What is the ruling on the seller's conditions in a land installment sale contract, which stipulate the termination of the contract upon delay in paying two installments, and the deduction of 30% as a penalty clause if the buyer terminates the contract? And what are the correct conditions that guarantee the seller's right if the buyer is unable to pay or wishes to withdraw from the contract?
Source: FtawySummary from Ftawy's records · added here Sep 2, 2026
First: It is permissible to stipulate the annulment of a sale if the buyer fails to pay two consecutive installments, whether he is in straitened circumstances or procrastinating.
Second: It is permissible to stipulate that the buyer pays 30% of the price if the contract is annulled without a valid Shar'i (Islamic legal) justification, based on the Prophet's (peace be upon him) saying: "Muslims are bound by their conditions."
Third: Upon annulment, the seller must refund what the buyer has paid. It is permissible to stipulate that the amount be refunded in installments if the buyer accepts that.
Summary from Ftawy's records · added here
Reviewed by El Fatwa's sharia committee.
Read the full answer on Ftawyhttps://ftawy.com/en/questions/16474
Where this answer came from
- Source platform
- Ftawy
- Original fatwa ID
- 16474
- Added here
- . This is when the answer was added to El Fatwa, not the fatwa's date.
- Text
- Summary from Ftawy's records, reviewed by El Fatwa's sharia committee.
- Read the full ruling
- Read the full answer on Ftawy