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Interest with Non-Jews: Difference between revisions
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→When the Deposit was Given to the Non-Jew Properly
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#Some permit borrowing from a non-Jew with a collateral so that they can in turn borrow with interest from another Jew with that collateral. This is permitted since the non-Jew takes responsibility for the original loan and it is treated as two loans and not one. Ashkenazim can rely on this opinion.<ref>Ri cited by Rosh b"m 5:55, Rosh responsa 108:11, Rama 168:8 seems to support this approach. Darkei Moshe 168:4 quotes the Mordechai and Hagahot Ashri who held that it is permitted even initially. Darkei Moshe 168:9 cites the Kol Bo 84 and Hagahot Maimoniyot Malveh 5:3 who says that the minhag was like the Ri</ref> Others hold that generally this is forbidden to arrange but if one explicitly tells the non-Jew that he has responsibility for the loan then it is permitted.<ref>Ramban b"m 71b s.v. vbar cited by Tur 168:9, Rashba 7:321, Nemukei Yosef 42a, Talmidei Harashba, and Baal Hatrumot 46:4:10 s.v. vkatav alav haramban cited by Bet Yosef 168:9</ref> The Jewish borrower must make sure that the collateral that he gave to the non-Jew was given completely such that the non-Jew could acquire it with a proper [[kinyan]].<ref>Shach 168:20 writes that one needs to make sure that the non-Jew acquired the collateral with a kinyan such as meshicha, pulling it. Chelkat Binyamin 168:63 and 65 explains that there's two approaches for the case of a Jew who borrowed from a non-Jew who in turn borrows from a Jew when there's a collateral. The Gra and Levush say that the collateral doesn't add or detract anything, it all depends on whether the non-Jew was an agent of the original Jew in which case it is forbidden and if not it is permitted. The Shach, Taz, and Chavot Daat 168:12 however, hold that the collateral of the Jew can serve as a Arev Kablan, guarantor for the non-Jew from the original Jew and that is a problem. Another words, since the original Jew's property is held responsible for the interest loan of a non-Jew to the second Jew, it is as though the original Jew is the guarantor of that interest loan. In Shulchan Aruch Y.D. 170:2 it is codified that a Jew may not be a guarantor of a non-Jew's interest loan from a Jew. Therefore, the way to solve that issue is by having the original Jew completely allow the non-Jew to acquire the collateral and his transactions with it afterwards are separate from him. (See Talmidei Harashba cited by Bet Yosef 168:9 who is unconcerned for the collateral being a guarantor since it is considered a Arev Stam.)</ref> | #Some permit borrowing from a non-Jew with a collateral so that they can in turn borrow with interest from another Jew with that collateral. This is permitted since the non-Jew takes responsibility for the original loan and it is treated as two loans and not one. Ashkenazim can rely on this opinion.<ref>Ri cited by Rosh b"m 5:55, Rosh responsa 108:11, Rama 168:8 seems to support this approach. Darkei Moshe 168:4 quotes the Mordechai and Hagahot Ashri who held that it is permitted even initially. Darkei Moshe 168:9 cites the Kol Bo 84 and Hagahot Maimoniyot Malveh 5:3 who says that the minhag was like the Ri</ref> Others hold that generally this is forbidden to arrange but if one explicitly tells the non-Jew that he has responsibility for the loan then it is permitted.<ref>Ramban b"m 71b s.v. vbar cited by Tur 168:9, Rashba 7:321, Nemukei Yosef 42a, Talmidei Harashba, and Baal Hatrumot 46:4:10 s.v. vkatav alav haramban cited by Bet Yosef 168:9</ref> The Jewish borrower must make sure that the collateral that he gave to the non-Jew was given completely such that the non-Jew could acquire it with a proper [[kinyan]].