Ijarah
Ijarah is a contract to use something, or someone's labor, for a set period in exchange for payment.
What it means for me: Ijarah covers renting an apartment and hiring a worker under the same idea. You are paying for the use of something, not buying it outright. The contract ends when its term ends or the agreed use is completed.
Example: A family rents an apartment for one year at a fixed monthly rent. That agreement is an ijarah: they pay for the use of the home, and ownership never changes hands.
Do not confuse with: *Bay*, a sale. Ijarah transfers only the right to use something for a time; a sale transfers ownership of the thing itself, permanently.
If scholars differ: Contemporary scholars differ on how a lease-to-own contract should be structured. Most require it to remain two separate contracts: a lease and a later transfer of ownership. One disguised sale is not accepted.
Related terms
See the term in context
What is the ruling on obtaining a real estate loan in the following manner: the bank buys the land from the client at the market price of 500,000 Saudi Riyals, then the bank sells it to the client through an Ijarah contract (lease with promise to own) at the same price of the land plus profits at a rate of 2.5% over ten years?
The aforementioned contract, which involves selling land to a party affiliated with the bank, followed by the bank selling it to you through an Ijarah (lease) contract with a promise to transfer ownership, with a 2.5%…
Is the scenario of "an employer who owns a factory but not its capital, and has two individuals who deposit their money with him for investment, and they receive their share of the profit based on the capital, while the employer only receives a monthly salary" considered a Mudarabah (profit-sharing partnership) or an Ijarah (lease/hire)? If it is valid as an Ijarah, is it permissible for the employee to invest his own money as part of the capital and receive profit from it? And is it permissible for a third party to join this arrangement?
There is no impediment for the factory owner to rent out himself and his factory to capital owners for a known monthly wage, provided that the rulings of ijarah (leasing/hiring) are applied, which include knowledge of…
What is meant by and what is the legitimate ruling on the clauses of Bank AlJazira's Ijarah contract related to: (cooperative insurance for cases of death and disability, and the assignment of the right to compensation for the benefit of the debt), and (cooperative insurance for fire accidents and risks of housing damage), and (the tenant bearing all operational maintenance costs and rental repairs resulting from the use of the dwelling)?
The intent of the phrases refers to the party imposing the conditions. The first: The bank's condition for the debtor to insure his debt as a guarantee of its right in case of the debtor's inability to pay. There is no…
Questions that use it
Is the sewing profession, in which the customer contributes part of the raw material (the fabric) and the seamstress completes the rest of the materials (accessories), considered a manufacturing contract (Istisna') or a lease contract (Ijarah), and how is the sewing price determined in this case? What is the ruling on the seamstress dealing with an embroiderer to complete the work, and is this considered a parallel manufacturing contract (Istisna' Muwazi), and what is the ruling on the seamstress mediating in embroidering the customer's garment without sewing it, while making a profit? Are these transactions subject to the rulings of Ijarah or Istisna', and what is the controlling factor in that, especially concerning price determination?
What is the ruling on real estate financing through Ijarah (leasing) as practiced by Islamic banks and their branches? Is it considered permissible, or is it a circumvention of the concept of usurious interest?
Is an agreement to build a wall for one thousand dirhams considered an Istisna' contract or an Ijara (lease) contract for work, and what is the difference between them?