He has a debt for something haraam – should he repay it?

He should look at this forbidden thing and if the
transaction was with a Muslim, then it is not permissible for him to pay the debt, because
when Allaah forbids a thing He also forbids its price, and because whatever it is
forbidden to sell in Islam has no price. The Prophet
(peace and blessings of Allaah be
upon him) forbade the price of a dog and said: “If he comes asking for its price,
then fill his palm with dust.” This is reported in Al-Saheeh from the hadeeth
of Ibn Abbaas.

It was reported from Abu Mas’ood al-Ansaari (may Allaah be pleased
with him) that the Messenger of Allaah
(peace and blessings of Allaah be upon him)
forbade the price of a dog, the earnings of a prostitute and the fee (hulwaan) of a
fortune-teller

(narrated by al-Bukhaari, 2083). The word hulwaan
comes from the phrase “halawtuhu hulwaanan”, meaning “I gave it to
him”; the root of this word is al-halaawah (meaning “sweet”) and it
is likened to something sweet because he takes the money so easily, without having to work
hard or make any effort… Hulwaan also means “bribe.”

But if a person is forced to repay the debt, then in this case he
should pay it whilst seeking the forgiveness of Allaah and repenting to Him for buying
haraam things, whether from a Muslim or anyone else.

If the transaction was with a non-Muslim in whose religion the thing he
sold is not viewed as forbidden, then the debt has to be paid whilst also repenting. The
Muslim has to avoid dealing in things that Allaah has forbidden.