Works and transactions in real estates : assigning a purchased real estate to another buyer
Fatawa Question
[Question One] : Assalamu Alaikum Warahmatullah This is Zaid from Hawthorne Masjid. I attended your 2-week class on Islamic financial issues. I am learning about real estate investing and I came across a method called "Wholesaling". I wanted to know if this type of transaction of allowed in Islam. Here is a basic example. 1. You find a seller who will sell his house to you for $ 100,000. Full market value is $ 150,000 but he is in distress or has a dire need to get rid of it. 2. You put the house under a sales contract and give him $ 2000 earnest money deposit. You must close in 30 days or he keeps your $ 2000 and you get nothing 3. You call up your list of buyers and find someone who will buy it from you for $ 110,000 4. You do a double closing at escrow with buyer and seller and collect the $10,000 difference Question # 1: is this allowed ? Question # 2: what aspects of it make it not allowed ? Question # 3: if this is not allowed, do you know of any real estate investment methods that are ? If you need more details let me know. I can send you the forms and contracts involved [Question Two] : Assalamu Alaikum whats your address ? This is Zaid from ……………….. Masjid again. Thank you for replying to my question. I forgot that there is another option in wholesaling. You can "assign" the actual contract to another buyer for a fee, handing over your right to buy at the contract price to that person. There are no two closings at escrow. Basically selling your right to buy to someone else is it's own contract that stipulates how much the new buyer is paying you. You are out of the transaction after that. There's only one closing between seller and "new" buyer. Is this allowed ? Jazakallahu Khair
Fatwa
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Publication Date
2006-01-17
Main Subjects
Economics & Business Administration
Islamic Studies
No. of Pages
2
Data Type
Fatawa
Language
English
Record ID
BIM-788587
American Psychological Association (APA)
Qahf, Mundhir. 2006-01-17. Works and transactions in real estates : assigning a purchased real estate to another buyer. .
https://search.emarefa.net/detail/BIM-788587
Modern Language Association (MLA)
Qahf, Mundhir. Works and transactions in real estates : assigning a purchased real estate to another buyer. 2006-01-17.
https://search.emarefa.net/detail/BIM-788587
American Medical Association (AMA)
Qahf, Mundhir. 2006-01-17. Works and transactions in real estates : assigning a purchased real estate to another buyer.
https://search.emarefa.net/detail/BIM-788587
