A Forbidden Form in Installment Sales
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Question:
Your Eminence, what are some of the forbidden methods in installment sales?
Answer:
If he sells it to the person from whom he bought it, then if he buys something on deferred payment in installments, and then sells it for cash to the person from whom he bought it, this is called 'inah; so it is not permissible. But if he sells it to someone else, there is nothing wrong with it. If he buys a car on installment, and then sells it for cash to another person, Zayd or 'Amr, to get married, or to pay off a debt, or to renovate a residence; there is nothing wrong with that.
As for buying a car or something else on installment, and then selling it for cash to its owner, this is called 'inah, because it is a ruse to obtain cash money with more money on deferred payment.
The presenter: Thank you, Your Eminence, and may Allah bless you, your knowledge, and benefit the Muslims through you.
Your Eminence, what are some of the forbidden methods in installment sales?
Answer:
If he sells it to the person from whom he bought it, then if he buys something on deferred payment in installments, and then sells it for cash to the person from whom he bought it, this is called 'inah; so it is not permissible. But if he sells it to someone else, there is nothing wrong with it. If he buys a car on installment, and then sells it for cash to another person, Zayd or 'Amr, to get married, or to pay off a debt, or to renovate a residence; there is nothing wrong with that.
As for buying a car or something else on installment, and then selling it for cash to its owner, this is called 'inah, because it is a ruse to obtain cash money with more money on deferred payment.
The presenter: Thank you, Your Eminence, and may Allah bless you, your knowledge, and benefit the Muslims through you.
Source
binbaz.org.sa
The Arabic text is copied verbatim from the original source, without any edits.