Is it permissible to seek financial compensation from the owner for terminating a lease contract before its expiration, if this serves the interest of both parties?
Leasing is one of the binding contracts. If the two parties agree to terminate it during the term, the lessor may compensate the lessee with a specific amount for relinquishing the usufruct of the remaining term. This is called "khulū compensation" (بدل خلو), and it is permissible in Sharia because it is a compensation for the lessee's relinquishment of their right. However, if the lease term expires and the contract is not renewed, khulū compensation is not permissible, because the owner has a greater right to their property.
Summarized from the full answer at Ftawy · reviewed Sep 2, 2026
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