ריבית

Question:

shalom shavua tov

thank you for your very informative response

regarding the 2 questions you asked

1 how was the money was borrowed ?
the money was transferred into my bank account and we wrote a shtar rayah definitely not a shtar kinyan

2 have I made a kinyan on the house ?
no I have not made a kinyan on the house

I just don’t fully understand the last point in your response.
Quote ” a side point, it is noteworthy that you should make up, that the profit that you will be giving your father should start from when you are actually getting 10% profit from the loan, and not when the money is only in the bank, otherwise you will be giving him more profit then what you yourself are making. The bank is not giving you 10%..”
Why I would not be able to give my father a share in the interest received from the bank after doing the heter iska ( I understand why I can’t do it before the iska) surely once he is a partner if I choose to make a profit by placing the money in the bank is that not profit that he is entitled to?

I have attached our previous correspondence
if you need it for reference as im sure you have many questions to deal with

thank you once again for your time and effort

ריבית
Question:
shalom hope this finds you well I wrote a Question on the 22 06 2020 I only recently check the status which said it had been answered on the 26 06 2020 unfortunately I cant find the response in any of my emails I was asked to resend the topic of the question to aid tracking it it was a Question on ריבית the question number was #57093 I would so very much appreciate if you could resend the answer if this is not possible I’m happy to resend the entire question kol tov Raphael
Answer:
Thanks for providing the date of the question. I think you are referring to the following question
Question:
Good day Rabbonim hope this finds you well I was referred to ask of your expert opinion I have a question regarding ריבית and I really hope you could help me and guide me with your expertise in these הלכות I have loaned some money to a goy (the loan is structured in a way that I purchase a house which the goy will live in and over a number of years buy the house from me for the amount that I purchased the house with an increase of 10% of the total purchase price per anium). For this loan I had borrowed money from my father with the intention of paying him back only the capital, however I subsequently thought to allow my father the option to also make profit so we decided to convert the loan into a partnership and we would receive profits from the loan to the goy based on the percentage of our respective capital. (The goy has no knowledge of any one else involved besides myself) Question 1 is that a sufficient way to convert it into a partnership or must I first transfer the money back and then take it again as a partnership, however even though my father and I are in a partnership my father doesn’t want the house registered in the deeds office in his name whatsoever so from a secular/or document perspective the house will be entirely in my name? Question. 2 Does the secular system override or have an effect on our agreement to be a partnership? Question 3 Even if the answer to Question 2 is that the secular system doesn’t override our partnership however since there is actually a document stating that the house is entirely mine and no proper documentation proving that we are partners.Is this perhaps an overriding fact that we are really dealing with a loan between my father and myself if this is so what do I do a) have a document between ourselves stating that we are really partners even though the property is officially in only one of our names ,there would then be conflicting שטרות- just one is for the “public eye”/civil secular system b) התר עיסקה …? this partnership that I entered into with my father which – I wanted to do to also give my father the opportunity to gain profit – is on the condition that if חס ושלום some one had to pass on, it would revert back to a loan and one would only have to pay the capital back and no interest from the goy whatsoever ie the partnership will not be bequeathed only the loan Question 4 Does such a condition work Question 5 If yes does this have an effect on the status to be considered a true partnership or is it now a “loan in disguise” because of the possibility such a scenario could חס ושלום occur in the interim (before the transfer occurs) the money from my father and I, is in the lawyer’s bank account earning interest- again all in my name ,no mention of my father at all ((in our mind we partners, originally received as a loan however on paper all in my name alone)) Question 6 Regarding the interest from the bank would I be allowed to give my father his percentage as if we are partners Thank you so much for taking the time to read and hopefully guide me on what the correct halachic approach should be very much appreciated
Answer:
Hi, The way the heter iska works, is that your father essentially is a partner in all of your business deals, and the amount of profit that you are giving him for his part of the partnership is the amount that you agree upon. For example, if your father loaned you $50,000 and you are going to give him $5,000 interest, after the heter iska, he has a partnership in all of your business dealings, and his part of the profit of the business is $5,000 a year. Therefore, it will not matter whether the house is in your name and not in his name etc., because he is definitely not a registered partner in all of your business deals, and he doesn’t have to. This is an internal deal that you made with him, to give him a part of all your business dealings.. Therefore there is no need to worry about his name on the contract of the house. This will take care of a number of your questions. Regarding how to make the heter iska, since the loan was already given, you will have to make a kinyan with him when you sign the heter iska. This means that you will pick up his pen, handkerchief etc. and with that you are giving him a part of the profits of all of your business deals, from the day that you will make the kinyan, and not before. According to some poskim you should give your father a check for the sum of the original loan, which will essentially pay him back his money, and then he gives it back to you, and you sign the heter iska. This way you canceled the old loan and there is a heter iska from the time of the new loan. I am assuming that there was no interest that was already given to him. Regarding the interest in the bank, you can not give the interest that was gained prior to the date of the heter iska, but only after it. s a side point, it is noteworthy that you should make up, that the profit that you will be giving your father should start from when you are actually getting 10% profit from the loan, and not when the money is only in the bank, otherwise you will be giving him more profit then what you yourself are making. The bank is not giving you 10%.. There are however a few things that I need to clarify;
How was the money borrowed from your father, with a shtar or only verbally?
Also, did you already make a kinyan on the house?
This information may be necessary in regard to the way you will make the clause that the extent of your father’s profit in your business dealing etc. extends only for the time that he is alive. Thanks

Answer:

Correct. What I meant was that you should not give him any interest over what you yourself are making,otherwise it doesn’t look like a partnership, but interest.. However the interest that the bank is giving you is no different that any other profit realized from the deal.

Since the money was already transferred to you, when you make the heter iska, make it with a kinyan sudar. Take your father’s pen, etc. pick it up and say that you are being mechayev yourself with this kinyan, that the money that was already given to you, will become an iska, and any future kinyan that you will make on the house (final payment, etc.) will be  a kinyan for the partnership.

Best wishes