly payment stays the same.
What changes is the nature of the transaction: a conventional auto financing arrangement charges interest (riba), which is prohibited under Islamic law. IjaraCDC converts it into a Murabaha (Installment Sale): you are purchasing the vehicle through a halal installment agreement instead of paying riba on borrowed money. The result is functionally identical in monthly cost but structurally compliant with Sharia.
How the auto conversion works, step by step
Five steps from applying online to halal auto financing, with no change to your monthly payment.
Apply online
Submit the auto conversion application on this page. Provide your current financing details.
Application review
The team reviews the terms of your existing auto financing and confirms eligibility for conversion.
Conversion agreement issued
IjaraCDC issues a Murabaha (Installment Sale) agreement that restructures your transaction from riba-based to halal.
Pay the one-time conversion fee
A one-time $295 fee covers the conversion. A $7.50 monthly admin fee applies going forward.
Your financing is now halal
Your monthly payment amount stays the same. The structure of the transaction is now sharia-compliant and Murabaha-based.
Conversion fees
One fee to convert and a small monthly admin fee. Your existing monthly payment does not change.
- One-time conversion fee
- $295
- Monthly admin fee
- $7.50
- Change to monthly payment amount
- None, your payment stays the same
- New financing required
- No
Apply for the Auto Conversion Program
Ready to make your auto financing halal? Apply below. US and Canadian applicants are welcome. For questions, call 1-877-86-IJARA.
Apply in the US
For vehicles financed in the United States. Have your current financing details ready.
Apply in Canada
Canadian applicants use a separate application. Have your current financing details ready.
Why Muslim families and businesses choose IjaraCDC
Six reasons families and businesses have financed riba-free with us since 2005.
Questions about the halal auto conversion
Not sure your financing qualifies? Call 1-877-86-IJARA and our team will check before you apply.
What is a halal auto conversion?
A halal auto conversion restructures an existing conventional auto financing agreement into a sharia-compliant Murabaha (Installment Sale) transaction. IjaraCDC converts your interest-bearing (riba-based) auto financing into a halal structure without changing your monthly payment amount. The one-time fee is $295, plus $7.50 per month in admin fees.
Do I need to take out new financing to convert my auto financing to halal?
No. IjaraCDC’s Auto Conversion Program does not require new financing. The program converts the structure of your existing auto financing agreement from riba-based to a Murabaha (Installment Sale), a halal, sharia-compliant structure. Your monthly payment amount does not change.
Is IjaraCDC’s auto conversion sharia compliant?
Yes. The Auto Conversion Program is reviewed and approved by IjaraCDC’s Sharia advisory board. IjaraCDC is a 501(c)(3) nonprofit that specializes in sharia-compliant financing, and all products comply with the Islamic prohibition on riba (interest).
How much does the halal auto conversion cost?
The IjaraCDC Auto Conversion Program costs $295 as a one-time conversion fee, plus $7.50 per month in admin fees. Your existing monthly auto payment amount does not change.
What is Murabaha and how does it make auto financing halal?
Murabaha is an Islamic financing structure where a transaction is structured as an Installment Sale rather than a riba-bearing arrangement. In a Murabaha auto conversion, IjaraCDC converts your existing financing from a “rent on money” (riba/interest) transaction to a halal Installment Sale. This restructuring makes the transaction compliant with Islamic law while keeping your payment amount the same.
Is the halal auto conversion available in Canada?
Yes. IjaraCDC offers the Auto Conversion Program in Canada through a separate application. Canadian applicants can apply via the Canada application link on this page or call 1-877-86-IJARA for assistance.
What vehicles or financing types qualify for conversion?
Contact IjaraCDC at 1-877-86-IJARA or apply online to confirm your specific financing qualifies for conversion. The program is designed for existing conventional auto financing agreements that the applicant wishes to restructure into a sharia-compliant Murabaha.
How do I apply for the halal auto conversion program?
Apply online using the application form on this page. For Canadian applicants, a separate Canada application is available. You can also call IjaraCDC at 1-877-86-IJARA for guidance before applying.
What percentage of beneficial or economic ownership will I have immediately after converting my auto financing?
In a Murabaha (Installment Sale) structure, you hold the full beneficial and economic ownership of the vehicle from the moment of conversion. IjaraCDC does not retain any ownership stake. The conversion restructures the financial arrangement only; your ownership of the vehicle is not divided or shared.
Does IjaraCDC or the financing party retain any ownership after the conversion?
No. IjaraCDC does not retain an ownership percentage after conversion. However, the investor who funds the arrangement retains rights to the title in the event of default. This is standard in any financing structure and does not affect your day-to-day ownership of the vehicle.
How is my equity or ownership calculated under the Murabaha structure?
In a Murabaha (Installment Sale) conversion, your remaining obligation is calculated as the sum of all remaining payments, plus the one-time conversion fee and ongoing admin fees. The calculation follows the Installment Sale structure, not a percentage of the vehicle’s current market value.
Will my previous down payment and the payments I have already made count toward my ownership?
Yes. In a Murabaha structure, everything you have already paid, including your original down payment and the principal portion of your previous monthly payments, is recognized and credited toward the purchase. Murabaha gives you full benefit for every dollar you have already paid. Whether the current market value of the vehicle reflects that amount is a separate matter; under Murabaha, your paid position is your recognized ownership.