Categories of Ribbit: Difference between revisions
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#Some explain that a key factor in determining if something is considered a loan is whether the item is fungible and normally traded; if it is always traded to be kept that is a sale. Another factor that is used is whether the type of item being lent is similar to the item that is being returned; if they’re dissimilar it is like a sale.<ref>Biurim in Chelkat Binyamin 161:1 s.v. dvar wrote that there’s a dispute between the Chavot Daat 161:1 and Mekor Mayim Chayim 161:1 why a loan of slaves isn’t a loan but a sale. Chavot Daat explains that since each slave is unique and needs a significant evaluation it is considered a sale when you trade one for two later. His premise is that there’s no prohibition of a loan of one item for another like apples for oranges. However, the Mekor Mayim Chaim explains that since a person doesn’t give a slave to be loaned out or traded (lhotzah) but rather to be used it isn’t considered or termed a loan but a sale.</ref> | #Some explain that a key factor in determining if something is considered a loan is whether the item is fungible and normally traded; if it is always traded to be kept that is a sale. Another factor that is used is whether the type of item being lent is similar to the item that is being returned; if they’re dissimilar it is like a sale.<ref>Biurim in Chelkat Binyamin 161:1 s.v. dvar wrote that there’s a dispute between the Chavot Daat 161:1 and Mekor Mayim Chayim 161:1 why a loan of slaves isn’t a loan but a sale. Chavot Daat explains that since each slave is unique and needs a significant evaluation it is considered a sale when you trade one for two later. His premise is that there’s no prohibition of a loan of one item for another like apples for oranges. However, the Mekor Mayim Chaim explains that since a person doesn’t give a slave to be loaned out or traded (lhotzah) but rather to be used it isn’t considered or termed a loan but a sale.</ref> | ||
===Judging by the Time of Stipulation=== | ===Judging by the Time of Stipulation=== | ||
# It is considered | # It is considered biblical ribbit to lend 100 items to get 120 items in return, even if at the time of the return those 120 items afterwards are the same price as the 100 items were at the time of the original loan.<ref>Gemara Bava Metsia 60b, Shulchan Aruch Y.D. 160:21</ref> | ||
# It is considered rabbinic ribbit to lend 100 items to get 100 items in return even if at the time of the return those 100 items are worth more than the price of the 100 items were originally.<ref> The reason that this is only rabbinic ribbit and not | # It is considered rabbinic ribbit to lend 100 items to get 100 items in return even if at the time of the return those 100 items are worth more than the price of the 100 items were originally.<ref> The reason that this is only rabbinic ribbit and not biblical ribbit is because we judge the situation whether something is ribbit or not based on the stipulation at the time of the loan. That is the ruling of the Shach YD 160:35 and Gra 160:53. This is also the opinion of the Ritva 61b s.v. vtisbara, Ran, and Talmid Harashba cited by Bet Yosef 160:21. However, the Hagahot Ashri 6:1 writes that this was the doubt of the gemara whether we judge the deal from the stipulation or the time of the return and if we judge it by the time of the return it is considered ribbit. This case might therefore be ribbit biblically. The Granat explains that even the Hagahot Ashri only considers it biblical ribbit if it is an exchange of currency which is uncommon but not with actual commodities which is certainly rabbinic. </ref> | ||
===Not Having Involvement with Interest=== | ===Not Having Involvement with Interest=== | ||
#Anyone involved in the interest transaction, such as the lender, buyer, witnesses, scribe, or another intermediary is violating the halacha of ribbit.<ref>Bava Metsia 75b, Tur and Shulchan Aruch Y.D. 160:1, Shach 160:1</ref> | #Anyone involved in the interest transaction, such as the lender, buyer, witnesses, scribe, or another intermediary is violating the halacha of ribbit.<ref>Bava Metsia 75b, Tur and Shulchan Aruch Y.D. 160:1, Shach 160:1</ref> | ||
==Conditional Interest== | ==Conditional Interest== | ||
