Is it permissible to sell a residential plot of land encumbered by a state-backed mortgage loan for a price higher than its value, on condition that the buyer repays the loan upon receiving it from the bank?
The aforementioned sale is invalid because the increase over the land's price is a loan stipulated upon the buyer, and a sale conditional on a loan is فاسد (void/corrupt) according to the majority of jurists from the Hanafis, Malikis, Shafi'is, and one of the two narrations from Ahmad. The sale is also invalidated due to the unknown price and its not being mentioned separately from the loan, as well as due to combining two transactions in one contract, which is Islamically prohibited.
Summarized from the full answer at Ftawy · reviewed Sep 2, 2026
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