Bible Lesson On Debt
Deuteronomy 28:12 says Israel will not be a borrower nation:
“The Lord will open for you His good storehouse, the heavens, to give rain to your land in its season and to bless all the work of your hand; and you shall lend to many nations, but you shall not borrow.”
Deut 15:6 likewise says: “For the LORD your God will bless you as He has promised you, and you will lend to many nations, but you will not borrow; and you will rule over many nations, but they will not rule over you."
However, some Christian commentators apparently ignorant of this verse say God does not disapprove of God's people borrowing:
The Bible neither expressly forbids nor condones the borrowing of money. ("What Does The Bible Say About A Christian going into debt?").
Let's see whether the Bible gives more direction on this important topic.
Debt is Slavery
"The rich rules over the poor, And the borrower becomes the lender's slave." (Prov. 22:7.)
Even though God discourages borrowing, God wants us to lend to others. (Deuteronomy 15:6, 28:12, Matthew 5:42)
If we do borrow (when we are discouraged from doing so), we are required to pay back what we borrowed. (Psalm 37:21, Ecclesiastes 5:4). The only exception is when we are entitled to enjoy the Biblical equivalent of bankruptcy -- the discharge of all debts every seven years. Deut. 15:1.
Charging any interest is prohibited in the Bible, at least among Israelites. (See next section "Debt & Interest in Judaism".)
Interest could be charged non-Israelites and the purpose was to help the poor. Proverbs 28:8 says:
8 Whoever multiplies his wealth by interest and profit gathers it for him who is generous to the poor
In Deut 23:21 (Tanach) says: "You may [however,] give interest to a foreigner, but to your brother (Israelite) you shall not charge interest, in order that the Lord, your God, shall bless you in every one of your endeavors on the land to which you are coming to possess." (Tanach by Chabad.org.) See Deut. 23:20 from NIV, NLT, etc. at bible.cc.
In "Loans and Interest" in Wikipedia, it says this emphatically:
Another significant loophole in the law was the biblical permission to charge interest on loans to non-Israelites.....
Thus, Jews, in reliance on this passage in Deuteronomy, believed by Medieval times that they could loan to Christian Kings while Christians had long adopted a law that no Christian could lend another Christian money at interest; it was a very serious sin and crime. (See "Loans and Interest," Wikipedia.)
This allowed Jewish money-lenders a virtual monopoly on this trade in Christian lands, which over time was used to cast them in a bad cultural light among Christians. But Jewish people were following Biblical principles. It was the Christians who did not follow the Bible who borrowed at interest from them despite the Bible not condoning God's people doing so. So the Christian borrowing at interest despite God's discouraging words was wrongly cast by Christians as a problem inflicted by Jews -- Christians expressing sour grapes that their financial problems were due to Jewish money lenders rather than their own fault for borrowing at interest.
Regardless, what about Proverbs 28:8 where it says the one collecting interest does so for the poor? This may mean that God will take the interest from those who lend to others and give it to the poor. Thus, the one who multiplies his wealth by interest and profit will end up giving it to God who in turn gives it to the poor.
The Law does clearly prohibit charging interest on one category of loans regardless of whether they were Gentile or a fellow-Israelite—those loans made to the poor (Leviticus 25:35-38)
Here is a discussion of Debt at this Christian website --
Debt & Interest in Judaism
In Wikipedia in its article entitled "Loans and Interest in Judaism," we read:
The Torah and Talmud encourage the granting of loans, but only if it doesn't involve interest, with certain exceptions. Charging interest is classed in the Book of Ezekiel as being among the worst sins, and is forbidden according to Jewish law. The Talmud dwells particularly on Ezekiel's condemnation of interest, where Ezekiel denounces it as an abomination, and metaphorically portrays usurers as people who have shed blood.
The Torah expresses regulations against the charging of interest in Exodus 22:25–27, Leviticus 25:36–37 and Deuteronomy 23:20–21. In Leviticus loans themselves are encouraged, whether of money or food, emphasizing that they enable the poor to regain their independence, but, like the other two places in the Bible, forbids the charging of interest on the loan. All three places state that the charging of interest is exploitative. In Exodus and Deuteronomy it is clear that it would be acceptable to charge interest on any loan to a non-Jew.
Loans could be secured.
Evidently the concept of secured loans existed, as Exodus expressly prohibits using a particular garment as the security. The garment in question was a large cloth square, which the poor used for sleeping within, and hence the garment was needed to survive the cold nights; had it been offered as security, then this would have put at risk the very life of the debtor. The Deuteronomic verse expresses a similar concern for the security of the debtor's life, but rather than prohibiting a particular garment from becoming the security for a loan, prohibits instead the use of a millstone. The millstone was used to make flour, and hence would be required for the manufacture of bread – a staple food among the poor; had the millstone been offered as security, the debtor would have been at risk of starvation.
