Debt in the Bible | Is Borrowing Money a Sin?

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Here’s my summary of what the Bible says about debt: it’s not a wise thing to do, but it’s not a sin.

Honestly, the Bibles doesn’t have an exclusively negative stance on debt.  There are situations where borrowing is a good option.

Be careful not to harbor this wicked thought: “The seventh year, the year for canceling debts, is near,” so that you do not show ill will toward your needy brother and give him nothing. He may then appeal to the Lord against you, and you will be found guilty of sin. (Deuteronomy 15:9 NIV)

It seems to me that the loving thing a Christian can do is to lend to his brother who is in need.  If lending is a blessing to that person then it must bless the borrower to borrow.  Lending can fulfill the commandment to love our neighbors. 

Give to the one who asks you, and do not turn away from the one who wants to borrow from you. (Matthew 5:42 NIV)

Once again, we see the Bible encouraging the practice of lending.  Which would only be approved, I believe, if it was in the best interest of the borrower and the lender.

So, what are we to make of all this?

  1. When the Bible talks about lending, you MUST remember it is talking about a completely different borrowing and lending culture than our own.
  2. If lending money to someone can bless them, then some borrowing leads to freedom, not to slavery.  It is a blessing to people.  Yes, I know that people will want to show me Proverbs 22:7 and tell me that I’m violating a teaching of the Bible.  I believe that there is a Biblical teaching on borrowing and lending, and it is not succinctly summarized in one passage popularized by Dave Ramsey. 

Because of these Bible verses, I’m in the process of setting up a system whereby I lend money to local Christians who want to start small businesses.  I think this lending context honors the same borrowing and lending culture in the Bible.  I think that borrowing can be a good option for those who participate in the program.

BUT, North American lending and borrowing is a whole ‘nother animal.

My biggest personal concern with much of the debt people take on in a North American context comes from the fact that motivations for borrowing are not biblical.

Borrowing under the right circumstances can make sense.  Borrowing can be a good option.  However, 99% of the borrowing in North America is because of unhealthy reasons. 

Three Unhealthy Reasons Why People Borrow

Impatience

People take on a debt because they are unwilling to wait until they have the cash necessary.  I’ve already shown how much you can save over a lifetime when you pay cash for cars.  However, most people are unwilling to be inconvenienced for an initial two to three years.  I call that impatience.  Yet, the Bible said that patience is a fruit of the spirit (Gal. 5:22).  It is a Christ-like characteristic when you don’t need everything now.  You are willing to wait.

But the fruit of the Spirit is love, joy, peace, patience, kindness, goodness, faithfulness, gentleness and self-control. Against such things there is no law. (Galatians 5:22-23 NIV)

Materialism

People take on debt because they convince themselves that what they want to buy, they need.  Interestingly, in human history more people have lived without that item than with that item.  Consider again the car.  People buy a car because they need a car.  How many people, historically, had cars?  Yet, we need it.  Spending and consumerism comes from advertising that seeks to encourage us to move wants into the needs category. 

    Those who belong to Christ Jesus have crucified the sinful nature with its passions and desires. (Galatians 5:24 NIV)

Acceptance

Sometimes we borrow so that we’ll have what others have.  Part of our humanity is the desire to be loved.  How many people go looking for love in all the wrong places?  Some do it through owning material possessions.  We buy the clothes needed to be accepted.  We buy the houses needed to belong.  We put our kids in the extra-curricular activities everyone else is part of – even if we can’t afford these things.  As Christians, we have been accepted by Jesus Christ.  That is all the acceptance we need.

    “For God so loved the world that he gave his one and only Son, that whoever believes in him shall not perish but have eternal life. (John 3:16 NIV)

Is borrowing wrong?

The Bible does not answer that question until you say why you want to borrow.  I believe if you want to borrow for one of the three reasons above then it is wrong.  However, if your motives are pure, your options limited, and the lender is gracious then there can be situations where borrowing is acceptable.

But, as for me and my household we hope to move completely out of the situation where we will ever need to borrow again.  Most folks in North America have the resources to live debt free, but they simply have not made the choice to live debt free.

Comments

  1. says

    Clarification question… Are you saying that all borrowing is unwise? I know we definitely can’t say it is sin, but is it fair to even say all borrowing is unwise? I’m on board that as a general rule borrowing is unwise and there is always a risk with borrowing. But that doesn’t make all borrowing in every situation unwise does it? But of course, maybe you are not saying that?

