What is the ruling on purchasing furniture and cars on installment?
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The questioner : This questioner, Abdullah, from Riyadh, asks: What is the ruling on purchasing furniture and cars on installment?
The Shaykh : Purchasing cars and furniture on installment, if the items are in the possession of the seller and the buyer intends to buy those specific items, there is nothing wrong with it, as it falls under the general meaning of the statement of Allah the Exalted:[Al-Baqarah 2:275] and His statement: [Al-Baqarah 2:282].
As for when the items are not in the possession of the seller, but the buyer, i.e., the requester, specifies them, and then the seller goes and buys them and then sells them to him, this is not permissible, because this is a stratagem to circumvent riba (usury or interest). This transaction means that he lent him the price with riba (usury or interest) and an increase of riba (usury or interest), because the merchant bought it, for example, for one hundred and sold it to this person for one hundred and twenty. And if it is in the possession of the seller and in his ownership, and the buyer does not want it specifically, but rather wants to buy it and benefit from its price, this is the issue of tawarruq (a commodity sale used to obtain cash), and there is scholarly disagreement regarding it. Some scholars have permitted it, and some have prohibited it. Among those who prohibited it is Shaykh al-Islam Ibn Taymiyyah (may Allah have mercy on him). The precaution is for a person not to deal in it, especially if his dealing is for the sake of trade, because a person may profit and may not profit, even though he may have lost due to the increase in the price imposed on him for the deferral. Yes.
The questioner : May Allah bless you.
The Shaykh : Purchasing cars and furniture on installment, if the items are in the possession of the seller and the buyer intends to buy those specific items, there is nothing wrong with it, as it falls under the general meaning of the statement of Allah the Exalted:
But Allah has permitted trade
وَأَحَلَّ اللَّهُ البَيعَO you who have believed, when you contract a debt for a specified term, write it down.
يا أَيُّهَا الَّذينَ ءامَنوا إِذا تَدايَنتُم بِدَينٍ إِلى أَجَلٍ مُسَمًّى فَاكتُبوهُAs for when the items are not in the possession of the seller, but the buyer, i.e., the requester, specifies them, and then the seller goes and buys them and then sells them to him, this is not permissible, because this is a stratagem to circumvent riba (usury or interest). This transaction means that he lent him the price with riba (usury or interest) and an increase of riba (usury or interest), because the merchant bought it, for example, for one hundred and sold it to this person for one hundred and twenty. And if it is in the possession of the seller and in his ownership, and the buyer does not want it specifically, but rather wants to buy it and benefit from its price, this is the issue of tawarruq (a commodity sale used to obtain cash), and there is scholarly disagreement regarding it. Some scholars have permitted it, and some have prohibited it. Among those who prohibited it is Shaykh al-Islam Ibn Taymiyyah (may Allah have mercy on him). The precaution is for a person not to deal in it, especially if his dealing is for the sake of trade, because a person may profit and may not profit, even though he may have lost due to the increase in the price imposed on him for the deferral. Yes.
The questioner : May Allah bless you.