The Ruling on Installment Sales with an Increase in Price
Machine translationRead the Arabic original
Question:
What is the ruling for someone who wants to buy land but cannot pay the full amount, with approximately twenty percent of the price remaining? He knows that there is an entity that handles installments by purchasing the land in cash from the landowner, who is the seller, and then that entity takes the available amount from the buyer and installs the remainder with an increase of eight percent, on the condition that the land is pledged to that entity?
This is the first paragraph, Your Eminence.
Answer:
There is no harm in that. There is no harm in an entity buying land, a car, or something else in cash, and then selling it to another person on installments; because not everyone can buy in cash. There is nothing wrong with buying on installments. This is called (al-Wa'dah), and people call it (al-Wa'dah). If a person wants to buy a need, such as a car or land, and he cannot afford it, and he says to a person: buy it, and a person buys it from the owner in cash, and then sells it to Zayd or 'Amr on installments, and then the buyer sells it in cash to get married, or to pay off a debt, or something similar, there is no harm in that. And there are benefits for the Muslims in this. Some scholars prohibit it, but the correct view is that there is no harm in it.
So if a person buys a commodity on installments, and then sells it in cash to get married, or to build a residence for himself, or to pay off a debt on him, or something similar, there is no harm in that, and praise be to Allah. Even if the entity that sold it to him only bought it for his sake, buying the car in cash and then selling it to him on installments, or buying the land and then selling it to him on installments, all of that is permissible. And he sells it in cash and fulfills his need, whether marriage or otherwise. Yes.
The presenter: If the same entity, O Shaykh, that sold it to him buys it back, does that contradict the ruling?
Answer : It bought it in cash, and then sold it to him on installments, and he sells it, but he does not sell it until he takes possession. Once he takes possession, he sells it to the other person after taking possession, after moving the sold item from the place of sale; because the Messenger of Allah (peace and blessings be upon him)Sunan Abi Dawud 3499Hasan li ghairih (Al-Albani) meaning: the buyer moves it from the first seller's place to another place, another market, and then sells it to whoever he wishes. And the buyer likewise moves it and sells it in another place, acting in accordance with the Sunnah.
The presenter: May Allah reward you, O Shaykh.
What is the ruling for someone who wants to buy land but cannot pay the full amount, with approximately twenty percent of the price remaining? He knows that there is an entity that handles installments by purchasing the land in cash from the landowner, who is the seller, and then that entity takes the available amount from the buyer and installs the remainder with an increase of eight percent, on the condition that the land is pledged to that entity?
This is the first paragraph, Your Eminence.
Answer:
There is no harm in that. There is no harm in an entity buying land, a car, or something else in cash, and then selling it to another person on installments; because not everyone can buy in cash. There is nothing wrong with buying on installments. This is called (al-Wa'dah), and people call it (al-Wa'dah). If a person wants to buy a need, such as a car or land, and he cannot afford it, and he says to a person: buy it, and a person buys it from the owner in cash, and then sells it to Zayd or 'Amr on installments, and then the buyer sells it in cash to get married, or to pay off a debt, or something similar, there is no harm in that. And there are benefits for the Muslims in this. Some scholars prohibit it, but the correct view is that there is no harm in it.
So if a person buys a commodity on installments, and then sells it in cash to get married, or to build a residence for himself, or to pay off a debt on him, or something similar, there is no harm in that, and praise be to Allah. Even if the entity that sold it to him only bought it for his sake, buying the car in cash and then selling it to him on installments, or buying the land and then selling it to him on installments, all of that is permissible. And he sells it in cash and fulfills his need, whether marriage or otherwise. Yes.
The presenter: If the same entity, O Shaykh, that sold it to him buys it back, does that contradict the ruling?
Answer : It bought it in cash, and then sold it to him on installments, and he sells it, but he does not sell it until he takes possession. Once he takes possession, he sells it to the other person after taking possession, after moving the sold item from the place of sale; because the Messenger of Allah (peace and blessings be upon him)
forbade to sell the goods where they are bought until the tradesmen take them to their houses
نهى أن تباع السلع حيث تبتاع حتى يحوزها التجار إلى رحالهمThe presenter: May Allah reward you, O Shaykh.
Source
binbaz.org.sa
The Arabic text is copied verbatim from the original source, without any edits.