Borrowing from the Real Estate Development Fund
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Fatwa No. ( 13039 )
Q: I have an account number with the Real Estate Bank, and I will obtain a loan from the state through this bank. However, it will take a long time before I receive this loan. Since the state will grant me a waiver of 20% if I pay it off within the specified time, and 30% if I pay it in a lump sum after construction, and now, as I have heard, the National Bank will provide the required loan of (300,000 riyals), but the bank will pay the state and benefit from this state waiver. Is it permissible for me to take this amount (300,000 riyals) from the National Bank and repay (300,000 riyals), and when my turn comes for the loan, the National Bank takes it from the Real Estate Bank, and I repay the National Bank (12,000 riyals) each year, and the National Bank repays the Real Estate Bank (9,600 riyals), and it becomes
the beneficiary of this loan and the waiver. Please inform us, may Allah reward you.
A: It is not permissible for you to borrow three hundred from the bank on the condition that you repay three hundred plus what the government waives; because there is an increase in the repayment that is stipulated, and this is riba (usury or interest). And success is from Allah, and may Allah send prayers and blessings upon our Prophet Muhammad, his family, and his Companions.
Q: I have an account number with the Real Estate Bank, and I will obtain a loan from the state through this bank. However, it will take a long time before I receive this loan. Since the state will grant me a waiver of 20% if I pay it off within the specified time, and 30% if I pay it in a lump sum after construction, and now, as I have heard, the National Bank will provide the required loan of (300,000 riyals), but the bank will pay the state and benefit from this state waiver. Is it permissible for me to take this amount (300,000 riyals) from the National Bank and repay (300,000 riyals), and when my turn comes for the loan, the National Bank takes it from the Real Estate Bank, and I repay the National Bank (12,000 riyals) each year, and the National Bank repays the Real Estate Bank (9,600 riyals), and it becomes
the beneficiary of this loan and the waiver. Please inform us, may Allah reward you.
A: It is not permissible for you to borrow three hundred from the bank on the condition that you repay three hundred plus what the government waives; because there is an increase in the repayment that is stipulated, and this is riba (usury or interest). And success is from Allah, and may Allah send prayers and blessings upon our Prophet Muhammad, his family, and his Companions.
Source
www.alifta.gov.sa
The Arabic text is copied verbatim from the original source, without any edits.