Can Muslims Take On Debt & Make Large Purchases? | About Islam
Home > Ask About Islam > Can Muslims Take On Debt & Make Large Purchases?

Can Muslims Take On Debt & Make Large Purchases?

Questioner

Anonymous

Reply Date

Oct 19, 2017

Question

Should Muslims avoid taking on debt and making large purchases that will incur debt?

Consultant

Answer


Debt Purchases

Short Answer: Money is not evil, in and of itself; It depends on how you earn money, and how you spend that money. “Buying things that you will use and enjoy are within the permissible limits of the Islamic law. And at the same time, giving some in charity to other people especially those who are less fortunate…” However, we must live within our means and strive to “be as free of debt as possible because sometimes you’re in debt, indebted and you feel burdened by that.” We must not, under any circumstances, take interest from someone whom we have loaned money to: “Charity transfers money from the rich to the poor, but interest transfers money from the poor to the rich. And so, this is deemed to be impermissible.”


Asalamu Alaikum,

Thank you for contacting About Islam with your question.

Dr. Shabir Ally from QuranSpeaks.com addresses this question in the video below.


Transcript:

Aisha Khaja: Dr. Shabir, the question that we have is: “What do the Muslims teach about money and being in debt?”

And the viewer goes on to ask: “How does this affect our ability to purchase large items like houses and cars?”

Dr. Shabir Ally: Probably, the question is that this is hinting at is the Islamic prohibition on taking or giving interest.

 …That would explain the question about how do we purchase large items. But let me let me just give the overview.

The questioner seems to be asking what about our teaching regarding moneyand so on.

First of all, money does not seem to be a bad thing in and of itself. It seems to be a blessing from God.

It depends on how you earn it, and how you spend it.

You should earn it in a halal or permissible way and you should spend it in good things.

So, buying things that you will use and enjoy are within the permissible limits of the Islamic law.

And at the same time, giving some in charity to other people especially those who are less fortunate, so that the wealth is shared.

One of the issues that comes up is with regards to borrowing: the Muslim attitude should be to be as free of debt as possible because sometimes you’re in debt, indebted and you feel burdened by that.

Sometimes people are driven to give excuses because they can’t pay up on time, and so on.

So, a Muslim has to be forthright and truthful in all circumstances.

And sometimes that is compromised if one feels under the pressure of debt and not being able to meet the deadlines for repayment.

And taking a loan on interest has been deemed to be impermissible.

But the main issue is really the receiving of interest, which is condemned in the Quran again and again. Why?

Because the one who has extra money to be able to loan it, really doesn’t really need to claim something back from the person who needs to borrow.  

The person who needs to borrow usually is in the less fortunate situation.

And to have to pay back not only the loan, but also interest on top of the loan is really going the opposite way from charity.

Charity transfers money from the rich to the poor, but interest transfers money from the poor to the rich.

And so, this is deemed to be impermissible.

But to have nothing to do with such loans at all, Muslims have been advised not to get into any such transaction not even to take a loan on interest.

But the essential privation is with receiving interest, not giving it.


I hope this helps answer your question. Please keep in touch.

Walaikum Asalam.


(From AboutIslam’s archives)

Read more…

The Hand That Gives: Etiquette of Zakat and Sadaqa

Zakah and the Economic System in Islam

UK Introduces Halal Loans for Muslim Students

Can I Deduce My Debt from My Zakah?




About Dr. Shabir Ally

Dr. Shabir Ally holds a B.A. in Religious Studies from Laurentian University in Sudbury, Ontario, with a specialization in Biblical Literature. He also holds an M.A. and a Ph.D. from the University of Toronto with a specialization in Quranic Exegesis.

He is the president of the Islamic Information and Dawah Centre International in Toronto where he functions as Imam. He travels internationally to represent Islam in public lectures and interfaith dialogues. He explains Islam on a weekly television program called "Let the Quran Speak". Past episodes of this show can be seen online at: www.quranspeaks.com.


find out more!