<ref>Shach 168:20 writes that one needs to make sure that the non-Jew acquired the collateral with a kinyan such as meshicha, pulling it. Chelkat Binyamin 168:63 and 65 explains that there's two approaches for the case of a Jew who borrowed from a non-Jew who in turn borrows from a Jew when there's a collateral. The Gra and Levush say that the collateral doesn't add or detract anything, it all depends on whether the non-Jew was an agent of the original Jew in which case it is forbidden and if not it is permitted. The Shach, Taz, and Chavot Daat 168:12 however, hold that the collateral of the Jew can serve as a Arev Kablan, guarantor for the non-Jew from the original Jew and that is a problem. Another words, since the original Jew's property is held responsible for the interest loan of a non-Jew to the second Jew, it is as though the original Jew is the guarantor of that interest loan. In Shulchan Aruch Y.D. 170:2 it is codified that a Jew may not be a guarantor of a non-Jew's interest loan from a Jew. Therefore, the way to solve that issue is by having the original Jew completely allow the non-Jew to acquire the collateral and his transactions with it afterwards are separate from him. (See Talmidei Harashba cited by Bet Yosef 168:9 who is unconcerned for the collateral being a guarantor since it is considered a Arev Stam.)</ref> | ||
## When the non-Jew who lent to a Jew and now comes to borrow from the Jew should borrow in his own name. If he borrows in the name of the first Jew that is certainly interest and is forbidden.<ref>Chelkat Binyamin 168:65 and 53 based on Shach 168:34, Chavot Daat 168:10, and Shulchan Aruch Y.D. 168:21. In the rishonim this can be substantiated by Rosh 108:11 and Nemukei Yosef 42a. </ref> | ## When the non-Jew who lent to a Jew and now comes to borrow from the Jew should borrow in his own name. If he borrows in the name of the first Jew that is certainly interest and is forbidden.<ref>Chelkat Binyamin 168:65 and 53 based on Shach 168:34, Chavot Daat 168:10, and Shulchan Aruch Y.D. 168:21. In the rishonim this can be substantiated by Rosh 108:11 and Nemukei Yosef 42a. </ref> | ||
#Even according to the strict opinion, a lender to a non-Jew with interest who collected a deposit from him which came originally from a Jew can collect the interest as long as he isn't certain that it was arranged improperly.<ref>Ri, Rosh, Shulchan Aruch 168:9. Chelkat Binyamin 168:63 explains that essentially there's two schools of thought regarding a loan with a | #Even according to the strict opinion, a lender to a non-Jew with interest who collected a deposit from him which came originally from a Jew can collect the interest as long as he isn't certain that it was arranged improperly.<ref>Ri, Rosh, Shulchan Aruch 168:9. Chelkat Binyamin 168:63 explains that essentially there's two schools of thought regarding a loan with a collateral from one Jew to another Jew with a non-Jew in between. The Gra and Levush understand that this depends on whether one may set up a non-Jew agent between two Jews who are transacting with interest. The Shach, Taz 168:14, and Chavot Daat 168:12, on the other hand, think that the collateral poses its own problem in that it functionally creates a lien of the Jewish lender upon the original borrower Jew. This could be solved if the non-Jew acquired the collateral from the non-Jew in an absolute fashion.</ref> Some say that he may not collect the interest if he knew that it was a Jewish collateral such as if it is a Jewish article of clothing.<ref>Tur 189:9, Shulchan Aruch 168:9. Bet Yosef 168:9 s.v. yisrael shnatan notes that the Mordechai 338 held within the opinion of Rabbenu Tam that it doesn't matter whether the deposit was clearly Jewish or not.</ref> | ||
#If the original Jew wants to get his collateral back from the other Jew who lent to the non-Jew and the non-Jew isn't cooperating, the lender Jew doesn't need to work with the borrower Jew since they didn't have any transaction one to another.<ref>Rosh responsa 108:8, Rama 168:9</ref> | #If the original Jew wants to get his collateral back from the other Jew who lent to the non-Jew and the non-Jew isn't cooperating, the lender Jew doesn't need to work with the borrower Jew since they didn't have any transaction one to another.<ref>Rosh responsa 108:8, Rama 168:9</ref> | ||
