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The question

What is the ruling of Sharia regarding the inclusion of two conditions in a contract for the purchase of an apartment under construction: one stipulating a 10% penalty on overdue amounts in case of delayed payment, and another for the annulment of the contract and deduction of 30% of the total amount paid if payment is not made after a warning? And does this fall under usury (riba)?

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Source: FtawySummary from Ftawy's records · added here Sep 2, 20261 min readAlso available in العربية
The answer

One who is late in paying a debt is either a procrastinator, in which case his matter is referred to the courts, or he is in straitened circumstances, in which case he must be granted a delay, and it is commendable to give him charity by waiving the debt. Stipulating a late payment penalty, whether 10% or 30% deducted from the amount paid, is a form of pre-Islamic usury (riba al-Jahiliyyah) that is forbidden by Islamic law. Allah has warned those who engage in it of war. Therefore, the condition of a late payment penalty in the contract is void, and it must be cancelled or the contract rescinded.

Summary from Ftawy's records · added here

Reviewed by El Fatwa's sharia committee.

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Where this answer came from
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Ftawy
Original fatwa ID
92320
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.
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Read the full answer on Ftawy