    My point is that some claim that all borrowing is unwise, so therefore it is unspiritual to ever borrow. So Christians will sometimes respond that it certainly isn’t a sin to borrow but it is definitely unwise and therefore infer that the Christian who does borrow is being foolish or at least not as wise as the person who does not borrow.

    Your thoughts?

    • says

      @John
      Thanks for your comment.
      Honestly, I guess I wouldn’t say ALL borrowing is unwise. I’m sure that there are settings and situations where borrowing would actually be a very wise move. However, for the majority of people in North America their borrowing patters reflect unwise decisions not wise decisions.

  2. Eric says

    Craig,

    This is definitely a good topic to discuss.

    As for John’s comment, I have a hard time believing God would ask us to lend willingly to our neighbors (Mat 5:42) if borrowing was always foolish in God’s eyes.

  3. says

    Very good summary Craig. The topic of debt and what the Bible says about it is always interesting to read – especially since many people hold such different opinions.

    I agree that borrowing for the right reasons doesn’t make debt a sin. You sin when you intentionally try to harm the lender or if you have impure motives – materialism, greed, impatience, etc.

    The Bible definitely cautions us about borrowing and lending, but I don’t feel that all debt is unwise. Your lending idea sounds great! Is it unwise because it involves debt? No I don’t think so. (Should you lend to EVERYONE who asks…that’s a harder question)

    I’ll be curious to hear how your lending efforts are doing!

    Tim

    • says

      @Tim
      I’ll definitely keep everyone updated on how the lending project goes. This weekend I’m having a small business seminar because before I lend I want to educate.

  4. Oregonsun says

    Very good article. Wish I had been wiser when I was younger. We used to use credit cards (ugh), make car payments. Sad but true. We finally stopped the nonsense a few years ago and are now trying to pay off our mortgage early. Probably would have been a lot wiser to have only had a 10 to 15 yr mortgage but we couldn’t afford that so we took longer term. For us it was a mistake that we are trying to correct as fast as we can.

  5. says

    Great analysis, Craig. You mirrored many of the same conclusions I came to in studying what the Bible says about debt. I really appreciated your look at why most borrowing in North America is probably unwise and can often be an outgrowth of our sinful nature.

    As far as John’s comment, I’d say that not all borrowing is unwise. There are times when it can make sense, but they are rarer than people think. Even though it’s not always unwise, you can still be successful and manage money well without borrowing at all. It’s not a necessary step in personal finance – by God’s standards or anyone else’s.

    • andrew says

      I don’t like the way people so often presume to make borrowing imply poor management, rather than the other way around, ending up saying that with good management you can be sure to avoid debt. Apart from anything else this is just poor logic. Anecdotally most who I know borrow from a position of unavoidable hardship. Also the ideal of not borrowing is followed fanatically it can lead to inappropriate conflict and hardship

  6. Gholmes says

    I agree borrowing is not a sin. However, I do say when you are in debt (north america) you are slave to the lender. That Proverbs passage doesn’t say it is sin.

    So what about usury “interest”. Should Christians lend to each other with no interest? (I do think your missionary lending is great idea)

    From the Hebrew Bible, 1917 Jewish Publication Society translation:
    If thou lend money to any of My people, even to the poor with thee, thou shalt not be to him as a creditor; neither shall ye lay upon him interest. (Exodus, 22:25)[22]

  7. says

    I think it’s not clear cut. Racking up credit card debt for trips, eating out, etc? Not good at all.
    Using a conservative approach, 20% or more down, to buy a house whose payment is below, say 28%, of your income, neither bad, nor foolish.
    After 14 years and many refinances, my mortgage plus property tax is about 16% of our gross income. It will be paid off in 7 more years or less. Given that the median house is nearly 3X the median income, it’s a daunting task to avoid a mortgage altogether. I wonder how many first time buyers are 100% cash?

    One subtle thing I’m not clear on – are credit cards considered ‘borrowing’ even when paid in full every month? In theory, I am always in debt. In reality, aside from the mortgage, I pay no interest. So it that debt as well?

  8. says

    JoeTaxpayer brings up a good question about credit cards. I would think that it’s just a wise use of available resources (i.e. to get points and rewards) if you pay it off in full every month.

    What are your thoughts Craig?

  9. Gholmes says

    @ Joe Taxpayer. I wonder if the reason a median house is 3x the median income is because of the credit that is out there?