#If a Jew has a collateral of a non-Jew in his hands and the non-Jew directs him to use it to borrow from another Jew with interest on his behalf, the first Jew may do so.<ref>Mordechai 337 writes that a Jew can use a non-Jew's | #If a Jew has a collateral of a non-Jew in his hands and the non-Jew directs him to use it to borrow from another Jew with interest on his behalf, the first Jew may do so.<ref>Mordechai 337 writes that a Jew can use a non-Jew's collateral to borrow from a Jew with interest if he is instructed so by the non-Jew. The Mordechai seems to apply this even to the case where the Jew didn't have the non-Jew's collateral but instead wanted to gift him a collateral of his own for its value. The Bet Yosef is troubled by this leniency since there's no mechanism by which the non-Jew is actually acquiring the collateral. Taz 168:14 gives a nuanced explanation that it was sold to the second Jew with a condition that the non-Jew could buy it back. Bach 168:13 and Nekudat Hakesef 168:11 explain that once a owner admits to the fact someone else owns his item it halachically belongs to that person (''kinyan odita'') and that is sufficient to remove the prohibition of ribbit. Either way, the Rama 169:11 concludes that we assume that it is impossible to gift a collateral to a non-Jew without him making a physical [[kinyan]] such as meshicha.</ref> | ||
#If a Jew lent from another Jew and got a collateral for that loan, and specified that if the Jew didn’t pay up on time he would either sell the collateral or borrow against it with interest. If he then borrowed against it with interest from a non-Jew, he isn’t responsible to pay the interest for the loan since that was the stipulation. Instead the Jewish borrower needs to pay the interest in order to redeem his collateral.<ref>Rashba responsa cited by Bet Yosef 168:26 explains that once they stipulated that the lender Jew can borrow with interest against the collateral we understand that to mean that the lender Jew isn’t borrowing from the non-Jew for himself, rather he is doing so as an agent of the other Jew. Therefore, the borrower Jew can repay the interest to the non-Jew and it isn’t interest to the lender Jew since he is neither a lender or a guarantor of the loan, he is simply the agent. Shaar Mishpat 168:13 cites this Rashba but also cites the Maharit YD 46 based on the Maharam who argues that it is an asmachta and isn't binding. Therefore, the lender couldn't lend to the non-Jew with interest on that collateral. Shulchan Gavoha 168:50 cites this Rashba and fundamentally puts it in the same camp as the Rosh which is codified by Shulchan Aruch 168:26. Kovetz Halichot Horah Ribbit v. 5 p. 316-7 explains that it is necessary for the Rashba and Ramban 71a that the lender Jew be the agent of the original borrower as well as the fact that the non-Jew is collecting from the collateral. The reason is that if it was simply that the non-Jew would collect from the collateral but the Jewish lender was never appointed as an agent then he is in essence borrowing for himself with interest and having another Jew repay his interest using his collateral.</ref> | #If a Jew lent from another Jew and got a collateral for that loan, and specified that if the Jew didn’t pay up on time he would either sell the collateral or borrow against it with interest. If he then borrowed against it with interest from a non-Jew, he isn’t responsible to pay the interest for the loan since that was the stipulation. Instead the Jewish borrower needs to pay the interest in order to redeem his collateral.<ref>Rashba responsa cited by Bet Yosef 168:26 explains that once they stipulated that the lender Jew can borrow with interest against the collateral we understand that to mean that the lender Jew isn’t borrowing from the non-Jew for himself, rather he is doing so as an agent of the other Jew. Therefore, the borrower Jew can repay the interest to the non-Jew and it isn’t interest to the lender Jew since he is neither a lender or a guarantor of the loan, he is simply the agent. Shaar Mishpat 168:13 cites this Rashba but also cites the Maharit YD 46 based on the Maharam who argues that it is an asmachta and isn't binding. Therefore, the lender couldn't lend to the non-Jew with interest on that collateral. Shulchan Gavoha 168:50 cites this Rashba and fundamentally puts it in the same camp as the Rosh which is codified by Shulchan Aruch 168:26. Kovetz Halichot Horah Ribbit v. 5 p. 316-7 explains that it is necessary for the Rashba and Ramban 71a that the lender Jew be the agent of the original borrower as well as the fact that the non-Jew is collecting from the collateral. The reason is that if it was simply that the non-Jew would collect from the collateral but the Jewish lender was never appointed as an agent then he is in essence borrowing for himself with interest and having another Jew repay his interest using his collateral.</ref> | ||
