Part 2: Is Borrowing Money a Biblical Principle?

by | Apr 27, 2021 | Business & Marketplace, Finances

Note: This is the second part of a series. Read the first part here.

Whenever we discuss the issues of borrowing money, there are three particular areas of concern to most of those I address. They desire to know if it is a good decision to co-sign or guarantee someone’s loan. Then I am asked when it is smart to obtain a loan consolidation. The topic of how to get out of debt is always brought up. Therefore, allow me to give my thoughts on these areas of concern.

First, we need to look at the Word of God on co-signing or guaranteeing someone’s loan. Proverbs 17:18 (NLT) says, “It’s poor judgment to guarantee another person’s debt or put up security for a friend.” Here is another verse, Proverbs 22:26: “Don’t agree to guarantee another person’s debt or put up security for someone else. Still another verse, Proverbs 11:15: “There’s danger in putting up security for a stranger’s debt. It’s safer not to guarantee another person’s debt”. I gave you three verses to emphasize how important it is to never co-sign on another person’s loan.

Now I realize some of you are thinking, “My son needed a car, so I had to co-sign for him.” Or “My mother-in-law needed help, so I felt it was necessary to co-sign for her.” I understand how you feel, but there are reasons why the Lord put these instructions in His Word. What if those you co-signed for are not able to make their payments, and they do not tell you they are past due on the payments. Now, you are liable for the payments and possibly the entire loan. In addition, you may have a collection on your credit report. More importantly, this may cause stress on your relationship with your son or mother-in-law.

May I make a suggestion? Instead of co-signing for their loan, you should borrow the money and have them make their payments to you. Or you could loan them the money, and they could pay you directly. There are other options, but never ignore God’s book of instructions when someone needs you to guarantee their loan.

Next, are loan consolidations good or bad? Let me answer that by asking you a few questions. Following the questions are my suggestions. Is the interest rate of the consolidation loan better than the individual loans? If so, it may be OK to consolidate. However, a consolidation loan must have a goal of getting us out of debt. Avoid a loan consolidation if it increases your total debt. Are the payments on the consolidation loan for a longer period of time than your existing loans? If that is the case, you may not want to consolidate. Are you consolidating to get more money, so you can spend more? If so, don’t do it. If you consolidate your loans, pay the largest payment you’re able to make. This will pay the loan off faster and will reduce the amount of interest you pay.

By the way, unless you are operating on a budget and know how much you spend each month, you really don’t know if a consolidation loan would be beneficial. Finally, if at all possible, avoid a consolidation loan if you are required to use your home as collateral. Protect your home equity. This may be difficult. But at least try it before you pledge your home.

My final topic is how to get out of debt. In reality, it’s pretty basic:

— Spend less than you make.

— Pay down your loans as quickly as possible.

— Control your expenses and avoid credit card use unless you are able to pay off the balance every month.

— Prepare a budget of all your expenses for each month for the entire year.

— Determine the differences between wants, needs and desires.

Please don’t think I am being curt with you about getting out of debt. To be debt free requires a change in what caused the debt. Remember this, with few exceptions, the sum total of all our financial decisions in the past has determined where we are financially today.

To access more information about these topics, please listen to Quality Christian Living on the Charisma Podcast Network or check out my website: davidcfriendauthor.com. {eoa}

Read articles like this one and other Spirit-led content in our new platform, CHARISMA PLUS.

CHARISMA NEWSLETTERS

Stay up-to-date with current issues, Christian teachings, entertainment news, videos & more.

The latest breaking Christian news you need to know about as soon as it happens.

Prophetic messages from respected leaders & news of how God is moving throughout the world. 


MORE FROM CHARISMA

The Church Revived: 3 Keys to the Emerging Move of God

The Church Revived: 3 Keys to the Emerging Move of God

During the past two years, I believe the church at large has been in a season of returning to God. Repentance is crucial when it comes to revival. Scripture shows a clear pattern that repentance precedes the outpouring of the Holy Spirit (see Joel 2:12-28 and Acts...

How Divine Wrestling Changes Our Identity

How Divine Wrestling Changes Our Identity

All of us at some point will hit a place of getting the wind knocked out of us. We all experience unexpected detours and times when there seems to be no way out. But there is One who lives in us, the Lord Jesus Christ, who gives us the strength to overcome obstacles....

Spirit-Filled Pastor: How Does God Lead Us Today?

Spirit-Filled Pastor: How Does God Lead Us Today?

Whether it is the Spirit leading or forbidding in the book of Acts, or the Spirit leading throughout Christian history, it’s clear that the leading of the Spirit is important. In the Old Testament, it appears that the Spirit of God could be withdrawn completely from...

Joyce Meyer: Keys to Winning Your Race in Life

Joyce Meyer: Keys to Winning Your Race in Life

Everyone has a race to run. That just means we all have a life to live. The apostle Paul says in Hebrews 12:1 (NIV), “Therefore...let us throw off everything that hinders and the sin that so easily entangles. And let us run with perseverance the race marked out for...

Prophetic Word: The Lord Says, ‘I Am the Consuming Fire’

Prophetic Word: The Lord Says, ‘I Am the Consuming Fire’

God says that during this season, He is turning up the heat, finding the gold and bringing His refining fire. Job makes a powerful statement of faith as he says of the Lord, "When he has tried me, I shall come out as gold." God knew Job's heart and Job knew the heart...

What Is ‘The One Thing’ God Wants From You?

What Is ‘The One Thing’ God Wants From You?

In 1971, I was invited to spend one month in Singapore at a new institute that had been started by John Haggai. It was still in the formative stages then—a place where Asian church leaders would be trained and challenged to witness for Christ. Today, more than 40...

RECENT ARTICLES

Bill Johnson: Reformers Are Arising to Transform Our World for Christ

Throughout history, reformers have lived with the conviction of the superiority of the gospel of Jesus Christ to transform individual lives, communities, and ultimately, nations. Recently I had the...
37 Prayers for the Suffering Persecuted Church

37 Prayers for the Suffering Persecuted Church

It was a Pentecost bloodbath and most Christians never heard about it. More than 50 Christians were killed in one of the deadliest terror attacks on Nigerians this year. Scores of gunmen rushed in to kill Christians in the midst of worship. All told, over 360 million...

The United States: Birthed in Prophetic Symbolism

The United States: Birthed in Prophetic Symbolism

One of the most amazing facts about the Founding Fathers of our nation is this: The one referred to as the "voice" of the revolution (John Adams) and the one referred to as the "pen" of the revolution (Thomas Jefferson) both died on the same day—July 4, 1826—exactly...

Why Did God Give ‘This’ to Me?

Why Did God Give ‘This’ to Me?

It’s a question I frequently hear. It’s one I’ve asked. And maybe it’s one you’ve asked, too. The question is, “God, why did You give this to me?” This can be any number of issues, from emotional or psychological struggles to symptoms or sicknesses, disabilities or...

No Evil Can Stop What God Has Planned

No Evil Can Stop What God Has Planned

I sense it. And I perceive a growing number of people in massive proportions sense the increasing momentum of power and might worldwide. Something is on the horizon—something more eerie and ominous than what the people of the world have ever before experienced. Even...

Pin It on Pinterest