What is the ruling on installment sales, and if the interest in them is about 25 percent higher than the cash sale?

Question:
What is the ruling on installment sales, and if the interest in them is about twenty-five percent higher than the cash sale? What is the ruling in that case, knowing that both parties are aware of this? May Allah reward you with good.

Answer:
There is nothing wrong with installment sales, whether deferred or in multiple installments; all of this is permissible. And Allah the Exalted said: The default in transactions is permissibility, and because the Prophet (peace and blessings be upon him) bought and sold on credit. He (peace and blessings be upon him) passed away while his armor was pledged with a Jew for food he had bought for his family (peace and blessings be upon him). He used to borrow from the camels of zakah; the Prophet (peace and blessings be upon him) would borrow from the camels of zakah when a need arose for a military expedition. All of this indicates the permissibility of deferred sales. Salam (forward sale) is a type of deferred sale, because it involves advancing the price and advancing the commodity. Allah the Exalted said: This includes the debt of salam, and it also includes other debts, including the price of a sold item if it is deferred. The increase in the deferred price is permissible, because it is known that a deferred sale differs from a cash sale, and people do not sell on credit unless they have an expectation that encourages them to defer. However, the seller should not exploit the buyer's need and increase the price by an exorbitant amount; rather, he should increase it by an acceptable amount. If the buyer is in need and distressed, the Muslim should consider the rights of his Muslim brother and increase the price by a non-exaggerated amount.