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The question

What is the ruling on a lease-to-own contract offered by a bank, in which the following points appear: the high value of the rent, which represents ownership value and not usufruct; the contract duration being predetermined and not allowing for early termination by the lessee; the lessee bearing the costs of insurance and maintenance; the absence of a late payment penalty; the termination of the contract in case of non-payment of rent, with the lessee not recovering what they have paid; and the bank's request for additional guarantees?

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Source: FtawySummarized from the full answer at Ftawy · imported Sep 2, 20261 min readAlso available in العربية
The answer

It is permissible to conclude an Muntahia Bittamleek (lease ending in ownership) contract if it is coupled with a promise to sell or donate the asset after the full rent has been paid, provided that the lease is a genuine one and not a cover for a sale. The leased asset must be guaranteed by the lessor (the company or bank), not the lessee. Non-operational maintenance expenses must be borne by the lessor throughout the lease period. The lessee should not be obligated to insure the asset; rather, insurance should be the responsibility of the owner, if any. Operational maintenance falls upon the lessee. Stipulating maintenance on the lessee leads to ambiguity in the rent, which invalidates the lease. It is preferable to purchase through Murabaha if the conditions for a valid lease cannot be met.

Summarized from the full answer at Ftawy · imported

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Where this answer came from
Source platform
Ftawy
Original fatwa ID
20808
Imported
Translation status
Source text, unreviewed
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