What is the ruling on transactions in which a car and real estate company sells at a cash price of $5,000, and adds an increase for deferred payment when selling in installments? And what is the criterion that distinguishes installment sales from usury?
Source: FtawySummary from Ftawy's records · added here Sep 2, 2026
There are two scenarios for selling in installments: The first is permissible if a specific, known price is agreed upon by both parties and is not subject to increase, even if the installment price is greater than the cash price. The second is prohibited if interest is calculated on late payments, as this is considered usury (riba), and calling it "services" does not change its true nature.
Summary from Ftawy's records · added here
Reviewed by El Fatwa's sharia committee.
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- Ftawy
- Original fatwa ID
- 70680
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- Summary from Ftawy's records, reviewed by El Fatwa's sharia committee.
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- Read the full answer on Ftawy