#If a Jew lent from another Jew and got a collateral for that loan, he can then use that collateral to borrow with interest from a non-Jew. He should specify to the non-Jew that he is borrowing on behalf of another Jew and he has no responsibility. Alternatively, if the collateral is worth the entire value of the loan he can use it to borrow from the non-Jew with interest. Then the original borrower Jew can pay the non-Jew the interest and redeem his collateral. The Jewish lender was simply the agent of the first Jew to borrow with interest from a non-Jew.<ref>Tashbetz Katan 486 writes that if the Jewish lender specifies to the non-Jew that he is borrowing on behalf of another Jew it is permitted, otherwise it is like he is borrowing for himself and having the original borrower Jew pay the interest is forbidden. Yet, the Bet Yosef 168:26 points out that the Rosh implies that it is permitted for the original borrower to pay the interest even if the lender Jew didn’t make that stipulation. Shulchan Aruch 168:26 simply quotes the case without specifically mentioning that stipulation. Shach 168:82 explains that the Tashbetz Katan and Rosh agree. Either a stipulation is necessary or having a collateral that is worth the entire value of the loan and interest. Otherwise it is forbidden. Chelkat Binyamin 168:291 agrees. Mayin Ganim Abadi YD 9 shows at length that the Bet Yosef thought that there is a dispute between the Tashbetz Katan and Rosh. The Rosh thinks that even without specifying it is assumed that the non-Jew depends on the collateral and there’s no responsibility upon the Jew. However, the Tashbetz Katan thinks that only if the Jew specifies that is it so, otherwise we assume that the non-Jew will hold responsible the Jew who is borrowing from him as well as from the collateral, in which case it would be forbidden for the original borrower to pay the interest. Erech Lechem 168:17 implies this as well. He explains that the Ran cited in Shulchan Aruch 168:17 implies like the Tashbetz Katan, yet, Shulchan Aruch ultimately sided with the Rosh and Rashba unlike the Tashbetz Katan and Ran.</ref> | #If a Jew lent from another Jew and got a collateral for that loan, he can then use that collateral to borrow with interest from a non-Jew. He should specify to the non-Jew that he is borrowing on behalf of another Jew and he has no responsibility. Alternatively, if the collateral is worth the entire value of the loan he can use it to borrow from the non-Jew with interest. Then the original borrower Jew can pay the non-Jew the interest and redeem his collateral. The Jewish lender was simply the agent of the first Jew to borrow with interest from a non-Jew.<ref>Tashbetz Katan 486 writes that if the Jewish lender specifies to the non-Jew that he is borrowing on behalf of another Jew it is permitted, otherwise it is like he is borrowing for himself and having the original borrower Jew pay the interest is forbidden. Yet, the Bet Yosef 168:26 points out that the Rosh implies that it is permitted for the original borrower to pay the interest even if the lender Jew didn’t make that stipulation. Shulchan Aruch 168:26 simply quotes the case without specifically mentioning that stipulation. Shach 168:82 explains that the Tashbetz Katan and Rosh agree. Either a stipulation is necessary or having a collateral that is worth the entire value of the loan and interest. Otherwise it is forbidden. Chelkat Binyamin 168:291 agrees. Mayin Ganim Abadi YD 9 shows at length that the Bet Yosef thought that there is a dispute between the Tashbetz Katan and Rosh. The Rosh thinks that even without specifying it is assumed that the non-Jew depends on the collateral and there’s no responsibility upon the Jew. However, the Tashbetz Katan thinks that only if the Jew specifies that is it so, otherwise we assume that the non-Jew will hold responsible the Jew who is borrowing from him as well as from the collateral, in which case it would be forbidden for the original borrower to pay the interest. Erech Lechem 168:17 implies this as well. He explains that the Ran cited in Shulchan Aruch 168:17 implies like the Tashbetz Katan, yet, Shulchan Aruch ultimately sided with the Rosh and Rashba unlike the Tashbetz Katan and Ran.</ref> | ||
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===Jew Selling Non-Jew's Debt=== | ===Jew Selling Non-Jew's Debt=== | ||
