What is the ruling on purchasing land through Al-Rajhi Bank?
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The questioner : In the name of Allah, the Most Gracious, the Most Merciful.
Peace be upon you, and Allah's mercy and blessings.
The Shaykh : And upon you be peace and Allah's mercy and blessings.
The questioner : His EminenceThe Shaykh : What is the ruling on purchasing land through Al-Rajhi Bank, and if it is not permissible, what is the aspect of doubt in that?
The Shaykh : How is this purchase carried out?
The questioner : By Allah, I have no knowledge of the details of their contracts. I do not know if anyone, for example, has received the news?
The Shaykh : Does any of you know? What is the method?
The questioner : The method appears to be that Al-Rajhi buys the property and puts it in its treasury, and then you have the option to buy it or refuse, meaning you are given the choice.
The Shaykh : If the lands are with the seller and a person comes to buy land from him for cash, saying, "Here is my money," and the seller says, "I sold it to you," and then another person comes to buy similar land but does not have money, and the landowner says to him, "I will sell you this land for twelve thousand, and I sold a similar one for ten thousand, but I added two thousand because it will be deferred and paid in installments," then there is no harm in that, because the land is with him. However, if he says, "I want to buy land and I do not have money, so I will go to the merchant and say: Buy the land for me, then sell it to me in installments for more than what you bought it for," then this is forbidden and not permissible, because this is a stratagem to circumvent riba (usury or interest), because this merchant would not have bought the land if you had not come to him, so it is as if he lent you its value with an increase, and a loan with an increase is riba (usury or interest) "Every loan that brings a benefit is riba", and this loan brought a benefit to the lender, which is the increase in the price, so this is forbidden and is among the stratagems to circumvent the prohibitions of Allah the Exalted and Majestic.
As for the merchant's statement: "If the one who bought the land were here, I would have accepted the land," this is a word, as they say, of the type of scattering dust in the eyes, because it is known that the one who has needed the land and has come to seek your help to buy it for him and then sell it to him is known not to return, so he needs it. And if it happens that one out of ten thousand returns, this is not a standard. Moreover, I have heard that the one who returns after the merchant buys it is written on the blacklist so that the merchant does not deal with him thereafter, and this is like a threat to him if he returns, so he will accept in any case.
So now the issue has a detail: if the commodity is with the seller from the beginning and before you come to him, there is no harm in him selling it to you for more than its current value with an installment price. And if it was not with him, but he bought it for your sake and then sold it to you with an increase, then this is not permissible.
Peace be upon you, and Allah's mercy and blessings.
The Shaykh : And upon you be peace and Allah's mercy and blessings.
The questioner : His EminenceThe Shaykh : What is the ruling on purchasing land through Al-Rajhi Bank, and if it is not permissible, what is the aspect of doubt in that?
The Shaykh : How is this purchase carried out?
The questioner : By Allah, I have no knowledge of the details of their contracts. I do not know if anyone, for example, has received the news?
The Shaykh : Does any of you know? What is the method?
The questioner : The method appears to be that Al-Rajhi buys the property and puts it in its treasury, and then you have the option to buy it or refuse, meaning you are given the choice.
The Shaykh : If the lands are with the seller and a person comes to buy land from him for cash, saying, "Here is my money," and the seller says, "I sold it to you," and then another person comes to buy similar land but does not have money, and the landowner says to him, "I will sell you this land for twelve thousand, and I sold a similar one for ten thousand, but I added two thousand because it will be deferred and paid in installments," then there is no harm in that, because the land is with him. However, if he says, "I want to buy land and I do not have money, so I will go to the merchant and say: Buy the land for me, then sell it to me in installments for more than what you bought it for," then this is forbidden and not permissible, because this is a stratagem to circumvent riba (usury or interest), because this merchant would not have bought the land if you had not come to him, so it is as if he lent you its value with an increase, and a loan with an increase is riba (usury or interest) "Every loan that brings a benefit is riba", and this loan brought a benefit to the lender, which is the increase in the price, so this is forbidden and is among the stratagems to circumvent the prohibitions of Allah the Exalted and Majestic.
As for the merchant's statement: "If the one who bought the land were here, I would have accepted the land," this is a word, as they say, of the type of scattering dust in the eyes, because it is known that the one who has needed the land and has come to seek your help to buy it for him and then sell it to him is known not to return, so he needs it. And if it happens that one out of ten thousand returns, this is not a standard. Moreover, I have heard that the one who returns after the merchant buys it is written on the blacklist so that the merchant does not deal with him thereafter, and this is like a threat to him if he returns, so he will accept in any case.
So now the issue has a detail: if the commodity is with the seller from the beginning and before you come to him, there is no harm in him selling it to you for more than its current value with an installment price. And if it was not with him, but he bought it for your sake and then sold it to you with an increase, then this is not permissible.