Is It Permissible to Buy a Car with a Retention of Title Clause?
Hanafi Fiqh
Answered by Mawlana Ilyas Patel
Question
Is it permissible to buy a car in installments with a retention of title clause, where the seller retains ownership until full payment? If not, would it be allowed if we ensure full repayment?
Answer
In the Name of Allah, the Most Merciful and Compassionate.
I pray you are in good faith and health. Thank you for your question.
As the buyer, you must hold ownership while the seller retains a lien as security. Other scholars permit retention of the title clause, ensuring that the seller can maintain ownership until full payment is received.
It is permissible for a seller to stipulate that the sold item itself serves as collateral for its price. This means the seller retains ownership of the item until the buyer completes all payments. Such an arrangement ensures the seller’s rights are protected and is considered valid under Sacred Law. [Bahuti, Kashshaf al-Qina]
I would like you to go through the valuable answers and links below. Insha’Allah, you will receive guidance and direction.
Related
- How to Deal with Riba in Buying a House or Car?
- Particular and general Liens – Summary of the law in England
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I pray this helps with your question.
Wassalam,
[Mawlana] Ilyas Patel
Checked and Approved by Shaykh Abdul-Rahim Reasat
Mawlana Ilyas Patel has received traditional education in various countries. He started his schooling in the UK and completed his hifz of the Quran in India. After that, he joined an Islamic seminary in the UK, where he studied secular and Aalimiyya sciences. Later, he traveled to Karachi, Pakistan, and other Middle Eastern countries to further his education. Mawlana has served as an Imam in the Republic of Ireland for several years and taught the Quran and other Islamic sciences to both children and adults. He also worked as a teacher and librarian at a local Islamic seminary in the UK for 12 years. Presently, he lives in the UK with his wife and is interested in books and gardening.
