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Fatwa CenterBuying a car through a finance company
Question
I would like to buy a car through a finance company paying a down payment and rest will be in 36 months installments. My question is, there will be an interest calculation on this deal. Hence the car company tied up a deal with a certain finance company, i will not able to go for any other finance company. Moreover, i also working in the same car company and the company is giving a staff discount on this deal and that amount will be higher than the total interest. pls. clarify.
Answer
All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad 
is His slave and Messenger.
If the finance company owns the car first and the car becomes in its possession before it sells it to you and the company does not set a condition that you will be fined in case of delay in payment, then it is permissible for you to deal with it, but if the company only pays the price on your behalf to the car company and then it gets the price from you with interest, then this is Riba (interest and/or usury) which is forbidden.
For more benefit on purchasing by installment and its conditions and the permissible and impermissible method of buying by installment, please refer to Fatwa 81662.
Allaah Knows best.
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