# Interest that is only charged in the outcome of a certain specified condition is called ''sad echad bribbit'' (lit. one sided interest, Hebrew צד אחד ברבית). According to most poskim it is considered | # Interest that is only charged in the outcome of a certain specified condition is called ''sad echad bribbit'' (lit. one sided interest, Hebrew צד אחד ברבית). According to most poskim it is considered biblical interest.<ref>Taz 174:1. Bet Yosef 177:8 cites a teshuvat Rashba that sad echad bribbit is rabbinic and so returning taxes for the lender is only rabbinic. However, Tosfot b”m 63a defines sad echad bribbit to be something that depends on the decision of the borrower or lender. Rashba 63a s.v. sad agrees. Also, Netivot Moshe on Taz 177:16 asks that Bet Yosef 174:2 citing Rashba 67a and Teshuva Ktav Yad 85 holds that sad echad bribbit is biblical.</ref> | ||
==Rabbinic Prohibition of Interest== | ==Rabbinic Prohibition of Interest== | ||
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# If between the time of the loan and the time of the resale of the commodity to the lender the price of the commodity dropped to $90 then it is permitted to sell the commodity back to the lender.<ref>Taz 163:6</ref> | # If between the time of the loan and the time of the resale of the commodity to the lender the price of the commodity dropped to $90 then it is permitted to sell the commodity back to the lender.<ref>Taz 163:6</ref> | ||
# If the borrower never took the commodity but everything was transacted orally it is considered rabbinic interest in all circumstances.<ref>Shach 163:6</ref> | # If the borrower never took the commodity but everything was transacted orally it is considered rabbinic interest in all circumstances.<ref>Shach 163:6</ref> | ||
# If the borrower stipulated with the lender that they would go through with this entire series of transactions it is certainly interest.<ref>Rama 163:3. Rama implies it is | # If the borrower stipulated with the lender that they would go through with this entire series of transactions it is certainly interest.<ref>Rama 163:3. Rama implies it is biblical interest while the Bach cited by Shach 163:11 explains that it is only rabbinic interest.</ref> | ||
# There is a dispute if it is permitted if the borrower only sells the commodity back to the lender at another time.<ref>Taz 163:7 is lenient since it doesn't appear like interest but two separate transactions. Nekudat Hakesef 163:3 forbids. Chelkat Binyamin 164:27 additionally cites the Graz, Tiferet Lmoshe, and Avnei Nezer who are strict, unlike the Chachmat Adam who is lenient.</ref> | # There is a dispute if it is permitted if the borrower only sells the commodity back to the lender at another time.<ref>Taz 163:7 is lenient since it doesn't appear like interest but two separate transactions. Nekudat Hakesef 163:3 forbids. Chelkat Binyamin 164:27 additionally cites the Graz, Tiferet Lmoshe, and Avnei Nezer who are strict, unlike the Chachmat Adam who is lenient.</ref> | ||
====Renting a Field to a Borrower==== | ====Renting a Field to a Borrower==== | ||
# A person borrowed money and as a collateral gave the lender a field. Generally, the lender may not make use of that field without certain conditions. The lender then rents out the field to the borrower for a fixed rate. That is considered legal subterfuge to charge a borrower interest on his loan and is forbidden.<ref>Gemara Bava Metsia 68a, Shulchan Aruch Y.D. 164:1. Shach 164:1 explains that Shulchan Aruch holds like Rashi that doing so is | # A person borrowed money and as a collateral gave the lender a field. Generally, the lender may not make use of that field without certain conditions. The lender then rents out the field to the borrower for a fixed rate. That is considered legal subterfuge to charge a borrower interest on his loan and is forbidden.<ref>Gemara Bava Metsia 68a, Shulchan Aruch Y.D. 164:1. Shach 164:1 explains that Shulchan Aruch holds like Rashi that doing so is biblical interest.</ref> | ||
# If the entire series of transactions were stipulated from the beginning it is certainly forbidden.<Ref>Rama 164:1</ref> | # If the entire series of transactions were stipulated from the beginning it is certainly forbidden.<Ref>Rama 164:1</ref> | ||
# If the field as a collateral was used by the lender and for that use a deduction was made to the loan for each year until the entire loan would be paid off, then if there is someone else in between the borrower and lender it is permitted. That is, if the lender rents out the field to someone else and that person then lends it to the borrower it is permitted.