In pleading with Yosef on behalf of Binyamin, Yehudah, the leader of Yaakov’s sons, includes the following argument:
“For your servant became a pledge for the boy unto my father, saying, If I bring him not unto you, then I shall bear the blame to my father forever. Now therefore, please let your servant remain instead of the boy, a slave to my lord; and let the boy go up with his brothers. For how shall I go up to my father if the boy is not with me? I fear to see the evil that would find my father.” (Bereishis 44:32-34)
Yehudah, as we learn in Parashas Miketz, became an arev, a guarantor, to Yaakov for the safety of Binyamin. His suggestion that he should replace Binyamin as a slave to Yosef was a direct consequence of this arvus: He was prepared to give up his own freedom in exchange for freeing Binyamin.
In the present article we will reflect on and discuss some central aspects of arvus, becoming a guarantor for financial obligations. (The Gemara (Bava Basra 173B) attempts to derive this concept from Yehuda’s guarantee for Binyamin.) Is there a mitzvah to become an arev, or should it be avoided wherever possible? What are the principles of a creditor collecting his debt from the guarantor? Can an arev retract his commitment? These, and other matters, are discussed below.
Is Arvus a Mitzvah?
We live in a world where debt is an integral part of life. In such a world, the question of acting as a guarantor on behalf of a debtor is one that we face often. This might be guaranteeing a private loan, a loan from a Gemach (free loan society), or a bank loan—each of which can have different consequences for the guarantor.
Indeed, a short browse on our dinonline.org site will quickly demonstrate the frequency with which people ask the question: Is it a mitzvah, or proper, to accept the responsibility of being a guarantor, or is this something to avoid?
The Gemara (Yevamos 109a), citing a Baraisa in the name of Bar Kapara, advises a person to keep his distance from three things. One of these is becoming a guarantor for someone’s debt.
In fact, a number of verses in Mishlei precede the Talmudic warning, and make it clear that a person is well advised to refrain from becoming a guarantor on loans.
In one instance, Mishlei refers to acting as a guarantor to a stranger: “He who is guarantor for a stranger will surely suffer for it. But he who hates being a guarantor is secure” (11:15). Elsewhere, Mishlei makes the statement in general terms: “Do not be among those who give pledges, among those who become guarantors for debts” (22:26).
In the opening of Chap. 6, the verses mention both a neighbor and a stranger: “My son, if you have become surety for your neighbor, if you have shaken hands in pledge for a stranger, you have been trapped by what you said, ensnared by the words of your mouth.”
In contrast with giving a loan to the needy which is a full Torah obligation, it seems that guaranteeing a loan is not a positive virtue, and is even presented as being negative in “enslaving” oneself to somebody else’s actions.
The psychological difference between the two is clear: In the case of a loan, the lender gives his money in full awareness of the risk that the debtor might default in his repayment. In the case of a guarantor, the fact that there is no immediate outlay, together with the hope or assumption that there will never be one, often bring people to guarantee loans beyond their means to pay. Experience shows that this can have most unfortunate ramifications.
Different Types of Loans
The aforementioned Gemara proceeds to mitigate the warning against acting as a guarantor, explaining that this applies only to a particular type of arvus called arvei shel-zion. In this type of arvus, the creditor can collect his debt from the guarantor even without requesting payment from the debtor himself.
The implication is that only this type of arvus should be avoided, whereas it is acceptable to serve as a regular guarantor, who must pay the debt only if the original debtor cannot pay.
However, the Rambam (De’os 5:13), when listing the traits of a Talmid Chacham, writes that such a person is careful not to be any kind of guarantor. The Meiri explains (in his commentary on the Gemara) that the case of an arev shel-zion is particularly ill-advised, but that even becoming a regular arev is to be avoided (and even for regular people, not only for Torah scholars).
Based on the passages in Mishlei, the Vilna Gaon (Mishlei 11:15) likewise advises against accepting upon oneself to be any type of guarantor.
At the same time, we cannot ignore the fact that in many instances, a person’s willingness or otherwise to guarantee a loan will determine whether or not the debtor will receive the loan. This is especially true of free loan societies: without reliable arevim, the gemach will refuse to lend money. This being the case, there are sources that place lending money, which is of course a mitzvah, together with committing to acting as a guarantor (see, for example, Mordechai, Bava Kamma no. 160).
As a possible resolution of the tension between arvus as a mitzvah and a pitfall, it is worth noting the Chafetz Chaim (Ahavas Chessed, II:21, in a footnote), who explains that it is proper to serve as an arev where a person fully understands the risk involved, while if he does not appreciate the gravity and importance of becoming an arev, he should refrain from doing so.
More specifically, if he is aware of the fact that the lender relies on him in giving the loan and that he, as an arev, is responsible for ensuring that the loan is repaid; and if he is prepared to repay it in the event of the debtor defaulting—then it is right and proper to guarantee a loan.
In his practical conclusion on the subject, Rav Mendel Shafran writes that a person should take the specific circumstances of the case into account. For mortgages, for instance, he writes that one should be favorably inclined to sign as a guarantor: the house itself is mortgaged to the loan, there are other guarantors, and the norm is to pay it back. For a business loan, however, the reluctance articulated by sources above should be heeded.