  10. says

    Ghomes – perhaps – let’s do the math. Median income looks about $50,000.
    28% of that is $1167. This would support a mortgage of $230,000. Since that $1167 should also cover property tax, knock the mortgage down to $180,000, and that’s 80% loan on a $225K home. This is at 4.5% 30 yr fixed.
    The lack of faith in the system and bank’s unwillingness to lend has strangled the system. The affordability has reached a high level right now as the median home (~$150K) can be had for a payment of $608/mo or less than 15% of median income.

  11. Moe says

    Hi Craig… I am somewhat confused about your article… You stated “When the Bible talks about lending, you MUST remember it is talking about a completely different borrowing and lending culture than our own. ” While I understand what you are trying to clarify, the article seems to be going in circles… No the bible does not say that borrowing or lending is wrong, however it does warn against it and rarely anything good to say about it. For example, Romans 13:8… Debt makes us a slave to the lender, even a Christian lender… And as it is stated no man can serve two masters… I realize that this day and age, debt has become an acceptable way of life… Yet, perpetual debt is not good, not even mortgage debt… I agree with you, that we should pray and look toward the wisdom of the bible for answers… Again, although the bible does not forbid lending and borrowing, we must also consider the times that those mentioned in the bible borrowed… We must also consider the seven year release of debt as well as having mercy and not charing usury. I welcome your feedback.

    • says

      Moe,
      Thanks for your comment. I suspect you were expecting more from this article than I was able to deliver because of the focus of this post. I’ve heard people claim that borrowing money is a sin. This article only addresses that question – is borrowing money a sin? My answer is no. In, other articles I have deal more holistically with the topic.

    • andrew says

      I don’t like the way people so often presume to make borrowing imply poor management, rather than the other way around, ending up saying that with good management you can be sure to avoid debt. Apart from anything else this is just poor logic. Anecdotally most who I know borrow from a position of unavoidable hardship. Also the ideal of not borrowing is followed fanatically it can lead to inappropriate conflict and hardship

    • andrew says

      The bible encourages us to lend. It says if someone asks to borrow, then lend, don’t withhold. Do you think only rich people should buy a house? Say you are called to be a care worker you you will never be able to save enough to keep step with house inflation, but if you borrow your debt will devalue.

      The real problem is this however, people want to take things which are not rules in the bible and tell people there are rules, instead of just encouraging people to walk in faith, wisdom and relationship.

  12. Overindebted says

    Hi All,
    I’ve been reading through everyone’s comments and wonder what you would advise in our situation: My husband and I (and our 3 children) don’t live in North America, but in South Africa:-). We are Christians and despite wanting to avoid debt and currently living only on cash (no mortgage, we rent a one bedroom apartment and our car is second hand and almost paid up) we have debt from 9 years ago when I lost my job as the company closed down unexpectedly and 3 years ago when my husband lost his job and stable income(and our very inexpensive house due to an interest rate hike which made it unaffordable to keep). At that time he basically had no income for in total about six months and we had to borrow money just to survive. Since then, he has been running his own bakery business which brings in just enough for food and petrol (we stay in an area where there isn’t reliable, safe public transport and need the car for our business deliveries etc). He appies for permanent jobs on an ongoing basis with no success so far. Our rent is paid by his commission from insurance policies he’s sold in the past and financial help from our parents. Because our debt is over a certain amount, we do not qualify for an administration order and because he is a commission earner, we don’t qualify for debt review or voluntary distribution. As we do not own any real assets, we also don’t qualify for insolvency. Every time I read or think about Rom 13:8 I cringe and feel quite hopeless..What advice would you give to a family in our postion, what would the biblical way be to deal with this?

    • says

      Overindebted,
      Sorry for my slow reply. I thinking you’re doing as much as can be expected in your situation. You seem to be living simply and are proactively seeking income earning opportunities. I think you’re developing a healthy distaste for debt which is how I think we ought to view debt. Keep being persistent and Lord willing one day you’ll pay off your last debt. If you have any other specific questions please let me know.

  13. nikki says

    so i have a situation. my older brother is asking me to loan him $100 claiming that he’ll pay me back. but he hasn’t paid me back the $2000+ dollars from three years ago. i don’t wanna keep lending him money and not get it back. i’m a college student and i don’t have a full-time job so my monthly income is limited.

    i do want to help out but at the same time, i need to start saving up money for my future.

    any advice?

  14. JD says

    Nikki, trust me on this one, don’t do it. If you can’t afford to lose it then don’t. We loaned over $10,000 and well, after many years, nothing. It damaged the relationship, the person(s) that borrowed it no longer speak. I am referring to family members, so I wouldn’t do it again. We give to the charities we chose and leave it at that.

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