<ref>Shulchan Aruch Y.D. 163:2, 172:2</ref> | # If the field as a collateral was used by the lender and for that use a deduction was made to the loan for each year until the entire loan would be paid off, then if there is someone else in between the borrower and lender it is permitted. That is, if the lender rents out the field to someone else and that person then lends it to the borrower it is permitted.<ref>Shulchan Aruch Y.D. 163:2, 172:2</ref> | ||
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# There is a dispute if money returned due to an erroneous sale is considered like a loan for the purposes of interest.<ref>Chatom Sofer YD 85 and Maharam Shik YD 161 dispute whether money that was taken because of a sale and then the sale falls through whether it is like a loan and it is permitted to pay interest or not. [https://www.hebrewbooks.org/pdfpager.aspx?req=1278&st=&pgnum=160&hilite= Maharshag 1:4] argues with the Maharam Shik.</ref> | # There is a dispute if money returned due to an erroneous sale is considered like a loan for the purposes of interest.<ref>Chatom Sofer YD 85 and Maharam Shik YD 161 dispute whether money that was taken because of a sale and then the sale falls through whether it is like a loan and it is permitted to pay interest or not. [https://www.hebrewbooks.org/pdfpager.aspx?req=1278&st=&pgnum=160&hilite= Maharshag 1:4] argues with the Maharam Shik.</ref> | ||
===Renting Coins=== | ===Renting Coins=== | ||
#It is forbidden to rent money to someone else because that is considered | #It is forbidden to rent money to someone else because that is considered biblical interest.<ref>Rama Y.D. 176:1</ref> | ||
##There is a minority opinion that one can rent out coins if they stipulate that the renter is exempt from all responsibility including damages from theft, loss, and unexpected circumstances. Ashkenazim rely upon this opinion for rabbinic interest, while Sephardim reject this opinion.<ref>Rama Y.D. 176:1 accepts the Trumat Hadeshen 302, while in 177:6 he only uses it for rabbinic interest. Shach there opines that the Trumat Hadeshen is even relevant to | ##There is a minority opinion that one can rent out coins if they stipulate that the renter is exempt from all responsibility including damages from theft, loss, and unexpected circumstances. Ashkenazim rely upon this opinion for rabbinic interest, while Sephardim reject this opinion.<ref>Rama Y.D. 176:1 accepts the Trumat Hadeshen 302, while in 177:6 he only uses it for rabbinic interest. Shach there opines that the Trumat Hadeshen is even relevant to biblical cases. Gra 176:2 completely rejects the Trumat Hadeshen. Bet Yosef 176:1 writes that the Trumat Hadeshen doesn’t actually allow it in practice.</ref> | ||
#If the person is planning on using the coins to show them off or to learn from them and isn’t going to be allowed to use them then It is permitted to rent them just like one can rent out any utensil.<ref>Tosefta, Tosfot Bava Metsia 69b, Shulchan Aruch Y.D. 176:1</ref> | #If the person is planning on using the coins to show them off or to learn from them and isn’t going to be allowed to use them then It is permitted to rent them just like one can rent out any utensil.<ref>Tosefta, Tosfot Bava Metsia 69b, Shulchan Aruch Y.D. 176:1</ref> | ||
## If one is renting coins for show or learning purposes the borrower can’t accept responsibility for the coins if there’s an unexpected circumstance in which the coins are damaged.<ref>Rama Y.D. 176:1</ref> | ## If one is renting coins for show or learning purposes the borrower can’t accept responsibility for the coins if there’s an unexpected circumstance in which the coins are damaged.<ref>Rama Y.D. 176:1</ref> | ||
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# It is permitted to rent utensils even if the renter has permission to sell them and replace them.<ref>Tur and Shulchan Aruch Y.D. 176:2</ref> However, one can’t do this with utensils that don’t depreciate with use such as gold or silver utensils.<Ref>Taz 176:1</ref> | # It is permitted to rent utensils even if the renter has permission to sell them and replace them.<ref>Tur and Shulchan Aruch Y.D. 176:2</ref> However, one can’t do this with utensils that don’t depreciate with use such as gold or silver utensils.<Ref>Taz 176:1</ref> | ||
