Part II: Yoreh De'ah
Chapter 13b - USURY cont'd
If a borrower gives a lender property as security for a loan the lender
may keep any income produced by the property provided the amount of the
loan is reduced, even if not by the full amount of the income; but such
an arrangement is forbidden if the borrower guarantees that the lender
will not suffer any losses because of the property (172:1, and see 3-4,6).
On transactions in which the lender rents the property back from the
borrower see 164:1-4;172:2.
It is permissible to buy someone's debt for less than its face value and
then to collect the full value provided the buyer is at risk if the debt
cannot be collected; see 173:4-5. On other types of transactions that
involve payments or benefits to a lender see 177:8-10,13-17.
It is permissible to lend someone money or goods for business purposes and
to share in the resulting profits provided the borrower receives some payment
for his efforts in addition to his share in the profits (167:1; see 173:15-16,
18-19 and 177:1-7,12,20-40).
A loan of goods may result in payment of interest if the goods increase in
value and the borrower returns their current value; but such loans are
permitted if they involve only a small quantity of goods, or if the borrower
has access to goods of the same type, or if the goods have an official market
price, or if the monetary value of the goods is specified at the time of
the loan (162:1-5;163:1-3; see 173:6,17).
Advance payment for purchased goods may violate the prohibition against
interest if the price of the goods goes up; it is permitted only if the
goods are nearly ready for delivery or have an official market price or
if the purchaser is at risk of losing his investment (see 173:7-14;175:1-7).
When a violation has occurred the sale is void unless the goods have
already been transferred (175:8).
It is forbidden to charge a significantly higher price for goods in return
for a delay in payment (173:1, and see 177:1); but once a sale has been made
it is permissible to accept a lower price in return for immediate payment
(173:3), to charge a higher price for immediate delivery (173:2), or to pay
a penalty for failure to deliver (see 177:18). Charging a rental fee is
permitted even if the renter is responsible for the value of the rented item
in case of loss; see 176:1-5. On making a rental price or a salary depend
on how soon payment is made see 176:6-8. If a sale is not final but the
price has been paid, under some circumstances the price is regarded as a
loan; see 174.
Shulchan Aruch, Copyright (c) 2000 ProjectGenesis, Inc.