Charging late fees for delayed rental payments
24 Aug 2011 12:05 GMT
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

-- Al Arabiya Digital