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the bible

Should I Cosign For a Loan?

By //  by Khaleef Crumbley

A friend or family member needs a loan, but their credit score is not high enough (due to terrible or no credit history, or massive credit card debt), or they don’t have a large enough down payment or some other reason. So they come to you and ask you to be a cosigner on their loan.

 

What Does It Mean To Be A Cosigner?

To be a  “cosigner”, simply means that you agree to assume the responsibility of another person’s debt if they are unable to pay it. For example, if you are a cosigner on your brother’s $20k car loan, you have now agreed to pay the bank back that $20k (or whatever is left at the time of default) if your brother is not able to pay it back.

Many people will face this dilemma at one point in their lives. In fact, many people will actually cosign for loans even when they do not feel comfortable doing it. It is usually due to not wanting to be the bad guy, or is sometimes a genuine attempt to help someone. This is often viewed as a way to help out someone in need – such as a responsible, young person who just needs a chance to display or prove their credit worthiness; or a way to assist your child at the beginning of their “independent life”. But is this a wise thing to do?

What Does The Bible Say About Being A Cosigner?

Proverbs 17:18 tells us that,

A man lacking in sense pledges and becomes guarantor in the presence of his neighbor.

Right away we see that the bible describes one who becomes a cosigner on a loan as “senseless“! We can see that it is not a wise thing to make a pledge based on someone else’s ability to pay back a loan.

We also see such council in Proverbs 22:26,

Do not be among those who give pledges, among those who become guarantors for debts.

Not only are we instructed not to cosign for a loan, but we are also shown some of the dangers of doing so… Proverbs 11:15 tells us that:

He who is a guarantor for a stranger will surely suffer for it, but he who hates being a guarantor is secure.

So, we are actually told that we will “surely suffer” if we decide to pledge ourselves for another person’s debt; and that one way to stay secure is to “hate being a guarantor“! Those are very strong words to describe what has become such a common practice today.

Also in Proverbs 20:16 we find these words,

Take his garment when he becomes surety for a stranger; and for foreigners, hold him in pledge.

It was common to pledge a garment as security for a loan, but – according to Exodus 22:26-27 and Deuteronomy 24:10-13 – that garment had to be returned by sundown.

The idea here is that one who is foolish enough to pledge himself for the debt of a stranger will most likely never be paid back; so the one making the loan should demand the cosigner’s garment as security for the loan.

This shows the senseless and unpredictable nature of pledging your possessions or your life based on another person’s ability or willingness to pay their debts.

Also, one question that must be asked is, “Why does this person need a cosigner?”. The most basic reason is that their bank does not believe that they will pay back the loan.

They use their own experience, a few calculations and the potential borrower’s history with loans (usually expressed on their credit report) to make their decision regarding the loan.

When they request a cosigner they are basically saying, “We don’t trust this person to be able to pay us back, but if YOU are willing to take all the risk then we will give him the money!

What Should You Do If You Have Already Become A Cosigner?

Proverbs 6:1-5 gives us additional instruction. This time however, the instruction is given to one who has already pledged himself on behalf of someone else:
My son, if you have become surety for your neighbor, have given a pledge for a stranger
If you have been snared with the words of your mouth, have been caught with the words of your mouth
Do this then, my son, and deliver yourself; Since you have come into the hand of your neighbor; go, humble yourself, and importune your neighbor.
Give no sleep to your eyes, nor slumber to your eyelids;
Deliver yourself like a gazelle from the hunter’s hand and like a bird from the hand of the fowler.

As we can see from the strong language in this passage, it is a serious matter to pledge yourself on behalf of another. This is because you have essentially given up control of something that God has given to you as a stewardship, and have become “snared” by your pledge.

This situation is so serious that you must do everything that you can to free yourself from this arrangement and gain back control of your God-given resources. Look at how strong the language is here; you are told to “deliver yourself” and not to sleep until you have freed yourself (see Proverbs 22:7)! You are to act as a gazelle  or bird that is about to lose their life to the hunter!

So, if you are in this situation, it should be your highest priority to free yourself from this before you “surely suffer” (Proverbs 11:15; cf. Genesis 43:9, Genesis 44:32-33).

