Rahn

Rahn is pledging a specific piece of property as security for a debt, so the creditor can recover it if repayment fails.

What it means for me: Pledging something does not transfer its ownership; it stays yours. It only secures the debt until you repay it, or until the pledge is used to cover what you owe. Most scholars hold the pledge is not complete until the item is actually handed over.

Example: A man borrows money and gives the lender his gold jewelry to hold until he repays. If he cannot repay, the lender may sell the jewelry and take back what is owed from the price.

Do not confuse with: Kafalah in its guarantee sense — a third person standing surety for the debt, rather than property securing it. A rahn ties the debt to a specific item; that kind of guarantee ties it to a person's own promise.

If scholars differ: Scholars differ on whether the person holding the pledge may use or benefit from it while it secures the debt. They also differ on what happens if the pledged item is damaged without anyone's negligence.