Avoiding Debt & Never Charging Interest
If we do not wish to be slaves, then how can we enslave others?
One of my favorite things about living in rural Russia is the opportunity to get out of debt. When I lived in rural America, I had a house and land, but I was also up to my eyeballs in mortgage debt. Now that my family and I live in Russia, we no longer have this problem. Here, it is possible to purchase an inexpensive house (less than fifty grand), and inexpensive land (less than a thousand dollars per acre).
According to Holy Scripture, “The rich rules over the poor, and the borrower is the slave of the lender.” (Proverbs 22:7) This principle applies to many sorts of debt, including mortgage loans and car loans. Thankfully, here in Russia, we are slaves no longer. My house and cars may not be fancy, but I don’t owe anything on them.
We often hear encouragement to get out of debt. But the other side of the coin is just as important. If we do not wish to be slaves, then how can we enslave others? — If you loan money to someone else, you must never charge interest.
For 2000 years, Holy Scripture and the Church Fathers have spoken with one voice: It is a sin to charge interest on a loan. Charging interest is evidence of greed, and is a sign of avarice.
The Psalmist, among many others in Scripture, speaks out strongly against usury. For people to be righteous, Scripture says the following criteria are necessary:
They do not charge interest on money they lend and do not take money to hurt innocent people. Whoever does all these things will never be destroyed. (Psalm 15:5)
In his “Explanation of the Psalms”, Cassiodorus (a 6th century monk) commented on this passage of Scripture. He pointed out that “we are absolutely forbidden to put [money] out to usury, because it is the vice of greed to seek to demand what you know you have not lent.”
We are forbidden to collect interest, because it is money we have not earned, money we have not worked for. We did not lend that interest to the person in the first place, so by what right do we collect it?
St. Leo the Great makes similar comments regarding loans that accrue interest:
The evil of usury must be shunned, and the profit that lacks all human kindness must be avoided. The means for unjust and grievous gain is increased, but the essence of the soul is worn down, since usury in money is the ruin of the soul. The holy prophet David showed what God thinks about the people of this kind when he says, “Lord, who will dwell in your tent, or who will rest on your holy mountain?” Those are taught by the reply of the divine voice, and those know that they have a part in eternal rest if, among the other rules of a holy life, “they do not give their own money at usury.” They are shown to be strangers to the “tent” of God and foreign to his “holy mountain” if they seize a deceitful profit for their money by usury, and, while they want to be rich through another’s loss, they are worthy to be punished by eternal penury
— St. Leo the Great
If a person cannot afford life’s necessities, then after loaning him the necessary money, how will he be able to repay the entire loan, and interest besides? Instead of seeking to profit from his misery, we would do better to give alms.
St. Ambrose observed, “Nations have often failed because of usury, and this has been the cause of public calamity. “
St. Basil the Great, in his Homilies on the Psalms, gives a more extended treatment of this passage of Scripture (Psalm 15):
Give the money, since it is lying idle, without weighing it down with additional charges, and it will be good for both of you. There will be for you the assurance of its safety because of his custody; for him receiving it, the advantage from its use. And, if you are seeking additional payment, be satisfied with that from the Lord. He himself will pay the interest for the poor. Expect kindly acts from him who is truly kind.
This interest, which you take, is full of extreme inhumanity. You make profit from misfortune, you collect money from tears, you strangle the naked, you beat the famished; nowhere is there mercy, no thought of relationship with the sufferer; and you call the profits from these things humane!
Woe to you who say that the bitter is sweet and the sweet bitter, and who call inhumanity by the name of humanity. . . . “People do not gather grapes from thorns or figs from thistles,” or humanity from interest. Every “bad tree bears bad fruit.”
Some are collectors of a hundredfold and some collectors of tenfold, names horrible indeed to hear; monthly exactors, they attack the poor according to the cycles of the moon, like those demons that cause epileptic fits.
It is wicked lending for both, for the giver and for the receiver, bringing loss to the one in money and to the other in soul.… It is not evident for whom you collect. It is indeed apparent who he is who weeps because of the interest, but it is doubtful who he is who is to enjoy the abundance that comes from it. In fact, it is uncertain whether you will not leave to others the gift of wealth, but the evil of injustice you have treasured up for yourself. “And from him who would borrow of you, do not turn away,” and do not give your money at interest, in order that, having been taught what is good from the Old and the New Testament, you may depart to the Lord with good hope, receiving there the interest from your good deeds, in Christ Jesus our Lord, to whom be glory and power forever. Amen.
— St. Basil the Great
In both the Old Testament and the New Testament, many passages mirror the teaching of Psalm 15. Lending money is OK, but charging interest is prohibited.
There is also great consensus among the Fathers of the Church, agreeing with St. Ambrose, St. Leo, and St. Basil. Charging interest is a failure to love one’s neighbor.
yrs ago I was a mormon... at an annual worldwide meeting the future prophet told a story about a man who Had stolen change from his bedroom (unbeknownst to him) and later repented and brought the money back.... the future profit's response was ... 'yes he gave back the money BUT WHERE WAS MY INTEREST!' I found that revolting then and a religious satire of sorts....
Sunds very nice, and I certainly agree that charging too high rates is morally bad.
But interests rates are the foundation of our economiy. If there is inflation the lender will lose money if there is no interests. Besides there might be a risk of losing his money or part of it and the lender is payed to take this risk.
I'm not defending our current system, it's perverted.
Interests are one of the foundations of capitalism. Again, I am not defending our current state of capitalism. It's out of control. Capitalism has been around since the first civilisations and with it some kind of payment to you if you lend out your capital.