When Does an Arev Have to Pay?
As noted above, a creditor can only claim payment from a regular arev if the debtor himself has already been approached and cannot pay the debt. This halachah is stated in the Mishnah (Bava Basra 173a) and ruled by the Shulchan Aruch (Choshen Mishpat 129:68).
When, however, is it considered that the debtor cannot pay? In many instances, the debtor owns a range of assents, including a home, a car, and so on, from which it might be possible to collect the loan. Can the arev instruct the creditor to collect the debt from such assets, or, in the absence of cash, must he pay the debt himself?
In principle, it is clear that a creditor must first attempt to collect his debt from the debtor’s assets, before he turns to the guarantor for payment. A person’s assets are as good as money, and his responsibility to pay the creditor certainly extends to his personal assets. However, experience shows that debtors are often very unwilling to part from their assets—even those that must be handed over according to halachah.
Under such circumstances, and where going to Beis Din is ineffective, the only way for the creditor to collect the debt from the debtor is by taking him to secular court. Kometz Haminchah (114) rules that where a debtor refuses to pay, a creditor must take his debtor to court before collecting the debt from the arev.
However, his ruling is based on two assumptions which applied in his days: 1. That the creditor will not incur any costs in the process, since the court collects the cost from the debtor; 2. That turning to the courts is common, so that the creditor was aware at the time of the loan that he would have to exhaust his options in court before turning to the arev for payment.
It does not seem that these assumptions are true today. The process of going to court can be long and arduous, and full costs that are not generally awarded. Moreover, it is not common practice today to end up in court, and it is hard to argue that the creditor assumed, upon giving the loan, that he would go to court before turning to the arev for payment.
It seems rather that if a debtor refuses to pay, and refuses to heed the instructions of a Beis Din in this regard, he would be considered a gavra alma (Shulchan Aruch 129:8)—somebody who does not cooperate with halachah and with Beis Din—which permits the creditor to turn to the arev for payment.
The Sema (129:31) notes that if the difficult nature of the debtor was known in advance, so that the creditor knew he would have a hard time collecting the debt, he cannot turn to the arev without first seeking to collect the debt by any means available to him—he makes particular note of using Beis Din to coerce payment. Yet, Rav Mendel Shafran has pointed out (Alon HaMishpat 51) that this might not apply today, where Beis Din lacks the power to coerce payment, and the creditor would have to go to court for this purpose.
Note that Rabbenu Tam (Sefer Hayashar 656) rules writes that even where the debtor has no real estate, the creditor must still turn to him before he claims the debt from the arev. The reason for this is that it is always possible that the debtor has other resources at his disposal, and the creditor must exhaust these options before collecting the debt from the arev.
Retraction of an Arev
Can an arev retract his commitment to guarantee a loan?
Once a loan has been made, it is clearly too late to retract: The creditor gave the loan based on the guarantee offered by the arev, and his agreement to do so is fully binding. In advance of the loan’s execution, however, the arev is free to change his mind (Choshen Mishpat 131:1).
Note that under these circumstances he must inform the potential lender of this decision before the loan takes place. If he fails to do so, and the creditor lends the money based on the assumption of his guarantee, it seems that if the debtor defaults the guarantor will be liable to pay. The creditor, under these circumstances, has spent his money in reliance on the arev, and this is sufficient to render him liable for payment (see Nesivos Ha-Mishpat 122:3; 182:3).
Sometimes, a dispute arises between the creditor and the arev as to whether he retracted before the loan or not. In this case, because the default situation is that the arev is liable to pay, the onus falls on him to demonstrate that he had already informed the creditor of his retraction (for instance, by producing relevant documentation, emails, and so on).
However, Shut Maharashdam (38) suggests just the opposite—that in cases under dispute, the arev is believed in his claim that he had informed the lender of his retraction before the loan took place. However, this ruling applies specifically to the case under discussion, where the creditor had previously refused to rely on the arev’s guarantee (the creditor refused to rely on the arev, but later went ahead with the loan without consulting with the guarantor), so that there is no default assumption of the arev’s commitment to the present loan.
In ordinary circumstances, the arev is not believed without his adducing proof to having notified the lender, for otherwise every arev can claim that he had retracted, and thereby exempt himself from payment.
An interesting case arose when a guarantor claimed that he sent a fax canceling his offer to act as an arev, while the creditor claimed that he did not see the fax until the loan was already given. Rav Yehuda Silman notes that since the guarantor acted reasonably in trying to inform the creditor of his retraction from responsibility, he cannot be held liable as a guarantor.
There are a number of important details concerning arvus that we have not discussed. What is the difference between somebody who agrees to be an arev in advance of the loan, and somebody who commits to arvus after the loan has already been taken? What are the details of an arev kablan, and how does a person accept this commitment? Can an arev claim that the debtor has already paid off the debt, where the debtor himself is unavailable for comment?
We will, Be’ezras Hashem, address these questions in the coming article.
