What is the ruling on selling a car on installment before purchasing it?
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The questioner : May Allah reward you. A questioner says: I am a man who works in car installments, and a man came to me asking me to sell him a car on installment, but I do not own a car. Is it permissible for me to buy it after knowing his needs?
The Shaykh : Yes, yes.
The questioner : I am a man who works in car installments, and a man came to me asking me to sell him a car on installment, but I do not own a car. Is it permissible for me to buy it after knowing his needs and sell it to him on installment? What is the permissible profit in installments? And is it permissible for people to pay zakah in installments, or not? Please give us a ruling, may Allah reward you with good.
The Shaykh : These are three questions that I will combine into one. The first question is: Is it permissible for me, if a person comes to me and asks for a car that I do not have, to buy him a car from the showroom and sell it to him on installments? The answer is: It is not permissible unless you sell it to him for the same price, meaning you buy it from the showroom for fifty and sell it to him for fifty; there is nothing wrong with that. Because the most that is in it is that you lent him the amount without interest; this is permissible. This is one case. The second case is that you buy the car for his sake and sell it to him on installments for an added amount, such as buying it for fifty thousand and selling it to him on installments for sixty thousand. This is forbidden. Why? Because its reality is that you lent him the value of the car with interest, and this is the very essence of riba (usury or interest). But in it there is a deception of whom? Of the Lord of the worlds, who[Ghafir 40:19]
The Shaykh : Yes, yes.
The questioner : I am a man who works in car installments, and a man came to me asking me to sell him a car on installment, but I do not own a car. Is it permissible for me to buy it after knowing his needs and sell it to him on installment? What is the permissible profit in installments? And is it permissible for people to pay zakah in installments, or not? Please give us a ruling, may Allah reward you with good.
The Shaykh : These are three questions that I will combine into one. The first question is: Is it permissible for me, if a person comes to me and asks for a car that I do not have, to buy him a car from the showroom and sell it to him on installments? The answer is: It is not permissible unless you sell it to him for the same price, meaning you buy it from the showroom for fifty and sell it to him for fifty; there is nothing wrong with that. Because the most that is in it is that you lent him the amount without interest; this is permissible. This is one case. The second case is that you buy the car for his sake and sell it to him on installments for an added amount, such as buying it for fifty thousand and selling it to him on installments for sixty thousand. This is forbidden. Why? Because its reality is that you lent him the value of the car with interest, and this is the very essence of riba (usury or interest). But in it there is a deception of whom? Of the Lord of the worlds, who
He knows that which deceives the eyes and what the breasts conceal.
يَعْلَمُ خَائِنَةَ الْأَعْيُنِ وَمَا تُخْفِي الصُّدُورُ
Source
دروس وفتاوى المسجد الحرام لعام 1419هـ - 24 — binothaimeen.net (59:52)
The Arabic text is a machine transcription of the audio recording.