loaning money with interest / usury
Harper’s Bible Dictionary
edited by Paul J. Achtemier (San Francisco: Harper and Row, 1985)
You are strongly recommended to add to your library the excellent revised edition of Harper's Bible Dictionary titled, The Harper Collins Bible Dictionary, Revised Edition [book review], edited by Paul J. Achtemeier, with the Society of Biblical Literature (NY: Harper Collins, 1996). It is currently the best one-volume Bible dictionary in English, and it is available at Border's Books, Christian Science Reading Rooms, http://www.borders.com, or http://www.christianbook.com.
loan, something lent or furnished on condition of being returned. Biblical legislation concerning the lending of fungibles must be understood against the background of a noncommercial agricultural society with strong tribal roots. The primary motivation of borrowers was to obtain relief from need rather than to further their economic enterprises. Furthermore, the poor and needy were deemed fellow kin of all Israelites (Deut. 15:11). Hence, biblical law considers the lending of fungibles to be a philanthropic act and thus restricts severely the rights of the lender or creditor.
Interest: According to the Mesopotamian law codes and private contracts to which OT law may be compared, Mesopotamian creditors commonly charged an annual interest rate of 20 percent for loans of silver and 33-1/3 percent for loans of grain. Biblical law, however, prohibits creditors from exercising this right over their needy brethren (Exod. 22:24; Lev. 25:35-37; Deut. 23:20), although it does allow the taking of interest from non-Israelites (Deut. 23:21). The nonlegal biblical references depicting the difficult plight of debtors in ancient Israel (e.g., 1 Sam. 22:2; Jer. 15:10) would seem to attest to the violation of this prohibition. Ezekiel brands creditors who take interest as wicked, while praising those who refrain as pious (Ezek. 18:8, 13, 17; 22:12; cf. Ps. 15:5). The wisdom literature further cautions that wealth augmented by interest is fleeting (Prov. 28:8). According to the NT, as inferred from the parable of the talents, it is proper to invest ones money with bankers for the sake of receiving interest (Luke 19:23; Matt. 25:27).
The two terms for interest in biblical Hebrew are neshek (derived from the verb to bite) and tarbith (lit., increase), which are translated in the rsv as interest. Scholars differ in their understanding of the two Hebrew terms. Some view the terms as a fixed pair denoting a single concept. Others attempt to distinguish them as referring to two different types of interest: advanced interest, which is bitten off the principal at the onset of the loan, and accrued interest resulting in an increase at the time of repaying the loan.
Pledges and Surety: Ancient Near Eastern law acknowledged as means of protecting the lender against loss due to default of payment both the pledge whereby chattel, real estate, or persons were surrendered as security for a loan and the surety whereby a person assumed liability for the obligation of the borrower. Limited knowledge of ancient Near Eastern pledge law, however, does not allow for clear differentiation between pledge and mortgage found in modern law. Today a mortgage is defined as a conditional conveyance of property bestowing legal title upon the mortgagee who need not have physical possession of the property. In contrast, a pledge is a bailment of property to be in the physical possession of the pledgee who does not have legal title to the property. Thus, upon default, the mortgaged property passes wholly to the mortgagee while the pledged property must be sold and only as much of the proceeds as will satisfy the debt passes to the pledgee. Similarly, limited knowledge of ancient Near Eastern suretyship does not always allow clear definition as to whether the surety becomes a co-debtor or whether he only ensures the presence of the defaulting debtor for personal prosecution by the creditor.
Biblical law recognizes the right of lenders to take a pledge. However, the law places the following restrictions upon creditors: they may not enter the debtors home to seize a pledge but must wait outside (Deut. 24:10-11); they may not seize what is needed for ones daily living (Deut. 24:6; cf. Job 24:3); they may not seize the garment of a widow (Deut. 24:17); and the pledged garment of the poor must be returned by nightfall (Deut. 24:12-13; Exod. 22:25-26; cf. Amos 2:8). The nonlegal literature of the Bible attests to the seizing of members of the defaulting debtors family and to the taking of real estate to secure and satisfy a loan (2 Kings 4:1; Isa. 50:1; Neh. 5:3-5; Matt. 18:25).
Laws governing surety do not occur in the corpus of biblical law. References to the institution, however, are found in the nonlegal literature of the Bible, especially in the wisdom literature. The book of Proverbs is replete with advice against standing surety for another (6:1; 11:15; 17:18; 22:26-27; 27:13). The references reveal that the assumption of surety was accompanied by the symbolic gesture of giving ones hand perhaps as a type of handshake (Prov. 6:1; 17:18; Job 17:3). Judahs assumption of surety for Benjamin (Gen. 44:32) seems to indicate that at times a surety would only ensure the physical presence of the debtor for personal prosecution by the creditor, while Prov. 22:26-27 clearly indicates that a surety often became a co-debtor. The concept of surety is used also metaphorically in prayer (Isa. 38:14; Ps. 119:122; Job 17:3; cf. Heb. 7:22).
Remission of Debt: Mesopotamian kings are known to have issued edicts designed to restore some measure of equilibrium in the economic life of the society. These edicts entailed cancellation of certain types of debts, release from certain kinds of tenant obligations, and freedom from debt servitude. Biblical law instituted a cyclical cancellation of debts by decreeing the remission of all outstanding loans in the Sabbatical (i.e., seventh) Year (Deut. 15:1-11).
Edited for BibleTexts.com by Robert Nguyen Cramer