Bible Study - Re-Finance (2) - Make Arrangements Caustiously - Proverbs 6:1-5; 22:7 - July 24, 2016

Bible Study – Re-Finance (2) – Make Arrangements Cautiously – July 24, 2016

This is lesson two (2) in our series entitled “Re-Finance: Ancient Wisdom for Money Management.”

Our focus scripture is Proverbs 6:1-5; 22:7

Avoid financial obligations that could sink you.

These are wise words. Often, we may have friends or acquaintances who ask us to cosign a note/loan at the bank or some financial institution with them. We trust the person to pay off the note/loan but if they do not, guess who the financial institution will come to for payment? The person cosigning the note/loan is responsible for paying the loan if the person borrowing the money does not. Those who would be cosigners need to ask themselves, if cosigning a loan with a person who cannot get a loan help them or hurt them. Young folks starting out in life may need help in getting started and need to build their credit. Getting money is one thing but paying it back is quite another.

We will study two sides of debt; the person borrowing and the lender or cosigner.

Let’s explore!

Let’s read Proverbs 22:7:

7 The rich rule over the poor, and the borrower is a slave to the lender.

Those who have means/wealth have the upper hand when it comes to having access to the things they need or want. If someone in need comes to the wealthy to help them, the wealthy can dictate the terms to those needing to borrow money. The terms will often reflect the heart of the wealthy combined with the ability of the borrower’s ability to repay the loan. Some unscrupulous lenders may set the terms of repayment such that they know the borrower will default setting up the opportunity for the lender to take the borrower’s collateral or getting him or her as a slave or obtaining one or more of his or her children.

Ancient and today’s wisdom are the same. Do not let yourself get into a situation where you become the borrower. A borrower will become the slave of the rich.

Those of us who have borrowed to own a house focus on getting our house paid off. Until the house loan is marked “paid in full,” we fret until it is paid. So many home owners, in the last few years, have experienced what we know as “under the water loans.” That is their home is worth less than the money they owe on their home. This situation has caused many to go through awful times in their lives including losing their homes and resulting in bad credit. Lenders made it easy for many to purchase homes during the good, boom times but when difficult times came along, they were not as diligent to work with them to keep their homes. The children of these parents witnessed these times and it made a lasting impression on many of them, much like the depression made on many of us who had parents who lived during the Hoover days.

I understand that many millennials do not have credit cards. They use debit cards. It could be that their parents taught them a very important life lesson not to get into debt. Many children saw their parents lose their homes and struggle to pay off debt and often both parents having to work. This is a very important lesson for all of us to keep in mind.

I thought the following, in brackets, copied from page 105 written by Dr. Garrett, professor of Old Testament at the Southern Baptist Theological Seminary as published in Advanced Bible Study, summer, 2016, published by LifeWay, One LifeWay Plaza, Nashville, TN 37234-0175 was very interesting regarding the Israelite's.

[As mentioned, a large number of slaves in Israel were debt slaves. Most of these would not have been foreigners but fellow Israelites. The Bible does not regard slavery as a desirable condition. Normally, the people of Israel called themselves “Israelites” (traditionally, “the children of Israel”). But an Israelite who was a slave was called a “Hebrew,” not an “Israelite.” (Exodus 21:2; Deuteronomy 15:12). The term “Hebrew” was fairly derogative, and it hearkens back to the time when the Israelites were slaves in Egypt (Exodus 2:6-7; 2:11-13; 5:3; 7:16). The idea was that an Israelite who became a slave had gone back to his or her prior condition in Egypt, as if the exodus had never happened. The term was not meant to demean Israelites who fell into slavery but to press upon them the fact that they should do everything possible to avoid slavery.]

A number of years ago, the young people in Germany would save at least 50% of the cost of a house before they would purchase it. In the USA, we make it easy for people to purchase a home with very little down. Purchasing a house is likely the largest expense young people will make in their lifetime, although new automobiles and pickup trucks run a close second.

