Can a Muslim Woman File for Bankruptcy on Debts?

Answered by Shaykh Yusuf Weltch

Question

Is it permissible for a muslim woman to file for bankruptcy? I cannot pay my debts with the electric company, bank, credit cards, cash advances, or medical bills. Someone told me to look into bankruptcy, but first, is this permissible for a Muslim?

Answer

In the Name of Allah, the Most Merciful and Compassionate.

Payment of debts is among those issues that Islam highly encourages.

Allah Most High says,

“O believers! Honour your obligations.” [Quran; 5:1]

And,

“Indeed, Allah commands you to return trusts to their rightful owners; and when you judge between people, judge with fairness. What a noble commandment from Allah to you! Surely Allah is All-Hearing, All-Seeing.” [Quran; 4:58]

Repaying Debts

Suppose a Muslim assumes the responsibility of paying a debt. In that case, they must first have a strong resolve to attempt repayment, even if they slowly chip away at the debt over an extended period.

The Messenger of Allah (Allah bless him and give him peace) said,

“Whoever takes people’s money intending to pay it back, Allah will (help them) pay it back; and whoever takes it, intending not to pay it back, Allah will render it void of benefit.” [Bukhari]

Extenuating Circumstances

Only in very extreme circumstances can one declare bankruptcy

Advice

Make a firm intention in your heart to do your best to pay off these debts. Thereafter, seek to put some money, even if a little, towards these debts consistently. Consider seeking Zakat as assistance. Lastly, turn to Allah Most High in prayer and supplication to help you fulfill your debts. The following are Prophet supplications you can use:

Recite after each prayer

اللّٰهُمَّ إني أعُوذُ بِكَ مِنَ المأْثَمِ وَالمَغْرَم
Allahumma inni a‘udhubika min al-ma‘tham wa al-magram

“O Allah, I seek your protection from sin and debts.” [Bukhari]

Recite every morning and evening:

اللهُمَّ إنّي أَعُوذُ بِكَ مِنَ الهَمِّ والْحَزَن، وأعوذ بك مِنَ الْعَجزِ وَالكَسل، وأغوذ بك من الجُبْنِ والبُخْل، وأعوذ بك مِنْ غَلَبَةِ الدَّين وَقَهْرِ الرجال
Allahumma inni a‘udhu bika min al-hammi wa al-hazan, wa a‘udhu bika min al-‘ajzi wa al-kasl, wa a‘ udhu bika min al-jubni wa al-bukhl, wa a‘udhu bika min ghalabah al-dayn wa qahr al-rijal.

O Allah, I seek refuge in You from worries and difficulty, and I seek refuge in You from inability and laziness, and I seek refuge in You from cowardice and miserliness, and I seek refuge in You from the dominance of debt and being subjected to man. [Ibid.]

Hope this helps
Allah knows best
[Shaykh] Yusuf Weltch
Checked and Approved by Shaykh Faraz Rabbani

Shaykh Yusuf Weltch is a teacher of Arabic, Islamic law, and spirituality. After accepting Islam in 2008, he went on to study at Darul Uloom Seminary in New York and completed his studies at Darul Mustafa in Tarim, Yemen.

There, he completed the memorization of the Quran and his study of Islamic Sciences. Throughout his years of study, he was blessed to learn from many great scholars: Habib Umar bin Hafiz, Habib Kazhim al-Saqqaf, Shaykh ‘Umar bin Husayn al-Khatib, and others.

Upon returning, he joined the SeekersGuidance faculty in the summer of 2019.