Settlement of a loan and interest

Question ID: 32342

AssalamuAlaikum Alaikum respected Muftisaheb

In explanation of a previous question (Question ID: 32212 question 2.) this I what I have read about a difference in amount being interest and would like confirmation please.

If you took a loan of R 100 000 to buy a car and after a few years of paying a monthly installment you accumulate enough money to pay the balance of the loan which is now 50 000. But the bank informs you that because you are paying a large amount (settlement value) you need only pay 40 000 instead of 50 000.
1.) is this difference of 10 000 considered interest?

Jazakallah Khayr, may Allah reward you well.

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Asked on January 13, 2017 10:17 am
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Answered on February 9, 2017 12:53 pm