# It is forbidden to rent out a car, ship, or pot such that they pay rent and if the item breaks the renter must pay for the value of the item at the time of the damage.<ref>Shulchan Aruch Y.D. 176:3</ref> This is only permitted for items that depreciate with use.<ref>Rama 176:3</ref> | # It is forbidden to rent out a car, ship, or pot such that they pay rent and if the item breaks the renter must pay for the value of the item at the time of the damage.<ref>Shulchan Aruch Y.D. 176:3</ref> This is only permitted for items that depreciate with use.<ref>Rama 176:3</ref> | ||
## According to Ashkenazim they may not stipulate that if it breaks then the renter should pay the value of the item when it was originally rented. According to Sephardim this is permitted.<ref>Shulchan Aruch and Rama 176:4. The Rambam Malveh Vloveh 8:13 holds that it is permitted to stipulate that the renter will pay the original value of the rented item if it breaks since if it is still around it can be returned as such even if it is worth less due to ware or market fluctuation. Bet Yosef 176:4 cites that the Rashba 69b, Ran 69b, and Mordechai b”m 5:330 agree with the Rambam. On the other hand, the Tur 176:4 holds that doing so is forbidden since the obligation of paying back the original value of the item indicates that it was like a loan and the rent was interest. Rabbenu Yerucham 1:27b agrees and thinks that it is only rabbinic interest, while Ramban b”m 70a s.v. ha damrinan is similarly strict but isn’t sure if it is rabbinic or | ## According to Ashkenazim they may not stipulate that if it breaks then the renter should pay the value of the item when it was originally rented. According to Sephardim this is permitted.<ref>Shulchan Aruch and Rama 176:4. The Rambam Malveh Vloveh 8:13 holds that it is permitted to stipulate that the renter will pay the original value of the rented item if it breaks since if it is still around it can be returned as such even if it is worth less due to ware or market fluctuation. Bet Yosef 176:4 cites that the Rashba 69b, Ran 69b, and Mordechai b”m 5:330 agree with the Rambam. On the other hand, the Tur 176:4 holds that doing so is forbidden since the obligation of paying back the original value of the item indicates that it was like a loan and the rent was interest. Rabbenu Yerucham 1:27b agrees and thinks that it is only rabbinic interest, while Ramban b”m 70a s.v. ha damrinan is similarly strict but isn’t sure if it is rabbinic or biblical interest.</ref> | ||
===Rentals of Real Estate=== | ===Rentals of Real Estate=== | ||
#It is permitted to stipulate two prices for rent, one for immediate payment and a higher rate for paying at the end. The reason is that since one is only obligated to pay rent at the end, paying at the beginning at a discount isn’t the real price and is permitted.<ref>Gemara Bava Metsia 65a, Tur and Shulchan Aruch Y.D. 176:6</ref> However, many hold that nowadays this leniency won’t apply since the practice in many places is to have the rent due from the beginning of the month or rental period. If so, it would be forbidden to have a two tiered system for the price of rent.<ref>Torat Ribbit 14:7 writes that if in a certain place it is assumed that rent is due at the beginning of the rental and not the end, the Chachmat Adam 136:10 forbids offering two prices for rent. His reason is that once the rent is due immediately it is considered a sale and offering a more expensive price later is forbidden. He also quotes that the Machaneh Efraim 31 writes that it is permitted since essentially it is due at the end but the practice is just to have a condition to pay it up front it is no different than in the days of the gemara. Torat Ribbit himself adds a leniency if it is clear that the price for the payment at the end is the fair market price and the earlier price is a discount that it could be permitted based on the Chachmat Adam 139:5.</ref> | #It is permitted to stipulate two prices for rent, one for immediate payment and a higher rate for paying at the end. The reason is that since one is only obligated to pay rent at the end, paying at the beginning at a discount isn’t the real price and is permitted.<ref>Gemara Bava Metsia 65a, Tur and Shulchan Aruch Y.D. 176:6</ref> However, many hold that nowadays this leniency won’t apply since the practice in many places is to have the rent due from the beginning of the month or rental period. If so, it would be forbidden to have a two tiered system for the price of rent.