What can you do instead if you want to help?

If you still want to help while obeying God’s word regarding cosigning, there are a few things that you still can do.

Give Them An Interest-Free Loan:

If you know the person is in need, this is one way to help them that will honor God. Proverbs 28:8 assures us that,

He who increases his wealth by interest and usury gathers it for him who is gracious to the poor.

According to Deuteronomy 23:19-20, it was against the law for an Israelite to charge interest to fellow Jews (of course, loans were only to be requested in times of extreme need and poverty – not to fund frivolous, sinful spending like we see today), but many violated this command. As we see here, giving someone in need a loan and not charging interest is a way that you can assist the one in need and please God.

Give them the money that they need.

Proverbs 19:17 tells us that,

One who is gracious to a poor man lends to the Lord, and He will repay him for his good deed.

If you are able, giving your money to one in need – and only expecting repayment from the Lord – is another way to assist a brother in need and honor God with your finances.

Final Thoughts:

As mentioned earlier, since the bible teaches that debt is slavery (Proverbs 22:7), borrowing should only be done when one has a basic need that cannot be met by their income. It was usually a short-term loan, and the Israelites were commanded to forgive all debt every seven years (see Deuteronomy 15:1-15).

Much of the borrowing that we see today represents a person’s desire to live above their means, and I do not believe that type of borrowing (or giving) is what God is speaking of. Hopefully, I will have a chance to address this in much detail in a future article.

So overall we see that God is completely against the idea of one becoming a cosigner for the debt of another, even if we are really seeking to be a blessing to someone in need. However, the bible does teach us other ways in which we can assist others.

I mentioned stewardship earlier. I realize that this may not be a term or concept that is familiar to many modern readers, but this is a concept that God expects us all to understand. A steward is one who manages another person’s property, finances or other affairs. Here are several articles that do a good job of describing the concept of stewardship:

  • http://onemoneydesign.com/blog/2010/01/10/what-the-bible-says-about-money-financial-stewardship/
  • http://www.biblemoneymatters.com/2010/04/financial-stewardship-the-forgotten-component.html

I would love to hear your thoughts on cosigning – even better would be your experiences with it. If you have any questions on this or other concepts, please leave your comment below.

photo credit: 4PIZON

Filed Under: Bible, Biblical Finance, Debt Management, Personal Finance Tagged With: bible teaching, bibles, borrowing, car loans, co signing, cosigner, cosigners, credit, credit card debt, credit history, credit score, culture, debt, ethics, finance, God, Loans, proverbs, stewardship, the bible, usury

Heaven!

By //  by Khaleef Crumbley

Each Sunday, I try to post a devotional thought for you to meditate on. Sometimes it will be something out of my own studies and prayers. Other times – like today – it will be from another source.

Earlier today, I posted a great thought on the subject of Hell by James Smith. Please be sure to read that devotion before moving on with this one. Now I will follow that up with a few thoughts about Heaven, also by James Smith, courtesy of Grace Gems:

(James Smith, “HEAVEN!” 1858)

“You have made known to me the path of life; You will fill me with joy in Your presence, with eternal pleasures at Your right hand!” Psalm 16:11

HEAVEN! What is it?

It is . . .
God’s residence,
the Savior’s home,
our Father’s house,
a paradise of pleasure,
a temple of worship, and
the residence of perfect purity and peace!

There . . .
God unveils His glory,
the Savior exhibits His charms,
the angels perform their service, and
the saints are entirely happy with their God.

In Heaven . . .
sin is banished,
holiness is perfected,
life is a continual feast, and
mortality is swallowed up in life!

From Heaven . . .
all pain is banished,
all enemies are excluded, and
all causes of sorrow are shut out!

In Heaven . . .
all our prayers are answered,
all our desires are gratified, and
all our needs are supplied.
There is no weeping, wailing, or wishing there.

In Heaven . . .
our knowledge will be perfect,
our happiness will be abiding,
our pleasures will be ever new.

In Heaven we shall . . .
see Jesus,
be with Jesus, and
be like Jesus, forever!

