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Fatwa #1350622 September 2005Saudi Arabia

want to buy a car and I approach the dealer they have two scheme either I can pay the amount in lumsum or I can pay 20% downpayment and rest in equal installments for 1year,

Question

I stay in Saudi Arabia, I want to buy a car and I approach the dealer they have two scheme either I can pay the amount in lumsum or I can pay 20% downpayment and rest in equal installments for 1year, 2year or 3year  but on this scheame they are charging 8% extra amount regardless of  time period. I want to know that, this kind of transaction is halal or not. 

Answer

If you had agreed on the full purchase price with the dealer, then the transaction will be valid.

and Allah Ta'ala Knows Best

Mufti Ebrahim Desai

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want to buy a car and I approach the dealer they have two scheme either I can pay the amount in lumsum or I can pay 20% downpayment and rest in equal installments for 1year, | Fatwa Explorer