C4. Dealing Harshly When Lending Money or Collecting Debts. [Make a Comment]
We are not to deal harshly when lending or while collecting debts.
This precept is derived from His Word (blessed is He):
Key Scriptures
Exodus 22:24(25)
(Maimonides RN234; Meir MN52; Chinuch C67)
If you loan money to one of my people who is poor, you are not to deal with
him as would a creditor; and you are not to charge him interest.
Exodus 22:25-26(26-27)
(Maimonides RP199, RN240; Meir MN61; Chinuch C586, C587)
If you take your neighbor's coat as collateral, you are to restore it
to him by sundown, because it is his only garment - he needs it to wrap his
body; what else does he have in which to sleep? Moreover, if he cries out to
me, I will listen; because I am compassionate.
Deuteronomy 15:3
(Maimonides RP142; Chinuch C476)
You may demand that a foreigner repay his debt, but you are to release your
claim on whatever your brother owes you.
Deuteronomy 15:9
(Maimonides RN231; Meir MN56, MP62; Chinuch C480)
Guard yourself against allowing your heart to entertain the mean-spirited
thought that because the seventh year, the year of sh'mittah is at
hand, you would be stingy toward your needy brother and not give him
anything; for then he may cry out to Adonai against you, and it will be your
sin.
Deuteronomy 23:21(20)
(Maimonides RP198; Chinuch C573)
To an outsider you may lend at interest, but to your brother you are not to
lend at interest, so that ADONAI your God will prosper you in everything you
set out to do in the land you are entering in order to take possession of
it.
Deuteronomy 24:6
(Maimonides RN242; Meir MN58; Chinuch C583)
No one may take a mill or even an upper millstone as collateral for a loan,
because that would be taking as collateral the debtor's very means of
sustenance.
Deuteronomy 24:10-13
(Maimonides RP199, RN239, RN240; Meir MN59, MP63; Chinuch
C585-C587)
When you make any kind of loan to your neighbor, you are not to enter his
house to take his collateral. You must stand outside, and the borrower will
bring the collateral outside to you. If he is poor, you are not to go to bed
with what he gave as collateral in your possession; rather, you must restore
the pledged item at sunset; then he will go to sleep wearing his garment and
bless you. This will be an upright deed of yours before ADONAI your God.
Deuteronomy 24:17
(Maimonides RN241; Meir MN60; Chinuch C591)
You are not to deprive the foreigner or the orphan of the justice which is
his due, and you are not to take a widow's clothing as collateral for a
loan.
Commentary
The first thing to notice is that one should not consider himself a creditor when one lends money to a poor brother (Exodus 24(25)). Scripture establishes a different standard when the loan is to a brother Jew and especially if it is for compassionate reasons. This is clear in the Scriptures that deny interest to the lender and limit his collection options. Notice also that the lender is to treat the borrower so as to preserve both his safety and dignity, as we see in Deuteronomy 24:10-13 which prohibits the lender from entering the borrower's house to remove collateral, and requires that the lender return needed collateral to him at night. Notice also that importance is given to maintaining the borrower's good relationship with the lender and his having gratitude for the lender's compassion in having concern for his welfare.
The lender has no recourse of collection against a brother for a debt which the brother is unable to pay, but such is not the case with a loan made to a foreigner. In making a loan to a foreigner, interest may be charged and collection means employed if the loan is defaulted upon. Nevertheless, compassionate justice is due everyone, including the foreigner, so the overall torah of this Mitzvah is that we are not to deal harshly or unreasonably when lending money, or collecting debts from anyone.
As with other mitzvot, that date back to the Mosaic period, the foreigner or stranger was the Gentile who was not part of the camp of Israel, and was most likely an idol-worshipper. With the New Covenant, Gentile believers in Yeshua become brothers and members of the commonwealth (national life) of Israel through grafting into the olive tree (Romans 11:17; Ephesians 2:12), so this mitzvah and others like it should apply to them as though they are Jews.
It is fairly easy to apply this Mitzvah when a loan is made by and individual to an individual. However, in this day and age, many loans are not personal but rather corporate, and in such case the Mitzvah is difficult to apply. Consider, for example, the plight of a Jewish bank officer who facilitates his bank's loan to another Jew and, when the loan is defaulted upon, called to foreclose on the borrower's house in order to collect the loan. Since the bank officer does not own the loan and is duty bound to represent his employer's interest, it is my opinion that he can participate in the foreclosure after making every effort to help the borrower solve his financial difficulty.
Classical Commentators
Interestingly, both Maimonides and HaChinuch, in their respective
mitzvot, go beyond what Deuteronomy 15:3 and
Meir does not deal with Deuteronomy 15:3 at all, and I do not believe that following Maimonides' and HaChinuch's emphasis of harshness toward unbelievers or even idolaters is in keeping with the New Covenant's commandments that we attempt to lead them to Messiah and win their souls for God.
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