Answered by Mufti Mohammed Tosir Miah
A Muslim school which has a large amount of debt, would like to borrow money from the Masjid committee to pay off the school’s debt, will it be permissible for the Masjid committee to give money to the school to borrow, so that the school can pay off the debt?
There are two ways to look at your question.
The first situation is where the Masjid you intend to borrow money from needs the money themselves for their day to day running of the Masjid. In this situation it will not be permissible for the Masjid to lend money to any other religious organisations or to any Muslim schools. However, if the Masjid has any extra money and there is no need for it at present then it will be permissible for them to lend it to a Muslim school. (Fatawa Mahmoodiyah p.251 v.12 & Fatawa Rahimiyah p.187 v.2)
Only Allah Knows Best
Mohammed Tosir Miah
Darul Ifta Birmingham