Guaranteed Low Prices and Interest: Difference between revisions
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→Buying on Credit
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===Buying on Credit=== | ===Buying on Credit=== | ||
#Generally it is forbidden<ref>Rambam Malveh Vloveh 8:1 clarifies that it is only rabbinically forbidden to charge more for buying on credit since it is presented as a sale not a loan. Shach 173:4 agrees.</ref> to charge someone extra for buying on credit.<ref>Gemara Bava Metsia 65a, Shulchan Aruch Y.D. 173:1</ref> | #Generally it is forbidden<ref>Rambam Malveh Vloveh 8:1 clarifies that it is only rabbinically forbidden to charge more for buying on credit since it is presented as a sale not a loan. Shach 173:4 agrees.</ref> to charge someone extra for buying on credit.<ref>Gemara Bava Metsia 65a, Shulchan Aruch Y.D. 173:1</ref> | ||
====Undetermined Price (Tarsha)==== | |||
# If an item doesn't have a fixed price then one can charge more for it when the buyer pays later than the delivery date. The reason is that since there's no established price the seller can set the price of the item at the higher price that the buyer will pay later. However, if there is a market price that is known<ref>Tosfot b"m 63b, Rosh b"m 5:22</ref> or the seller specifies a price for the item if one wanted to pay now and another price for buying on credit it is forbidden.<ref>Gemara Bava Metsia 65a</ref> Therefore, having a two tiered pricing system for buying regularly and buying on credit is interest and forbidden between two Jews.<ref>Shulchan Aruch Y.D. 173:1</ref> | # If an item doesn't have a fixed price then one can charge more for it when the buyer pays later than the delivery date. The reason is that since there's no established price the seller can set the price of the item at the higher price that the buyer will pay later. However, if there is a market price that is known<ref>Tosfot b"m 63b, Rosh b"m 5:22</ref> or the seller specifies a price for the item if one wanted to pay now and another price for buying on credit it is forbidden.<ref>Gemara Bava Metsia 65a</ref> Therefore, having a two tiered pricing system for buying regularly and buying on credit is interest and forbidden between two Jews.<ref>Shulchan Aruch Y.D. 173:1</ref> | ||
#Even when there's no clear price, the market hasn't established a price, and the seller didn't specify a price, the seller can only increase the price a little. There is a dispute as to this amount: | #Even when there's no clear price, the market hasn't established a price, and the seller didn't specify a price, the seller can only increase the price a little. There is a dispute as to this amount: | ||
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## Some say that the seller can raise it up to 20 percent above the range of prices in the market. If this is a stringency we follow this opinion.<ref>Chelkat Binyamin 173:28</ref> | ## Some say that the seller can raise it up to 20 percent above the range of prices in the market. If this is a stringency we follow this opinion.<ref>Chelkat Binyamin 173:28</ref> | ||
# If something doesn't have a clear price and the market price fluctuates frequently even if there is currently a market price it is considered eligible for the leniency of charging more for buying on credit as long as the seller doesn't specify a price for purchasing it up front.<ref>Chavot Daat 173:3, Chelkat Binyamin 173:31</ref> | # If something doesn't have a clear price and the market price fluctuates frequently even if there is currently a market price it is considered eligible for the leniency of charging more for buying on credit as long as the seller doesn't specify a price for purchasing it up front.<ref>Chavot Daat 173:3, Chelkat Binyamin 173:31</ref> | ||
# If the price isn't clear and sometimes is sold for one price when sold in the market and another price when sold at a private home, it is permitted to charge a higher price when selling it at the private home even if the buyer is buying on credit.<ref>Shulchan Aruch Y.D. 173:2</ref> | # If the price isn't clear and sometimes is sold for one price when sold in the market and another price when sold at a private home, it is permitted to charge a higher price when selling it at the private home even if the buyer is buying on credit.<ref>Shulchan Aruch Y.D. 173:2</ref> | ||
====Limitation on Tarsha==== | |||
# If the buyer's intention is purely to buy the item on credit in order to sell it immediately for a cheaper value that is considered a prohibited since it as though the cheaper price is stipulated as the value of the loan and yet he agreed to repay a higher amount.<ref>The Ritva b"m 65a cited by Bedek Habayit 173 writes that if someone purchases a commodity on credit it is permitted if the price isn't clear. However, if the buyer immediately sells it for less it shows that the loan obligated him to pay more than the value of the item and is interest. Chatom Sofer YD 137 follows the Ritva and writes that one can't bring a proof from Shulchan Aruch 163:3 or Taz 163:6 who imply otherwise since they didn't have the Ritva.</ref> | |||
====Prepayments to Reduce Cost==== | |||
# A buyer and seller agreed upon a price for buying on credit and the sale was validated with a complete and formal acquisition. Then they renegotiate that if the buyer pays right away he doesn't have to pay as much that is permitted.<Ref>Shulchan Aruch 173:3</ref> | |||
===Payments in Advance=== | ===Payments in Advance=== | ||
#Generally it is forbidden to sell something for cheaper when the buyer pays in advance.<ref>Shulchan Aruch Y.D. 173:7</ref> | #Generally it is forbidden to sell something for cheaper when the buyer pays in advance.<ref>Shulchan Aruch Y.D. 173:7</ref> | ||