<ref>Torat Ribbit 14:7 writes that if in a certain place it is assumed that rent is due at the beginning of the rental and not the end, the Chachmat Adam 136:10 forbids offering two prices for rent. His reason is that once the rent is due immediately it is considered a sale and offering a more expensive price later is forbidden. He also quotes that the Machaneh Efraim 31 writes that it is permitted since essentially it is due at the end but the practice is just to have a condition to pay it up front it is no different than in the days of the gemara. Torat Ribbit himself adds a leniency if it is clear that the price for the payment at the end is the fair market price and the earlier price is a discount that it could be permitted based on the Chachmat Adam 139:5.</ref> | ||
# Even when or where it is permitted to charge extra for rent it is only permitted when stipulated in advance of the renter beginning to rent. It can not be stipulated once he already began his rental period<ref>Talmid Harashba 65a, Bet Yosef 176:6, Darkei Moshe 176:3, Rama 176:6. Bet Yosef has a doubt whether this constitutes | # Even when or where it is permitted to charge extra for rent it is only permitted when stipulated in advance of the renter beginning to rent. It can not be stipulated once he already began his rental period<ref>Talmid Harashba 65a, Bet Yosef 176:6, Darkei Moshe 176:3, Rama 176:6. Bet Yosef has a doubt whether this constitutes biblical or rabbinic interest.</ref> and certainly not after the rental period has finished.<ref>Shulchan Aruch Y.D. 176:6. Taz 176:8 ventures that this is biblical interest even according to the Bet Yosef since the obligation to pay after the rental period is halachically considered a loan. Shach in Nekudat Hakesef 176:3 disagrees and thinks that the Bet Yosef’s unresolved quandary is still relevant since the obligation was generated by a rental. Chelkat Binyamin 176:67 cites both the Shach and Taz. He adds that there’s an additional reason to assume it is rabbinic; according to the Rambam (cited in 166:2) all interest that isn’t obligated from the time of the loan is rabbinic.</ref> | ||
# When and where it is permitted to have a two tiered rent system it is even permitted when the renter makes this stipulation and payment significantly before he begins the rental.<ref>Bet Yosef 176:6 quotes the Hagahot Maimoniyot in the name of the Baalei Hatosfot Rashba says that it is forbidden to have a two tiered system when the renter doesn’t start immediately upon agreement of the rent. Doing so would appear as interest since it appears as though the payment is a loan in order for the owner to offer a discount. Yet, the Maggid Mishna cites the Rashba, Rav Shlomo Ben Aderet, as being lenient since the acquisition of the rental is complete once the rental price is finalized. That acquisition makes it a real rental and not a loan even from the moment of the agreement. Chelkat Binyamin (Tziyunim 176:167 and Biurim) clarifies that this means that the acquisition for the rental acquires him the house with respect to being able to live there when the rental will begin (unlike the Nekudat Hakesef 176:1 who implies that it means that it is completely in the possession of the renter immediately). Nekudat Hakesef 176:1 follows the Rashba, Rav Shlomo Ben Aderet.</ref> | # When and where it is permitted to have a two tiered rent system it is even permitted when the renter makes this stipulation and payment significantly before he begins the rental.<ref>Bet Yosef 176:6 quotes the Hagahot Maimoniyot in the name of the Baalei Hatosfot Rashba says that it is forbidden to have a two tiered system when the renter doesn’t start immediately upon agreement of the rent. Doing so would appear as interest since it appears as though the payment is a loan in order for the owner to offer a discount. Yet, the Maggid Mishna cites the Rashba, Rav Shlomo Ben Aderet, as being lenient since the acquisition of the rental is complete once the rental price is finalized. That acquisition makes it a real rental and not a loan even from the moment of the agreement. Chelkat Binyamin (Tziyunim 176:167 and Biurim) clarifies that this means that the acquisition for the rental acquires him the house with respect to being able to live there when the rental will begin (unlike the Nekudat Hakesef 176:1 who implies that it means that it is completely in the possession of the renter immediately). Nekudat Hakesef 176:1 follows the Rashba, Rav Shlomo Ben Aderet.