What is the ruling on one who buys a car in order to sell it for a profit at a deferred date?
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The questioner : O esteemedThe Shaykh : The issue regarding car financing is when a person, for example, finances cars. He goes, and the person who wants a car specifies its type. The person who wants to finance it, meaning if he buys the car, and then the person who will buy it, meaning for example, uses it or moves it from its place, or looks at it, and then he buys it and sells it to the person who wants it for a price higher than its cost in the agency. Is this transaction permissible?
The Shaykh : No, this is not permissible. The scenario of this issue is that a person needs a car and does not have money, so he goes to a merchant and says, "I want such-and-such a car. Buy it for me, and I will take it from you at a deferred date for a profit." This is forbidden, because it is a stratagem. The merchant only bought it for the man who came asking for it, who did not have it from the start. So if he bought it in order to sell it to him at a deferred date with a profit, this is the very essence of riba, but instead of being explicit, it became deception and a stratagem. Instead of saying, "O one in need of a car, this is fifty thousand riyals. Buy the car with it, and these fifty thousand are on you as sixty thousand for one year," he says, "I will buy the car and then sell it to you." The merchant bought it for this person in need, not out of compassion for him, and for this reason he sells it for a profit. There is no doubt that this is more wicked than if he had said, "Take fifty thousand riyals, and it is on you as sixty thousand riyals." It is more wicked because it is based on deception, and the harm of riba is realized in it. It is not possible for the great riba, for which Allah has decreed a punishment that He has not decreed for any sin less than disbelief, to be lawful by such a method. Because everyone can say this, just as some have said, "I will buy, for example, gold weighing one hundred grams with gold weighing eighty grams, and I intend the twenty grams as a gift and charity." Is this reasonable? Answer, people! It is not reasonable, because if we said this was permissible, everyone could engage in riba and not care. Do not be deceived by the fatwa of one who said it is permissible in the first issue, for if he examined the issue with true examination, he would find that it is a very clear stratagem against riba, and that this great, exalted Shari'ah would not descend to permit this transaction while riba is forbidden. Yes.
The questioner : Okay, O honorable Shaykh, if the car owner argues that he does not force the buyer?
The Shaykh : The phrase "does not force," my brother, is all idle talk with no benefit. Can the one who came asking for the car, who is the one choosing the car, make it easy? No, he cannot. And the statement, "If he makes it easy, he did not force him," is all talk by which a believer can never be deceived. For this reason, it is said to me that if this man makes it easy, they will take him to... and write his name on the blacklist, so they do not deal with him afterwards, even though he does not make it easy, and there are conditions written on him that do not allow him to make it easy. The important thing is that it is obligatory for us, before we perform actions, to look at whom we are dealing with. Are we not dealing with the Lord of the Worlds? We must know that He, Glorified and Exalted is He, is All-Knowing of the secrets, and that His Prophet Muhammad (peace and blessings be upon him) said: And look at the Jews when the fats were forbidden to them, what did they do? They melted the fat and made it into oil, then they sold it and ate its price. They did not eat the fat, nor did they eat the oil. And yet the Prophet (peace and blessings be upon him) said: And the Messenger of Allah (peace and blessings be upon him) spoke the truth when he said: Sahih al-Bukhari 7320 With these transactions and their like, we have committed what the Jews committed. And the Prophet (peace and blessings be upon him) said: Yes.
The Shaykh : No, this is not permissible. The scenario of this issue is that a person needs a car and does not have money, so he goes to a merchant and says, "I want such-and-such a car. Buy it for me, and I will take it from you at a deferred date for a profit." This is forbidden, because it is a stratagem. The merchant only bought it for the man who came asking for it, who did not have it from the start. So if he bought it in order to sell it to him at a deferred date with a profit, this is the very essence of riba, but instead of being explicit, it became deception and a stratagem. Instead of saying, "O one in need of a car, this is fifty thousand riyals. Buy the car with it, and these fifty thousand are on you as sixty thousand for one year," he says, "I will buy the car and then sell it to you." The merchant bought it for this person in need, not out of compassion for him, and for this reason he sells it for a profit. There is no doubt that this is more wicked than if he had said, "Take fifty thousand riyals, and it is on you as sixty thousand riyals." It is more wicked because it is based on deception, and the harm of riba is realized in it. It is not possible for the great riba, for which Allah has decreed a punishment that He has not decreed for any sin less than disbelief, to be lawful by such a method. Because everyone can say this, just as some have said, "I will buy, for example, gold weighing one hundred grams with gold weighing eighty grams, and I intend the twenty grams as a gift and charity." Is this reasonable? Answer, people! It is not reasonable, because if we said this was permissible, everyone could engage in riba and not care. Do not be deceived by the fatwa of one who said it is permissible in the first issue, for if he examined the issue with true examination, he would find that it is a very clear stratagem against riba, and that this great, exalted Shari'ah would not descend to permit this transaction while riba is forbidden. Yes.
The questioner : Okay, O honorable Shaykh, if the car owner argues that he does not force the buyer?
The Shaykh : The phrase "does not force," my brother, is all idle talk with no benefit. Can the one who came asking for the car, who is the one choosing the car, make it easy? No, he cannot. And the statement, "If he makes it easy, he did not force him," is all talk by which a believer can never be deceived. For this reason, it is said to me that if this man makes it easy, they will take him to... and write his name on the blacklist, so they do not deal with him afterwards, even though he does not make it easy, and there are conditions written on him that do not allow him to make it easy. The important thing is that it is obligatory for us, before we perform actions, to look at whom we are dealing with. Are we not dealing with the Lord of the Worlds? We must know that He, Glorified and Exalted is He, is All-Knowing of the secrets, and that His Prophet Muhammad (peace and blessings be upon him) said: