Some companies sell cars with an initial installment and a deferred one, with fees in between called service fees. What is the ruling on this?
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The questioner : Your Eminence, there is a method that has now become widespread regarding sales.
The Shaykh : What?
The questioner : In sales transactions, one pays half the value of the car, for example, and then pays the value.
The Shaykh : I mean, is it deferred payment ending in ownership?The questioner : No.
The Shaykh : Other than that?
The questioner : Yes, it is similar to that. That is, one pays half the value of the car, and after two years pays the remaining half, but in each month pays a specific amount, or approximately a small sum, called administrative services or something like that.
The Shaykh : All of this is actually a ruse to avoid something that is not necessary. Instead of saying: "I sold you this car for twenty thousand cash and thirty thousand after one year, yes, and twenty thousand after one year and ten thousand, one thousand riyals each month," we say: "It is like this, and there is nothing in it." But we add to the price something that has no reality, and there is no need for it, because there are no services. The services ended with the first document, and in the end, this document is torn up. Therefore, we say to these people: Do not make it in this manner. Say: "I sold it to you for fifty thousand: twenty thousand cash, twenty thousand after one year, and ten thousand distributed over eleven months," and it is valid.
The Shaykh : What?
The questioner : In sales transactions, one pays half the value of the car, for example, and then pays the value.
The Shaykh : I mean, is it deferred payment ending in ownership?The questioner : No.
The Shaykh : Other than that?
The questioner : Yes, it is similar to that. That is, one pays half the value of the car, and after two years pays the remaining half, but in each month pays a specific amount, or approximately a small sum, called administrative services or something like that.
The Shaykh : All of this is actually a ruse to avoid something that is not necessary. Instead of saying: "I sold you this car for twenty thousand cash and thirty thousand after one year, yes, and twenty thousand after one year and ten thousand, one thousand riyals each month," we say: "It is like this, and there is nothing in it." But we add to the price something that has no reality, and there is no need for it, because there are no services. The services ended with the first document, and in the end, this document is torn up. Therefore, we say to these people: Do not make it in this manner. Say: "I sold it to you for fifty thousand: twenty thousand cash, twenty thousand after one year, and ten thousand distributed over eleven months," and it is valid.