Is it permissible to sign an apartment installment purchase contract that includes a penalty clause (late payment fine) in the event of failure to pay installments, knowing that the company stated that this clause is only a deterrent and is rarely activated except with procrastinators, and that it may not demand it from committed clients under certain circumstances?
Source: FtawySummary from Ftawy's records · added here Sep 2, 2026
The mere stipulation of a penalty for late payment of installments is sufficient to prohibit entering into the contract, as it is a usurious and forbidden condition. The fact that the company only applies this condition to those proven to be deceptive does not mean it is suspended. However, for one who is in dire need or has an urgent necessity, it is permissible for them. Similarly, it is permissible for one who imitates those who deem this condition permissible.
Summary from Ftawy's records · added here
Reviewed by El Fatwa's sharia committee.
Read the full answer on Ftawyhttps://ftawy.com/en/questions/181111
Where this answer came from
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- Ftawy
- Original fatwa ID
- 181111
- 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