My wife and I have longtime friends who managed their finances in a much disciplined manner. To my knowledge they only borrowed money to purchase a house. They knew that in time there would be home repair, appliance replacement, auto replacement, etc. They planned for these known occurrences. They set aside each payday a portion of their income to cover these known events. They knew that appliances were designed to last about 7 years. To my knowledge they never purchased a new car. They would purchase a 2-4 year old car and trade it every 2-3 years. That takes discipline and commitment but also puts them in control of their finances.

Ancient wisdom applies today; be careful and thoughtful before borrowing to obtain things that will likely cost you to maintain them once you become the owner e.g. upkeep, taxes, insurance, etc. Plan wisely before you assume debt.

Let’s read Proverbs 6:1-2:

Financial Entanglements

1 My son, if you have put up security for your neighbor or entered into an agreement with a stranger,

2 you have been trapped by the words of your lips- ensnared by the words of your mouth.

The bracketed section is copied from page 107 of the Advanced Bible Study, summer, 2016.

[Proverbs 6:1-5 is a conditional statement in the form of “if X is true, then Y.” The text is in two parts. The first, verses 1-2, is a “protasis.” This is simply the “if” part of the statement. The second, verses 3-5, is an apodosis. This is the “then” part of the statement. In this case, the apodosis is a series of commands. Thus, the whole passage has the structure, “If this is the situation you are in, then you must do the following things.”]

This deals with such financial matters as co-signing loans or using your collateral to secure another person’s loan or purchase. That is you have “put up security” should the person you are cosigning with defaults on the loan. In ancient times, banks as we know them today did not exist but money lenders did exist. It was common that the first person a person in need would contact would be a family/relative member. It seems that Jewish tradition was to take care of family and those living in the same general area e.g. neighbor.  

The reference, my son, did not necessarily refer to blood relations but more likely a term used in teaching a young person. It was a term of endearment and used to connote the importance of what was about to be stated.  It also carries the idea of teaching fellow Jews or those who have placed their faith in the One True GOD, Yahweh regarding the consequence of entering into financial agreements that could come back to haunt you, therefore, be wise. Your neighbor, in this context, is anyone who is your fellow countryman e.g. Jew, relative, friend, neighbor basically a fellow Jew. The stranger often referred to a non-Jew.

Let’s read Proverbs 6:3-5:

3 Do this, then, my son, and free yourself, for you have put yourself in your neighbor's power: Go, humble yourself, and plead with your neighbor.

4 Don't give sleep to your eyes or slumber to your eyelids.

5 Escape like a gazelle from a hunter, like a bird from a fowler's trap.

Verses 3-5 are the apodosis or the “then” which communicates to us what we should do.

Ancient wisdom dictates which is true today; when you realize that you have made a bad deal, and then do not hesitate to get out of it immediately. Many think, “Oh it will work out.” Don’t count on it. We are often coerced in helping another person out but when we have time to think about it and we realize that we have entered into a bad deal, we must move in haste to get out of it. In South Carolina we have a cooling off period of 3 days but I learned that is not true when you purchase a used vehicle.

The key is, once you realize that you have made a bad deal move with great haste to get out of it. That is, go to the person for whom you have either put up your security or cosigned a loan with him or her and ask him or her to let you out of the deal. Then both of you go to the lender and terminate the agreement. Always have a witness or something to show that the deal has been terminated. Document and document!

Recently, we purchased a 60-day money back guaranteed deal. When we received the product it was not what we expected. The tendency is not to take care of it quickly. The good news for us is that we did not hesitate and received our money back. But many businesses promote money back guarantees knowing that most will procrastinate.  

Wisdom comes from GOD. Seek HIS guidance in all matters. HE may allow us to go through a tense time to teach us a lesson. Life is to teach us to seek GOD and to get to know HIM through our relationship with JESUS The CHRIST. Live wisely by seeking the right relationship with JESUS and applying GOD’S wisdom, as led by the Holy Spirits! Blessings!!!