Debt and Loan: Forcing a Bankrupt Debtor to Sell Property for Debt Repayment

Practical Laws of Islam as per the teachings of Imam Khamenei

Debt and Loan: Forcing a Bankrupt Debtor to Sell Property for Debt Repayment

English:

Question #1754:

A businessman became bankrupt. All what is left for him is a building that he put in the market for sale. The proceeds from the sale of the building would not be sufficient to pay off half of the total debt. Is it permissible for the creditors to force him to sell the property, or should they wait for him to settle his debts gradually?

Answer #1754:

If the debtor and members of his family do not take the building as a residence, there is no objection to forcing him to sell it to pay off his debt, even though the proceeds would not be sufficient to settle the debt. For this part of the debt, it is not obligatory on the creditors to give him a period of grace. Nevertheless, they should wait for him to pay them back when he can afford it as far as the rest of the debt is concerned.

-Imam Khamenei, Practical Laws of Islam, Importance and Conditions of Debt and Loan