Going beyond the Bible, Rabbinical teachings made the borrrower as guilty of the wrong as the creditor charging interest:
According to the Talmud, the debtor would be as guilty as the lender, since it interprets one of the biblical verbs referring to usury, namely tashshik, to be in the causative voice; due to the Talmud's figurative interpretation of the lifnei iver regulation, it even regards any witnesses to usury contracts, as well as the scribe writing the contract for the parties, to be as culpable for usury as the lender and debtor themselves.
But the Rabbinical lessons were that the creditor who does not charge interest could still sue for damages due to the delay for a payment:
However, the Mishnah does permit the refusal to hand over something for which only partial payment has been received, if it had been sold on the terms that payment would be made by a certain date, and if that date has passed; in English Law, the mortgage was invented to take advantage of this exception. If witnesses support a claim that it had been agreed to repay a debt by a certain date, but they are proven to be lying and the correct repayment date to be different, then, according to the Mishnah, the false witnesses must pay the amount accrued due to the difference in value of the thing between the two dates.
Debt & Slavery
First things first: when we say “slavery” and the Bible says “slavery,” we often mean very different things from the Bible concept. Our first thought of the word brings to mind the cruelties of the African Slave Trade. The atrocities of the 1600-1800s are an unthinkable stain on world history (and sadly, the Christians that supported it). Millions were caught up in the trading of men, women, and children into a life sentence of cruelty and forced labor.
The Bible does address this type of involuntary slavery in a prohibitionary way: “He who kidnaps a man, whether he sells him or he is found in his possession, shall surely be put to death.” (Ex. 21:16)
Plain and simple, anyone who stole another man/woman and sold them into slavery was to be put to death. This is the Biblical stance on chattel slavery.
Regrettably, Christians in this time period of history misused and distorted scripture to justify this type of slavery. Moving forward, we must recognize that the Bible’s use of the term “slavery” is often not what we think.
What is the Bible’s usage of the term?
The best comparison in our vocabulary is the concept of indentured servitude. This is the reason more modern translations of the Bible replace the word “slave” with “servant.”
Essentially, if a person was unable to pay their bills, then they must honor their debt by the sweat of their brow. This type of service had certain constraints on it in the Original Mosaic Testament Law, and—most importantly—the service was completed when the debt was repaid through labor. In light of this, we can begin to understand the famous (and sometimes infamous) proverb: “The borrower becomes the lender’s slave.” (Prov 22:7, NASB). This passage is literal. It simply means what it says. There is no metaphor hiding underneath Solomon’s words. He plainly states that the borrower will in fact become the lender’s slave in the event the debt cannot be paid off. Therefore, the Bible is describing a literal type of slavery (servant-hood, if you prefer) when debts could not be repaid.
What does this mean for me?
Aside from being a neat spiritual nugget to chirp out at our next Bible study, we must seek to apply this portion of God’s word to our life. What principle, if any, is to be found in this passage for the contemporary Christian? A simple answer is this: Debt will cause your productivity to belong to another. In biblical times, this was more of an all or nothing thing—slave or free. Today, however, the lines are a lot less clear. We fail to see that debt places our productivity into the hands of our creditors. Because this process is gradual, we lose sight of the fact that as debt increases, our ownership of our own productivity decreases. Our prosperity loses its potential to be invested in God’s kingdom as debt increases.
The further we trudge into debt, the more our efforts, income, and assets come under the ownership of our creditors. This could be everything from money going out in interest payments to garnished wages to liens on our possessions and properties. The more we leverage the more our resources belong to someone other than us. (I know God owns everything, but follow my argument here.) Bound by integrity and biblical instruction (Ps. 37:21), we must pay back what we have borrowed and thereby have little control or say as to where our money goes. Our influence over our money has disappeared. On the other hand, the further we get out of debt the more our freedom increases to invest in God’s kingdom. Our choices—to avoid debt or get into it—will have a remarkable effect on our freedom financially and beyond.
Finally, I want to share some wisdom from my father-in-law:
I found out that there are two ways to budget. I always thought that if I only could earn a little more and a little more, I would be able to save money. Then it finally dawned on me. What if I spend a little less. It would do the same thing. It took me a long time to learn that.
Advice on Credit Cards
See this link.
DID YOU KNOW THE LAW ON DEBT NEGATIVELY AFFECTED EVANGELISM TOWARD JEWS?
[I]n many European countries, medieval civil law also allowed the monarchs to automatically inherit any remaining income and property that had been acquired by usury, upon the death of the Jewish usurer involved. Medieval European monarchs thus supported the Jews, and suppressed any attempts to convert them to Christianity, since it would deprive the monarch of potential income; in England and France, the monarchs demanded compensation from the church for every Jew that was converted, and, until 1281, the English monarch had the legal right to claim half the property of any Jew that converted to Christianity. ("Loans and Interest in Judaism," Wikipedia.)
On National Economic Sins, including going into debt, see my book review of Duron Davis' Obama's Prophet -- an excellent and worthy fictional book to use with your childen or small Bible study groups.
To help with budgeting, try https://www.budgetsketch.com
To help on savings strategies, see Daily Finance.