Mu' meneen Brothers and Sisters,

As Salaam Aleikum wa Rahmatullahi wa Barakatuh. (May Allah's Peace, Mercy and Blessings be upon all of you)

 

One of our brothers/sisters has asked this question:

Dear Brother

As salamu Alaikum

 

I am planning to buy a new car, but I don`t have money to pay in lumsum, can I go for installment through bank,some Islamic Finance Banks are also there but they charge more than what normal bank charge as interest. we have one mulavi saheb I check with him, he said If both the parties are not involved in profit and loss then everything is haram.

 

Please help us to over come this issue.

 

(There may be some grammatical and spelling errors in the above statement. The forum does not change anything from questions, comments and statements received from our readers for circulation in confidentiality.)

 

Answer:

 

Car loan

In the name of Allah, We praise Him, seek His help and ask for His forgiveness. Whoever Allah guides none can misguide, and whoever He allows to fall astray, none can guide them aright. We bear witness that there is none worthy of worship but Allah Alone, and we bear witness that Muhammad (saws) is His slave-servant and the seal of His Messengers.

 

Allah says in the Holy Quran Chapter 2 Surah Baqarah verse 274-276:

But those who devour ‘riba’ become like the one whom Shaitaan has bewitched and maddened by his touch.   They have been condemned to this condition because they say,  “Trade is just like ‘riba”,  whereas Allah has made trade halaal and ‘riba’ haraam.   Henceforth,  if one abstains from taking ‘riba’ after receiving this admonition from his Lord,  no legal action shall be taken against him regarding the ‘riba’ he had devoured before:  his case shall ultimately go to Allah.   But if one repeats the same crime even after this, he shall go to Hell,  where he shall abide for ever!   Allah deprives ‘riba’ of all blessing and develops charity,  and Allah does not like an ungrateful,  sinful person.

 

Allah says further in the Holy Quran Chapter 2 Surah Baqarah verse 278:

O Believers!,  fear Allah and give up that ‘riba’ which is still due to you,  if you are true believers.   But if you do not do so,  then you are warned of the declaration of war against you by Allah and His Messenger!

 

Allah says in the Holy Quran Chapter 4 Surah Nisa verse 161:

That they took ‘riba’,  although they were forbidden.  And that they devoured men’s substance wrongfully.   We have prepared for those among them who reject faith a grievous punishment (of Hell Fire)!

 

Al-Tirmidhi Hadith 2827        Narrated by Abdullah ibn Mas'ud

Allah's Messenger (saws) said, "Even though usury be much, it leads in the end to penury."

 

Al-Tirmidhi Hadith 2829        Narrated by Ali ibn AbuTalib

Ali said he heard Allah's Messenger (saws) invoke the curse of Allah on those who took usury, those who paid it, those who recorded it, and those who refused to give sadaqah.

 

Dear and beloved brother in Islam, without an iota of a doubt, the very concept and indulgence in any type or sort of ‘riba’ or interest-based transaction is declared absolutely unlawful by Allah and His Messenger (saws).  Thus buying a car through a loan from an interest-based conventional bank is not even an option for one who sincerely believes in Allah and the Last Day.

 

There are several Shariah-compliant Islamic Financial Institutions and  Banks which accommodate the buying of a car through a interest-free Shariah compliant loan.  Even if these Shariah-compliant Islamic Banks were to charge twice as much profit for a loan than that of a interest-based conventional bank, the interest-based loan from a conventional bank would still be and remain absolutely unlawful for one who sincerely fears Allah and the Last Day!

 

Your Question: we have one mulavi saheb I check with him, he said If both the parties are not involved in profit and loss then everything is haram

Dear and beloved brother in Islam, all the good Islamic Banks have a competent board of Shariah Advisors, who are qualified and experts in the field of Islamic finance, and they would make sure that every transaction done by the Islamic bank is based on principles which do not violate any of the Shariah Laws. 

 

Whatever written of Truth and benefit is only due to Allah’s Assistance and Guidance, and whatever of error is of me alone.  Allah Alone Knows Best and He is the Only Source of Strength.

 

Your brother and well wisher in Islam,

 

 

Burhan