Free Yourself from the Debts of Another

For those of you new to Free Money Finance, I post on The Bible and Money every Sunday. Here's why.

Today I'm posting Proverbs 6:1-5, a series of verses that talks about what we would call today co-signing a loan (the Bible calls it different things depending on the translation). Let's start with the NIV version:

My son, if you have put up security for your neighbor, if you have struck hands in pledge for another, if you have been trapped by what you said, ensnared by the words of your mouth, then do this, my son, to free yourself, since you have fallen into your neighbor’s hands:

Go and humble yourself; press your plea with your neighbor! Allow no sleep to your eyes, no slumber to your eyelids. Free yourself, like a gazelle from the hand of the hunter, like a bird from the snare of the fowler.

As I did on an earlier post, I want to share the (clearer) Contemporary English Version (CEV) translation. Their take:

My child, suppose you agree to pay the debt of someone, who cannot repay a loan. Then you are trapped by your own words, and you are now in the power of someone else. Here is what you should do:

Go and beg for permission to call off the agreement. Do this before you fall asleep or even get sleepy. Save yourself, just as a deer or a bird tries to escape from a hunter.

And just because it's always an interesting interpretation, here's what the Message says in these verses:

Dear friend, if you've gone into hock with your neighbor or locked yourself into a deal with a stranger, If you've impulsively promised the shirt off your back and now find yourself shivering out in the cold, Friend, don't waste a minute, get yourself out of that mess. You're in that man's clutches!

Go, put on a long face; act desperate. Don't procrastinate—there's no time to lose. Run like a deer from the hunter, fly like a bird from the trapper!

Not a glowing endorsement for co-signing, huh?

Thoughts and comments?

Comments

[Jesslyn]

I am not a Christian yet. I think what the article has presented good values we can learn from.

If we have promised someone to help out, we should honor what we say. And if we cant deliver what was being promised for some reasons, we should try and look for alternative ways which can honor our promises.

[Adam]

This rings so true for me. I co-signed with my cousin, who also happens to be a good friend of mine, and now I cant buy investment property because that loan has my name on it. She was already late once on the loan which I had to pay up $350 to not get it on my credit(she did eventually pay back). I have asked her if she could refinance the loan with someone else and she does not appear to be working really hard at doing so. I am pretty stuck at the moment.

[Matt]

I think we don't take debt serious enough. You should only borrow money that you know you will pay back in full. If someone is asking for a co-signer that is a clue that there is question in the loaners mind.

I do not know if I ever would co-sign for a loan because I take it that seriously and unless that person displays that same character to me, I would have to say sorry.

If my brother or sister showed up on my door step broke and no place to stay they can have a room to sleep in my house and food off my table.

Cosign for a loan, I would not and they know it because I have been asked.

[Lori Wiegmann]

I agree about not co signing. But, God's Word also says "let your yes be yes and your no, no"Matthew 5:37. I think the New Covenant is clear about our charity to our fellow man. If it is something that you cannot afford, then by all means go back to your brother and get out of the situation, but, if it isn't and you have made a commitment, then you should honor it.

[Keith]

I have never co-signed for anything and never plan too.

[Charlotte@EverythingFinance]

I don't feel you should co-sign if you can't afford for that person to miss a payment. A true friend will understand when you have to say no.

[Kelly@FinancialBailoutNews]

I really like this direct correlation between a verse from the bible,and a concept that is too often taken lightly in the real world sense. Debt can absolutely ruin a persons financial situation, reputation and relationships with others. Too many people I know see loans and debt as something wishy washy, when in reality its a serious situation to be in. I would never be the kind of person to take a loan or spend money that I know I couldn't pay back- especially in the situation of a personal loan from a family member or a friend.

[Steve]

Surprised by the responses on here. Nothing wrong with co-signing if the person is reliable, trustworthy, and responsible. My dad cosigned on two loans for me because my credit was non-existent and they were paid off in full and on-time, completely by me. It helped me get through school and pay for a car. It got me on my feet.

I'm not suggesting to find a random 17 year old and cosign for a new Corvette, but the assumptions and descriptions made in those verses is nothing short of insulting to the people who have been on either side of a cosign, especially those attempting to help someone else.

How is giving away 20% of your income somehow so much less of a burden than merely signing your name on something that you may not even have to pay for? It's another form of charity in my eyes, and like any other financial decision, shouldn't be made without thought.

[BD]

Steve: When you cosign, you are essentially saying that you are responsible for the full amount of the loan that's still outstanding, were anything to happen.

So, if you're correlating co-signing to giving away your income as a tithe/offering, then yes, there is nothing wrong with co-signing... IF you should have the entire amount of the loan set aside in a "giving" fund, and are able to fully repay the loan in case the primary on the loan happens to default in their payments.

Otherwise, if you do not have the full amount of the loan in accessible tender that you're able to give away, you are taking an oath that you might not be able to fulfill, which is against biblical principles.

[Steve]

I don't care about biblical principles, I'm talking about finances. Cosigning is a weighed decision just like anything else. Don't be stupid about it; same as every other financial decision we make.