Taking an interest based loan to pay one's debts
Fatwa No: 90514

Question

I purchased my new appt/home since 4 years on monthly installment payments to landlord and when ever I couldn't pay the monthly payment I use to loan from friends and family.
Today after 4 years I am done with all the house payment but two obstacles I have now to pay loans I took from family and friends and I have soon register this house in Shahar Aqari and pay for the government otherwise I might loose the house.
My question: Can I get bank loan with interest and pay above and during the next 4-5 years I settle the bank loan and its interest on monthly payment please advise and if your advise that the bank loan and the interest are not legalized to our religion the other solution is selling the house but with much money less than what I paid please advise.

Answer

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  `alayhi  wa  sallam ( may  Allaah exalt his mention ) is His slave and Messenger.

 

Taking interest-based loans is forbidden except at the time of dire necessity such as if a person faces a situation of death-threat due to hunger and cannot feed himself but with interest. Or that he is in a great trouble and cannot avoid it, like the one who does not have clothes to cover his body or does not have a house to live in even by paying rent, then, in such cases, one can use interest as mentioned in the verse: (which means) {He has explained in detail to you what He has forbidden you, excepting that to which you are compelled}[Quran 6:119].

Paying debts is not a valid excuse in Islam to deal with interest since Allaah orders a creditor to grant a respite to the indebted person who cannot pay his debt until he becomes capable for that. Furthermore, Allaah encourages the creditor to give up his rights as charity to the indebted person who can not pay back his loan. Allaah Says (what means): {And if someone is in hardship, then [let there be] postponement until [a time of] ease. But if you give [from your right as] charity, then it is better for you, if you only knew.}[Quran 2:180].

Therefore, if you cannot pay your loan to your relatives and friends, then they have to be patient and wait till you become able to repay their loans . However, taking a loan with Riba (interest and/or usury) is forbidden and owning a house is not an Islamicly valid excuse that justifies dealing with Riba.

Besides, you should know that borrowing with Riba is a very serious sin, it is waging war against Allaah as Allaah Says (what means): {O you who have believed, fear Allaah and give up what remains [due to you] of interest, if you should be believers. And if you do not, then be informed of a war [against you] from Allaah and His Messenger.}[Quran 2:278-279]

Furthermore, Jaabir  may  Allaah  have  mercy  upon  him narrated that the Prophet  sallallaahu  `alayhi  wa  sallam ( may  Allaah exalt his mention ) said: "Allaah has cursed the one who consumes Ribaa (usury or interest), the one who gives it to others, the one who writes it down and the one who witnesses it". He said: "All of them are equal in sin." [Muslim]

Hence, the matter is so serious and a sincere Muslim protects himself from being involved in such a grave major sin. So, you have to fear Allaah.

Also, we advise you to recite the supplications that are said to get free from debts. It is reported in a sound Hadeeth that 'A slave who had settled the terms of his freedom with his master in return of paying him an amount of money came to 'Ali  may  Allaah  be  pleased  with  him and said: "I am not able to discharge my installments according to the agreement, and I ask you to help me. Then, 'Ali  may  Allaah  be  pleased  with  him said to him: "Shall I teach you a supplication which the Prophet  sallallaahu  `alayhi  wa  sallam ( may  Allaah exalt his mention ) taught me whereby Allaah will facilitate the repayment of your debt even if it was as huge as a mountain? Then he said: Allaahumm Akfinee bihalaalika 'An haraamik, wa-aghninee bifadhlika 'Amman siwaak. (O Allaah, make what is lawful enough for me, as opposed to what is unlawful, and spare me by Your Grace the need of others).

Allaah Know best.

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