Not paying credit cards debts : declaring bankruptcy to avoid payment of credit cards balances

Fatawa Question

Assalamu Alequm I have benefited from your Fatawa and advice. It is a very useful service. Please continue and Allah gives you Barakat in the effort. My question is about some loans on my credit cards. I have borrowed some money on my credit cards in USA. I do not live in USA any more. I want to be able to settle this situation with my creditors, so I won't be held responsible on the day of judgment. My creditors have transferred the loans to collection agencies. These agencies are offering me to settle by paying certain percentage of the total debt. I also have a choice of declaring bankruptcy and settle the matter. I am inclined to either make some arrangement to pay as much as I can afford or declare complete bankruptcy. My intention is to fulfill my responsibility according to the law of Allah. My financial situation is not strong. My question is following. What is my option according to the Shari’ah ? Should I make an arrangement with the creditors, or should I declare bankruptcy or should I pay the full amount. It is important to note that all three options are legal according to the laws of the country, where I used to live (USA). I am inclined on declaring bankruptcy. Please advice me, since I am worried about the consequences of appearing at the day of judgment with a debt on me. Jazzakallah

Fatwa

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Publication Date

2002-09-23

Main Subjects

Economics & Business Administration
Financial and Accounting Sciences
Islamic Studies

Topics

• Islamic jurisprudence
• Islamic economics
• Debts
• Loans
• Bankruptcy
• Credit cards
• Islamic Banks
• Debtor and creditor

No. of Pages

1

Data Type

Fatawa

Language

English

Record ID

BIM-723978

• APA
• MLA
• AMA