Wants to lend his friend a loan and get Halaal profit from it

2-4-2009 | IslamWeb

Question:

I have my investments, from where i get halal profits. Someone close need a loan for a house to purchase. How could i lend money to a friend and get halal profit on my investement. Can i ask for rent of the property. In interest of helping a friend from bank interest and make halal profit, though i am satisfied by the profit that i get from the other resource around 21% to 23 % .

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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.

 

The matter which you want, which is making your friend avoid Riba (interest and/or usury) is something that you are going to do yourself if you give him a loan and condition on him to rent his house to you; for more benefit, please refer to Fataawa 89965 and 90254.

You should know that there are two kinds of contracts:

-Irfaaq Contracts (which are meant to provide relief): among which is the loan; the purpose of such contracts is helping a person and supporting him and not gaining profit from him, and it is not permissible to condition a profit or a benefit from it.

-Compensatory contracts: like selling, hiring and the like.

Indeed there is a way to be kind to your friend and benefit from your money, and that is by buying the house yourself and when you possess it, you would sell it to your friend with a delayed payment that is of higher price than the price with which you bought it.

For more benefit, please refer to Fatwa 82986.

Allaah Knows best.