Praise be to Allaah.
Dealing with riba is emphatically forbidden and is a major
sin. The one who gets involved with any of that has to repent to Allah,
resolve not to go back to riba and pay off what he owes of the capital,
but he does not have to pay off the interest; he should try to get out of
paying unless he is forced to do so and cannot find any way of avoiding
Some of the ways of avoiding paying interest are:
Hastening to pay it off. If
hastening to pay off the debt will cause the interest to be waived, and he
is able to do that, then he should do it so as to protect his wealth and cut
off any connection to riba.
See the answer to question no.
Some of the scholars say that
it is permissible to delay paying the bank if it is known that the bank will
waive the interest charges after the delay. See the fatwa of Shaykh Ibn
‘Uthaymeen (may Allah have mercy on him) in the answer to question no.
With regard to declaring bankruptcy, we do not know the
nature of that in your country or the consequences thereof for you and for
your creditors. So you should ask scholars in your country about that.
There are shar‘i rulings concerning bankruptcy which we will
sum up as follows:
A debtor may be deemed bankrupt
if he has no wealth or he has wealth but it will not cover the debt that is
currently due. With regard to debts that are not yet due, the one who owes
them cannot be deemed bankrupt.
The bankrupt individual may
have his assets frozen if his creditors or some of them request that, so
that he will not harm them by that.
If his assets are frozen, then
any transaction he does, whether buying or selling, establishing a waqf or
giving a gift, is not valid.
The ruler or qaadi (judge) may
sell his property in order to pay off his debts and leave him nothing except
what is necessary for him, such as his dwelling, his books, his clothing,
the tools of his trade, and the capital of his business; he may sell
everything apart from that.
See: al-Mulakhkhas al-Fiqhi by Shaykh al-Fawzaan,
2/92; al-Sharh al-Mumti‘ by Shaykh Ibn ‘Uthaymeen, 9/268;
al-Mawsoo‘ah al-Fiqhiyyah, 5/300
In some countries the state gives help to the person who has
been deemed bankrupt. It is obvious that this help is not permissible for
the one who is not really bankrupt, because that comes under the heading of
consuming wealth unlawfully.
And Allah knows best.