Interest Funds
| Fatwa #820 | Category: Business & Trade | Country: Zambia | Date: 4th March 2024 |
| Fatwa #820 | Date: 4th March 2024 |
| Category: Business & Trade | |
| Country: Zambia | |
Question
When buying our house, the attorney of the seller of the house needs to be given the money, which they keep in their trust account, until the transfer and registration from the seller to us (the buyer) takes place. This period takes approx 3-5 months, during which the moneys kept in the attorney’s trust account earns interest, which belongs to and is given to us ( the buyer ). We asked the attorney of the seller if they can instead keep the money in a shariah compliant bank account so that at least the profits earned on this during the 3-5 month period is islamically acceptable…but they refused. Also in the 3-5 month period during which the process of registration takes place from old owner (seller) to us (the buyer), because we (the buyer) is already staying in the house that is being bought, we are due to pay the seller, (occupational) rental, until the transfer and registration to new owner/ buyer (ie us) takes place. Also with the occupational rental, we have to also pay additional for our electricity usage in this time….(our water usage was agreed to be included in the occupational rental). So in summary, from October 23 until end Jan 2024, was the period that it has taken( for the transfer of ownership from the seller to us the buyer) during which we have been staying on the property, and have been due to pay rental of R8500 (incl water) per month and separate for electricity usage. The attorneys fees is 25000 which we, the buyer r due to pay. The interest earned and due to us, the buyer, is approx R4200 for 3months…ie approx 12.5k.
Is it permissible to use/ offset the interest earned for any of the expenses/costs due by us the buyer:
Eg attorney transfer costs R25000 or,
Occupational Rental costs R34000 (total for 4months) or,
Municipality: our Rates & Electricity Charges total (incl upfront payments for rates & elec until approx April 2024) R8300.
this is what the attorney has suggested as shown in the proforma invoice, where they have deducted the amount(R8400)(+ R4200 expected to be earned by end Jan2024 not deducted yet in the above invoice)…which is interest earned (by our money kept in their trust account) from the total amount of costs that we are due to pay the attorney (consisting of purchase price of house , attorney fees & municipality rates & electricity fees).
If the answer is no: Interest cannot be used for any of the above costs, then this brings me to my 2nd Question about the Interest:…
Can the interest money be used to :
2. To pay towards another person’s interest charges for arrears in their rental account? This person is an elderly family member who is not employed, receiving a monthly sassa grant, but getting financial assistance from other family members to meet her monthly rent expense, …but also she is not liable to collect zakat….actually she is liable to pay zakat every year as she has invested savings
Jzk khayr for your advice
Answer
In the Name of Allah, the Most Gracious, the Most Merciful.
As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.
As for your first query, it is not permissible to use the interest funds to offset legal fees, occupational rent or municipality charges. Interest funds must be disposed off to the poor and needy without any intention of reward.[1]
Coming to your second query, the individual in reference appears to have sufficient funds of her own especially since she is paying her own zakat. Accordingly, the interest funds cannot be given to her, rather they should be given away to a deserving poor person, preferably a Muslim.
And Allah Ta’āla Knows Best
Mufti Bilal Pandor
Concurred by
Mufti Muhammad Patel
Darul Iftaa Mahmudiyyah
Lusaka, Zambia
وصار هذا كالمقبوض بغير إذنه فإنما حصل له الربح فيه بسبب خبيث شرعا والسبيل في الكسب الخبيث التصدق
البحر الرائق شرح كنز الدقائق ومنحة الخالق وتكملة الطوري (8/ 229)
قالوا وعلى هذا لو مات رجل وكسبه من ثمن الباذق والظلم أو أخذ الرشوة تعود الورثة ولا يأخذون منه شيئا وهو الأولى لهم ويردونه على أربابه إن عرفوهم، وإلا يتصدقوا به؛ لأن سبيل الكسب الخبيث التصدق إذا تعذر الرد