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Message: <blockquote data-quote="ibnanv" data-source="post: 10514408" data-attributes="member: 218596">[FONT=arial,helvetica,sans-serif]The  linguistic meaning of the Arabic word ‘rahn’ is “settlement”, and  “permanence.” The Islamic legal meaning for rahn is “a security of a  debt by something with which the debt can be fulfilled.” In other words,  it means mortgaging an item with monetary value or collateral as  security against a debt.[/FONT]  [FONT=arial,helvetica,sans-serif]Rahn is permissible as indicated in the Book, the Sunnah and by Ijmaa’  (consensus of scholars). Allah says, “And if you are on a journey and  cannot find a scribe, then let there be a rihaan (mortgage) taken.”  (2:283)[/FONT]  [FONT=arial,helvetica,sans-serif]When the Prophet, sallallaahu ‘alaihi wa sallam, died, his armour was mortgaged.[/FONT]  [FONT=arial,helvetica,sans-serif]Scholars are in  agreement that rahn is permissible while travelling. The majority of  scholars have held the opinion that it is also permissible in residence.  The following points outline the rulings of mortgage:[/FONT]  [FONT=arial,helvetica,sans-serif]1. The wisdom behind  rahn’s validity is to preserve the wealth and protect it from loss.  Allah also commanded us to document debts in writing. He says, “O you  who believe! When you contract a debt for a fixed period, write it down  ... and if you are on a journey and cannot find a scribe, then let there  be a rihaan taken.” (2:282-283)[/FONT]  [FONT=arial,helvetica,sans-serif]This is a sign of Mercy from Allah where He guides us to do good for ourselves.[/FONT]  [FONT=arial,helvetica,sans-serif]2. For rahn to be  valid, its amount and nature should be known. The mortgager should have  the right to dispose of the item, whether he is owner or has permission  to dispose of it.[/FONT]  [FONT=arial,helvetica,sans-serif]3. It is permissible to mortgage from your money on behalf of someone else’s debt.[/FONT]  [FONT=arial,helvetica,sans-serif]4. The mortgaged item should be sellable so that the mortgage can be paid off.[/FONT]  [FONT=arial,helvetica,sans-serif]5. The rahn can be  conditioned in the contract or after the contract. Allah made the rahn  in lieu of writing a debt, as He says, “And if you are on a journey and  cannot find a scribe, then let there be a rihaan taken.” (2:283)[/FONT]  [FONT=arial,helvetica,sans-serif]6. Rahn is required  from the mortgager only because the right is for someone else. But it is  not required from the mortgagee (the lender) for he can cancel it at  any time, because it is his right alone.[/FONT]  [FONT=arial,helvetica,sans-serif]7. It is permissible to  mortgage one’s share from a partnership. This is because the share can  be sold at the time the debt is due and then it will be fulfilled. It is  also permissible to mortgage something sold for its value. For example,  if one buys a car or a house for a deferred price, then one can  mortgage it until he pays the price.[/FONT]  [FONT=arial,helvetica,sans-serif]8. Neither the  mortgager nor the mortgagee can use the mortgaged (collateral) item  without the permission of the other party. This is to protect both  parties’ rights. If the mortgager uses it, then he nullifies the right  of the mortgagee in securing the debt. On the other hand, if the  mortgagee uses it, then he is actually using something owned by others.[/FONT]  [FONT=arial,helvetica,sans-serif]9. Benefiting from rahn is permissible, but it should be agreed upon between both parties.[/FONT]  [FONT=arial,helvetica,sans-serif]10. The growth of the  rahn and the benefit derived from it becomes a rahn added to the  original rahn that can also be sold to pay off the debt.[/FONT]  [FONT=arial,helvetica,sans-serif]11. All expenses  incurred from keeping the rahn is the liability of the mortgager,  including storage, guarding the mortgage, etc.[/FONT]  [FONT=arial,helvetica,sans-serif]12. If part of the mortage gets destroyed, then the remainder becomes rahn for the entire debt.[/FONT]  [FONT=arial,helvetica,sans-serif]13. If the mortgager  pays off some of the debt, the rahn remains as the entire collateral and  none of it can be released until the entire debt is paid.[/FONT]  [FONT=arial,helvetica,sans-serif]14. When the payment of  the debt is due, the indebted party must repay the debt, just as one  must repay a debt that does not have a rahn attached. Allah says, “Let  then one who is entrusted discharge his trust (faithfully), and let him  have taqwah for Allah, his Lord.” (2:283) and “Let him have taqwah for  Allah, his Lord and diminish not anything of what he owes.” (2:282)[/FONT]  [FONT=arial,helvetica,sans-serif]If the debtor refuses  to pay, he will be accused of delay and the judge will then force him to  pay. If he continues to refuse, then he should be disciplined by  imprisonment or other means until he repays his debt or the mortgage is  sold to pay off the debt.[/FONT]  [FONT=arial,helvetica,sans-serif]The judge can also sell  the mortgage in the debtor’s place, if the debtor refuses to do so. If  there is money left after selling the mortgage and repayment of the  debt, then the excess is returned to the debtor. If there is a portion  of the debt that is not covered by the value of the collateral, then it  remains as a liability of the mortgager that must be paid.[/FONT]  [FONT=arial,helvetica,sans-serif]15. It is permissible  for the lender to use the collateral (mortgaged item) in some cases,  such as riding or milking the animal if it was mortgaged, but the lender  should spend on it and feed it. This is based on the hadith, “The  mortgaged animal can be used for riding, as long as it is fed and the  milk of the animal can be drunk according to what one spends on it. The  one who rides the animal or drinks its milk should provide the  expenditures.” (Bukhari)[/FONT]  [FONT=arial,helvetica,sans-serif]Imam Ibn al-Qayim said,  “This hadith, together with the principles of Shari’ah indicate that  the mortgaged animal should be treated with respect, and this is Allah’s  right. Its owner has the right of ownership. And the animal is in the  possession of the mortgagee, but does not milk it, then the milk is  wasted. Therefore justice, qiyas, and the welfare of the mortgager,  mortgagee and the animal require that the mortgagee benefit from the  animal in riding and milking it. This is compensated for by providing  the expenses. By benefiting from the animal and paying for its expenses,  all rights will be fulfilled.”[/FONT]  [FONT=arial,helvetica,sans-serif]Some scholars said,  “There are two types of mortgage. One requires provision and the other  doesn’t. The first type of mortgage is further divided into two  different types. One is the animal which is ridden and milked, and the  second is the slave. The latter cannot be used for benefit by the  mortgagee without the permission of the owner. The second type of rahn  that does not require provision includes a house, furniture, etc. The  mortgagee cannot benefit from this type without the permission of the  mortgager.”[/FONT]  </blockquote>

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