Question:
Two shilos in regards to Heter Iska
1. Does it need to be written or is agreed upon enough?
2. Do both parties have to sign it?
Answer:
Kitzur Shulchan Aruch (66:7) writes that a Hetter Iska should be written, but bsha’as hadechak (if difficult to arrange) an oral agreement is sufficient.
It is important, however, that both parties understand the concept of the Hetter Iska, and appreciate what they are commiting themselves to, and not think that this is simply a Torah-mandated hocus pocus that permits lending with Ribbis.
[If the Iska is a half loan half pikadon, and there is a written shtar for the whole amount that does not define this as an Iska, there should be a written Hetter Iska otherwise the malveh may claim the whole amount even if the investment depreciated.]
Since the Shtar Hetter Iska defines the rights and obligations of both parties, they should both sign. In particular, if the borrower does not sign, the lender will not be able to prove that the borrower agreed to the terms.
