What is tawarruq and what is its ruling?
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The questioner : In the name of Allah.
Peace be upon you and Allah's mercy, Your Eminence.
The Shaykh : And upon you be peace and the mercy of Allah.
The questioner : This question is from the Islamic jurisprudence subject for the third grade.
The Shaykh : What?
The questioner : This question is from the Islamic jurisprudence subject for the third grade, intermediate level for girls, regarding tawarruq: What is tawarruq, and what is its ruling?
The Shaykh : Tawarruq?
The questioner : Yes.
The Shaykh : Tawarruq is when a person needs money to buy a car, but cannot find anyone to lend it to him. So he goes to a person and buys a commodity from him for a deferred price that is higher than its spot price. Then he takes the commodity and sells it, and uses the proceeds to buy the car he wants. Likewise, if a person needs land to build a residence on, but has no money and cannot find anyone to lend it to him, and the landowner refuses to sell it for a deferred price, he goes to another person and says: "Sell me cars for a deferred price that is higher than the spot price." Then he takes the cars, sells them, and uses the proceeds to buy this land. This is tawarruq, meaning: he needs money, so he buys what is worth a thousand for a thousand and one hundred on credit, in order to sell it and get his money to buy what he needs. This is tawarruq.
The scholars (may Allah have mercy on them) differ on this: some permitted it, some said it is disliked, and some said it is forbidden. Among those who said it is forbidden and emphasized its prohibition is Shaykh al-Islam Ibn Taymiyyah (may Allah have mercy on him). Yes.
Peace be upon you and Allah's mercy, Your Eminence.
The Shaykh : And upon you be peace and the mercy of Allah.
The questioner : This question is from the Islamic jurisprudence subject for the third grade.
The Shaykh : What?
The questioner : This question is from the Islamic jurisprudence subject for the third grade, intermediate level for girls, regarding tawarruq: What is tawarruq, and what is its ruling?
The Shaykh : Tawarruq?
The questioner : Yes.
The Shaykh : Tawarruq is when a person needs money to buy a car, but cannot find anyone to lend it to him. So he goes to a person and buys a commodity from him for a deferred price that is higher than its spot price. Then he takes the commodity and sells it, and uses the proceeds to buy the car he wants. Likewise, if a person needs land to build a residence on, but has no money and cannot find anyone to lend it to him, and the landowner refuses to sell it for a deferred price, he goes to another person and says: "Sell me cars for a deferred price that is higher than the spot price." Then he takes the cars, sells them, and uses the proceeds to buy this land. This is tawarruq, meaning: he needs money, so he buys what is worth a thousand for a thousand and one hundred on credit, in order to sell it and get his money to buy what he needs. This is tawarruq.
The scholars (may Allah have mercy on them) differ on this: some permitted it, some said it is disliked, and some said it is forbidden. Among those who said it is forbidden and emphasized its prohibition is Shaykh al-Islam Ibn Taymiyyah (may Allah have mercy on him). Yes.