I had been a government servant in my country and at that time there was an allotment of housing facilities for a certain class of employee and I satisfied all the requirements. However, the condition for getting the apartment was that:
1) If I pay one installment the price of the apartment would be 160,0000. If I pay installments over 10 years then the price would be 200,000. If I pay the total amount in 25 years then the price would be 250,000. I preferred the last one. Accordingly, I paid the required amount for the application and did everything necessary. Now, were these increases considered as interest?

Praise be to Allah, the Lord of the Worlds; and may His blessings and peace be upon our Prophet Muhammad and upon all his Family and Companions.

 If the sale is agreed on by installments and a deadline is fixed for these installments to be paid in, without a condition of an increase (interest) when there is a delay in repayments, this contract is permissible.  This is considered as selling by installments, and this is permissible. However, if the contract is concluded without defining or specifying any of these three conditions between the contractors, or if in case of delay there is interest, this contract is Haram and void.  In this case there is a condition of usury and interest.

The evidence about the permissibility of the first case is the Saying of Allah: {O you who believe! When you contract a debt for a fixed period, write it down. ….}[2:282].

Another evidence is the story of Barirah a slave-girl who bought her freedom from her masters with 9 Awqiyah ( about 119 gram of silver) giving one Awqiya each year. This is selling by installments which the Prophet (Sallallahu Alaihi wa Sallam) did not forbid.