Should I Give Out a Loan to a Close Relative if I’m Already in Debt?

Answered by Shaykh Faraz A. Khan

Question: We recently received a request from a close relative to lend him substantial loan which he promised to pay back in a few months. The problem is, we already have debt of over $10,000! I know this person’s need is genuine and I would feel guilty about refusing him a loan ….. But I need to know what the shariah/sunnah recommends about taking on additional debt on oneself when a close relative asks for a loan. Please advise. I want to do what will please Allah (SWT). The only reason I cannot imagine saying yes to giving this relative a loan is because I am heavily in debt myself and do not have any immediate means to pay off my own debt, let alone take another loan on somebody else’s behalf.

Answer: Assalamu alaikum wa rahmatullah,

I pray this finds you in the best of health and states.

Your Financial Priority

Your number one financial priority is to repay your debts: they take precedence even over zakat, hajj, and estate division. [Ala’uddin Abidin, Hadiyya Ala’iyya]

Giving out a loan, then, would be of lower priority according to the Sharia. Politely tell your relative that you are unable to lend out the money.

Your intention is very noble, and you will be rewarded for it inshaAllah. Our Beloved Messenger (peace and blessings be upon him) said, “Actions are only by intention, and every person will have only what he intends.” [Bukhari, Muslim]

Other Ways of Helping

Having said the above, your inability to lend out money does not mean you cannot help out in some other manner. Try to facilitate the matter for your relative, see if you can find others to lend money, and encourage your relative to be steadfast and patient during this time of need.

The Prophet (peace and blessings be upon him) said, “Allah aids and supports the servant so long as the servant aids and supports his brother.” [Muslim]

As well as, “Do not consider any good act as insignificant, even if only meeting your brother with a cheerful face.” [Muslim]

As well as, “Whoever points to the good has the reward of its doer.” [Muslim]

In Surat al-`Asr, Allah Most High states that the human being is in a state of loss, except for the righteous, whose last description in the surah is, “They enjoin others in patience.”

And Allah knows best.

wassalam
Faraz

Checked & Approved by Faraz Rabbani