Question Summary:
i wanted to ask that we have had a car financed from an islamic bank here in Sharjah, UAE. its been two years. According to the bank, it’s interest free….

Question Detail:

i wanted to ask that we have had a car financed from an islamic bank here in Sharjah, UAE. its been two years. According to the bank,  it's interest free.

 firstly please tell me is this halal? secondly, we are in need of an other car too because i have kids and its difficult to manage with one car, but we don't have enough cash in hand to be able to buy a car. Should i get another car financed by this islamic bank also, or if its haram may be i can get a rent-a-car for a year or two? will that be permissable?
i had heard a muslim preacher answer this question on TV. that financing is not wrong because it is a business where a party has given money on your behalf so you owe them money, but the high rate is wrong. i am very confused. kindly do reply and help me.
plus if its haram i may not lease a new car but settling the previoius one will require us to pay money to the bank. my husband and i did consider that. we are not apprehensive about the loss but about paying additional money from our pocket which we don't have. because we need to pay a lot of credit card loan.
we have realised the sins and are trying to repent and start all over as far as finances are concerned. but, it happens with time as we are salaried people. please pray and help me by replying soon.

Answer :

In the name of Allah, Most Gracious, Most Merciful
Assalaamu `alaykum waRahmatullahi Wabarakatuh
It is encouraging to note your zeal to repent from the sin of interest. We pray that Allah forgives your sin and bless you in your sustenance. Ameen.
Interest is expressly prohibited and incurs the wrath of Allah. Consider the following…
Allah says:
                                                                                           
فَإِنْ لَمْ تَفْعَلُوا فَأْذَنُوا بِحَرْبٍ مِنَ اللَّهِ وَرَسُولِهِ [البقرة/279]
((And if you do not do it i.e. leave out interest, then take a notice of war from Allah and his messenger))
 
لعن رسول الله صلي الله عليه وسلم آكل الربوا وموكله وكاتبه وشاهديه(رواه مسلم و الترمذي)
((Nabi (sallallahu alayhi wasallam) has cursed the one who devours interest and…, the one who records the transaction and the two witnesses)) (Muslim and Tirmidhi)
In another hadith Nabi (sallallahu alayhi wasallam)
درهم ربا يأكله الرجل وهو يعلم أشد من ستة وثلاثين زنية (رواه احمد و الدار القطني)
((A dirham of interest which a person eats intentionally is worst than committing adultery thirty six times)) (Narrated by Ahmad and Dar al Qutni)
Allah has promised to destroy (transactions of) interest in the following verse
 
يَمْحَقُ اللَّهُ الرِّبَا وَيُرْبِي الصَّدَقَاتِ
(Allah will destroy interest and will give increase for Sadaqat)
We advise you to make adjustments in your life and live in accordance with what is affordable. It is better to be without luxuries than having them and being burdened with paying interest. The luxuries burdened with interest will be meaningless and insignificant.
We cannot comment on the bank in reference as we do not know how they conduct their deals. Besides being interest free, there are numerous other factors which have to be considered. Sometimes such conditions are stipulated during the contract which invalidates the entire transaction. Therefore, it is imperative for us to study the entire transaction in detail in order to pass any verdict. Kindly send the exact contracts of the bank for our review.
And Allah knows best
Wassalam
Ml. Ismail Moosa,
Student Darul Iftaa
Checked and Approved by:
Mufti Ebrahim Desai
Darul Iftaa, Madrassah In'aamiyyah