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Charging late fees for delayed rental payments

Published: 24/08/2011 12:05:00 PM GMT
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We own a rental property that we lease out to tenants. We have a problem with some of the tenants not paying their rent on time. Is it Islamically permissible to charge a late fee for rent that is late?


Answered by

Sheikh `Abd Allah b. Ibrâhîm al-Nâsir, professor at King Sa`ûd University

It is permissible to rent out property to others. However, stipulating that a late fee must be paid in the event of a failure of the lessee to make a timely payment is unlawful.

Such a late charge would be a form of interest. The unpaid rent is effectively a debt owed by the lessee to the landlord. In Islamic Law, a debt that is owed by someone can neither be postponed for a higher amount nor penalized with a fee.

And Allah knows best.

Source: Islam Today




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