Who are there?
All tried and tempted followers of Jesus are there.
All doubting and fearing disciples of Jesus are there.
All poor and despised believers are there.
Multitudes, who felt totally unworthy of such glory, and feared they would never reach the place–are there.

All who were chosen by the Father,
all who were redeemed by the Son, and
all who were sanctified by the Holy Spirit–are there.

What do they enjoy there? Who can answer this question–but one who has been there; and he would need a new language to state, and new figures to represent the enjoyments of Heaven. They enjoy rest from their pains–and a full supply of all their needs. They enjoy perfect satisfaction, a fullness of joy, and pleasure forevermore. They see all that they believed, realize all that they hoped for, and possess all that they loved. They have . . .
health–without sickness;
pleasure–without pain;
and holiness–without sin.
Every sense is gratified, every power is pleasurably employed–and they are perfectly and perpetually happy!

O Heaven, in you there is . . .
no tempting devil,
no ensnaring world,
no indwelling corruption;
no doubts, fears, or misgivings!
And best of all, there is no sin!

O Heaven, in you I shall see my God, possess my Savior, and enjoy the fullness of the Holy Spirit! O my God, in Heaven I shall be satisfied–for I shall be with You, serving and enjoying You without weariness or cessation!

Who will yet get to Heaven? Who? Ah, perhaps many we little think of! We shall miss many whom we expected to find there–and find many whom we never expected would reach that glorious place!

Who will go to Heaven? That poor man who is striving against sin, mourning over corruption, and loathing himself before God. That poor woman, who sighs because she sins, pants for perfect holiness, and clings to the cross of Jesus.

Do you see that poor soul on his knees, confessing his transgressions, pleading for pardon, and seeking grace to sanctify his nature–he will go to Heaven. Do you see that lowly Christian, who is visiting the sick, pointing sufferers to the cross, and trying to alleviate human woe, out of love to Jesus–he will go to Heaven.

Do you see that Sunday School teacher, who, after a hard week’s work, is regularly in his class, speaking loving words, in tender tones, to win the little ones for the Savior–he will go to Heaven. Do you see that preacher who exalts Christ in his ministry, honors the gospel in his life, and travails in birth for souls–he will go to Heaven.

Heaven will be peopled by all who believe in Jesus, love the brethren, and worship God in Spirit and in truth. There will be a numberless multitude there, all deeply indebted to free mercy, washed in the Savior’s blood, and sanctified by the Spirit’s grace!

Reader, there is a way–but only one way to Heaven! Only those found in that way will ever reach it! You yourself, may be within an hour or two of either Heaven or Hell–do you know which? If called away suddenly–to which would you go? You have a Heaven to obtain, or a Hell to endure–to all eternity! Which shall it be? O that you were wise, that you properly realized this, that you would consider your latter end!

Heaven with all its glories–or Hell with all its horrors–must be your eternal portion! If you despise the Savior, make light of the Gospel, and neglect God’s great salvation–then Hell, an eternal Hell, with all its unspeakable horrors–is your portion!

“No eye has seen, no ear has heard, and no mind has imagined–what God has prepared for those who love Him!” 1 Corinthians 2:9

photo by plindberg

***

I pray that these two posts have given you a lot to think about concerning the destination of your soul upon death! Hebrews 9:27-28 tells us:

And inasmuch as it is appointed for men to die once and after this comes judgment, so Christ also, having been offered once to bear the sins of many, will appear a second time for salvation without reference to sin, to those who eagerly await Him.

There will be no purgatory, no reincarnation, and no second chances.

There will also be no excuses! Hebrews 2:1-3a says:

For this reason we must pay much closer attention to what we have heard, so that we do not drift away from it. For if the word spoken through angels proved unalterable, and every transgression and disobedience received a just penalty, how will we escape if we neglect so great a salvation?

So please, “Seek the LORD while He may be found; call upon Him while He is near.” ~ Isaiah 55:6

If you have any questions about the subject, read about the Gospel or contact me.

Filed Under: Bible, Devotion Tagged With: bibles, christian eschatology, christian soteriology, christian theology, christianity, divine grace, God, heaven, hell, holy spirit, james smith, Jesus, life after death, purgatory, salvation, sin, the bible, theology, truth

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