According to the Islamic ruling, a bank can not raise the agreed price of a good even if the debtor is unable to pay back his loan.
Yes, the bank can sue him, they can take him to court, they might even repossess the house, car, land, etc. but at the end of the day, the agreed price is the agreed price, no matter what.
Nothing can change that- and there can be no late fees, no surcharge, no hidden costs.
Everything has to be out in the open and agreed upon beforehand.
And if the homeowner is truly unable to pay… and asks for an extension, such as wanting to turn the 15 year mortgage he took into say 30 year mortgage, well then a whole new contract has to be drawn.
So in that case, the bank will first repossess the house, returning the homeowner all the money he has given them till that point.