#If a Jew lent money to a non-Jew with interest, he can then sell that loan to another Jew. He should stipulate that this is a complete sale of the loan and they will no longer have any claims upon each other. Thereby, the buyer becomes the new lender to the non-Jew and can collect interest.<ref>Shulchan Aruch 168:18. When there is no | #If a Jew lent money to a non-Jew with interest, he can then sell that loan to another Jew. He should stipulate that this is a complete sale of the loan and they will no longer have any claims upon each other. Thereby, the buyer becomes the new lender to the non-Jew and can collect interest.<ref>Shulchan Aruch Y.D. 168:18. When there is no collateral, the Shach 168:62 explains that the mechanism isn't exactly a sale since one can't really sell the debt to another Jew. Rather one is forgiving the non-Jew from paying him back. Then the non-Jew can pay the second Jew as he is "considered" according to their intention to be the new lender. In Shach 168:63 he clarifies that he doesn't need to inform the non-Jew of that which he forgave. Netivot Shalom 168:18:9 explains that even though the non-Jew will be paying the second Jew in error he can collect it. Shach 168:63 is in disagreement with the Bach who thinks that it is necessary to alert the non-Jew. See Chavot Daat 168:41 who endorses another approach; he explains that this transaction is a sale with respect to non-Jews and purely forgiving a loan with respect to Jews. Therefore, he concludes that the first Jew may not go and reacquire the loan from the non-Jew that he forgave. However, it seems Chelkat Binyamin p. 313 would challenge this from C.M. 66:25.</ref> However, for this to be effective a binding ''kinyan'' (acquisition) is necessary to transfer the non-Jew's debt to the Jewish purchaser. | ||
##This sale can be effectuated by a mechanism that local businessman accept as a binding acquisition and is enforceable by secular law.<ref>Laws of Ribbis p. 255 writes that one may rely on the opinion of Ben Ish Chai (V'etchanan 23) that a non-Jew's debt can be sold with a ''kinyan situmta''. </ref> | ##This sale can be effectuated by a mechanism that local businessman accept as a binding acquisition and is enforceable by secular law.<ref>Laws of Ribbis p. 255 writes that one may rely on the opinion of Ben Ish Chai (V'etchanan 23) that a non-Jew's debt can be sold with a ''kinyan situmta''. </ref> | ||
##When there is a moveable collateral from the non-Jew that would have to be transferred to the second Jew with the stipulation that it is a complete sale and they have no claims upon each other.<ref>Shulchan Aruch Y.D. 168:18</ref> The purchasing Jew can make a kinyan on the collateral by taking the actual collateral item.<ref>Rama 168:18</ref> If the Jewish purchaser pays money to buy the collateral but does not actually take the collateral whether he acquired the collateral for purposes of collecting interest is subject to debate.<ref>Bet Yosef and Rama 168:18 hold that it is acceptable to use kinyan kesef to purchase the mashkon of a goy from another Jew since from the Torah a kinyan kesef is effective. However, Gra 168:62 disagrees with this suggestion. He holds that fundamentally the rabbis invalidated the acquisition of kinyan kesef (Tosfot Avoda Zara 63a s.v. vha). Also, even if it is a kinyan on a Torah level and not midrabbanan it would be forbidden to use this kinyan to collect interest as the rabbis introduced stringencies in the world of interest and not leniencies. </ref> | ##When there is a moveable collateral from the non-Jew that would have to be transferred to the second Jew with the stipulation that it is a complete sale and they have no claims upon each other.<ref>Shulchan Aruch Y.D. 168:18</ref> The purchasing Jew can make a kinyan on the collateral by taking the actual collateral item.<ref>Rama 168:18</ref> If the Jewish purchaser pays money to buy the collateral but does not actually take the collateral whether he acquired the collateral for purposes of collecting interest is subject to debate.<ref>Bet Yosef and Rama 168:18 hold that it is acceptable to use kinyan kesef to purchase the mashkon of a goy from another Jew since from the Torah a kinyan kesef is effective. However, Gra 168:62 disagrees with this suggestion. He holds that fundamentally the rabbis invalidated the acquisition of kinyan kesef (Tosfot Avoda Zara 63a s.v. vha). Also, even if it is a kinyan on a Torah level and not midrabbanan it would be forbidden to use this kinyan to collect interest as the rabbis introduced stringencies in the world of interest and not leniencies. </ref> | ||