</ref> | ||
# If a person is renting a field for work for a certain price and also offers the renter a loan in order to invest in the field itself, they can arrange that the rental price will be higher because of this loan.<ref>Gemara Bava Metzia 69b, Tur and Shulchan Aruch Y.D. 176:5. Baal Hatrumot 46:4:48 cited by Bet Yosef 176:5 quotes Rabbenu Moshe who says that it is forbidden to have the renter pay back the loan as well as the higher rent. Rather he should pay for the higher rent and not the capital of the loan. Bet Yosef comments that this Rabbenu Moshe isn’t the Rambam who makes no mention of this qualification. Indeed, the Chelkat Binyamin (176 fnt. 134) notes that the Shulchan Aruch and commentaries don’t make this qualification either and as such we don’t follow it.</ref> This is only permitted even after the rental begins before the rental is due.<ref>Chelkat Binyamin 176:44</ref> | # If a person is renting a field for work for a certain price and also offers the renter a loan in order to invest in the field itself, they can arrange that the rental price will be higher because of this loan.<ref>Gemara Bava Metzia 69b, Tur and Shulchan Aruch Y.D. 176:5. Baal Hatrumot 46:4:48 cited by Bet Yosef 176:5 quotes Rabbenu Moshe who says that it is forbidden to have the renter pay back the loan as well as the higher rent. Rather he should pay for the higher rent and not the capital of the loan. Bet Yosef comments that this Rabbenu Moshe isn’t the Rambam who makes no mention of this qualification. Indeed, the Chelkat Binyamin (176 fnt. 134) notes that the Shulchan Aruch and commentaries don’t make this qualification either and as such we don’t follow it.</ref> This is only permitted even after the rental begins before the rental is due.<ref>Chelkat Binyamin 176:44</ref> | ||
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==Circumstances That Might Permit Interest== | ==Circumstances That Might Permit Interest== | ||
===Land or Documents=== | ===Land or Documents=== | ||
# Ribbit applies to lending land in order to receive more in return or the same land together with something else in return. This is considered | # Ribbit applies to lending land in order to receive more in return or the same land together with something else in return. This is considered biblical ribbit.<Ref>Tosfot Bava Metsia 61a s.v. im holds that based on a klal uprat uklal land is excluded from the laws of ribbit. Rosh b”m 5:1 and Ran b”m 61a s.v. karkaot agrees. Tur 161:1 cites Ri who agrees. Bet Yosef cites the Rabbenu Yerucham who is strict. The Rabbenu Yerucham 1:8 is citing the Rashba b”m 61a minayin, however, in our versions of the Rashba it seems in conclusion he is lenient. The Bet Yosef isn’t certain if there’s a rabbinic prohibition even according to Tosfot. Taz 161:1 says obviously there is a rabbinic prohibition. Certainly Tosfot adds that money to receive some land or benefit from land is forbidden. The Shach 161:1 and Taz 161:1 who point out that Shulchan Aruch 161:1 seems to be strict. See Gra 161:1 who might be lenient to consider it only a rabbinic prohibition. </ref> | ||
# Ribbit applies to money given in a document.<ref>Rosh Bava Metsia 5:1 writes that theoretically documents should be excluded from ribbit because of a klal uprat. However, he notes that there’s no case of a loan with a document, giving a loan to receive it return with an interest on the side is a rental. Bet Yosef 161:1 asks why it isn’t considered a loan to give a document of debt that is worth 100 to receive in return a document of debt of 200. Bach 161:1 and Taz 161:1 both argue that such a deal would certainly be ribbit since the document merely represents money.</ref> | # Ribbit applies to money given in a document.<ref>Rosh Bava Metsia 5:1 writes that theoretically documents should be excluded from ribbit because of a klal uprat. However, he notes that there’s no case of a loan with a document, giving a loan to receive it return with an interest on the side is a rental. Bet Yosef 161:1 asks why it isn’t considered a loan to give a document of debt that is worth 100 to receive in return a document of debt of 200. Bach 161:1 and Taz 161:1 both argue that such a deal would certainly be ribbit since the document merely represents money.</ref> | ||
