High-interest debt likely only to be paid off by taking debt of lower interest
Fatwa No: 300979


Al Salaamu alaykum wa rahmat Allaah wa barakaatuhI am a young man who has a huge debt to pay, and who lives in the West. When I was still a child, I got into trouble with the authorities and I had to pay a huge fine. Of course I couldn't pay it, so now they want to add an interest rate of 8% every month so I have to pay more and more every time I do not pay the debt.But because I am a student, I am allowed to take a loan from the same country which can pay my debt. However, this loan has an interest rate of 4% every month.So now I have 3 options:1 - Ignore the debt, and let it grow and grow, thereby ruining my future as they will seize any material goods that I own when I live alone in the future.2 - Instead of paying the 8% interest rate, I will take a loan from the same state and repay my debt. Then I will "only" have to pay 4% interest rate, and if I can pay them back quickly, I won't have to pay the interest rate of 4% for very long.3 - Flee to a Muslim country so I don't have to pay their interest rates, and hope that they will not force me back to this country to repay my debt that they forced upon me...Please note that this debt and this interest rate have been imposed on me wrongfully and forcefully, and the debt will grow each month I do not pay it back.So what should I do, O my dear brothers, should I choose to pay back with a 4% interest loan , so I don't have to pay back the 8% interest debt? Or shall I ignore it altogether? This debt is from the country, and the optional student loan is also from the same country and the same treasury, so should I exchange the high-interest debt with the low-interest loan, or should I ignore them and let them ruin my future? Please advise me with that which will please my Lord the most. By Allaah, if I have no Halal options left I would rather have them execute me than do any haraam business with them.Jazaakum Allaah khair, walsalaamu alaykum.


All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad, sallallaahu ʻalayhi wa sallam, is His slave and Messenger.

To begin with, we ask Allaah Almighty to relieve your distress, satisfy your debt, bless you with guidance and set right your affairs.

As for your question, if you are required to pay 8% interest due to delay of payment on your debt and therefore the late payment charges would accumulate and you have no other permissible way to satisfy this debt and eliminate this evil except by engaging in a lesser evil by taking a low-interest loan (with 4% interest rate), then we hope that this is a valid excuse for doing so and that you would not bear sin for it. The Islamic law is based on the elimination of harm, the attainment of general good and the committing of the lesser of two evils, and there is no doubt that eliminating the worse of two evils is a legitimate general good which has juristic value.

Allaah Knows best.

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