The Ruling on Purchasing Housing Through Companies

The questioner:
He says: Honorable Shaykh, I seek Allah's forgiveness. What is the ruling on what some companies do? They say to the one who wants to buy a residence: "Go, and when you find a suitable residence, inform us. We will buy the residence and register it in our name. If you want to buy it from us, we will sell it to you. If you change your mind, we will not hold you to it." What is the ruling on this?

The Shaykh:
Their statement, "If you change your mind, we will not hold you to it," and all this talk is a ruse. It is not permissible. If the houses or lands are in their possession, or if the cars are in their possession at the time of the contract, and they contract with you for something they own at the time of the contract, then there is no harm. But these ruses and this talk are all ruses; they are not correct. This is not permissible. This is what people are falling into now, with the banks.
Some companies do this, but it is not permissible because it revolves entirely around selling what one does not own, and also around riba (usury or interest). That is, they pay the price for you in the form of a loan and take an increase on it. This is not permissible. Transactions must be clear and explicit, without twists or ambiguity. The one who wants to sell or buy real estate or cars must have the goods in his possession and ownership. When someone comes to buy, he sells to him. This is the safest and clearest path. As for twists, ruses, and talk that is not correct—they say this talk, but it is not correct. The contract is not completed, and they do not bind the customer. If he wants to back out, they force him, or they take a sum of money from him in exchange for his withdrawal. This is not permissible. Yes, yes.

The questioner:
The one who has fallen into this company must redo the sale and redo the contract.

The Shaykh:
They obey him? He goes to the court. If they accept, they take it back from them. If they do not accept, he goes to the court. Yes.

Another questioner:
Yes.

The Shaykh:
This is selling what is not considered selling what one does not own. It is also considered riba (usury or interest) because it means they lent you the price of the house you bought and take an increase on it. They lent it to you and paid it to the seller, and then they recover it from you with the increase. This is riba. Yes.