Sunday, July 05, 2009

Can you Pay Someone to be a Cosigner for a Loan?

by: Reb Avi Lebowitz

There is a disagreement between the Taz (170:3) and Nekudas Hakesef whether one can hire someone to be a cosigner on a loan where the cosigner has full responsibility as much as the borrower himself (areiv shluf dotz).

The Chochmas Adam in his sefer Binas Adam (sha'ar mishpat tzedek 2) points out that this discussion took place before the Ritva on Bava Metzia was accessible. However, now that it is accessible, the answer is resolved. Rava had stated that Reuven may pay Shimon to go convince Levi to lend money to Reuven because Reuven is only paying Shimon for s’char amirah (payment for talking). The Ritva asks: Why does the Gemora need to permit it based on this rationale, it should be permitted anyway based on the other rationale that the Gemora suggests that the Torah only forbids interest that is paid directly from the borrower to the lender? The Ritva answer that we are referring to a case where Levi refuses to lend money to Reuven, but is willing to lend it to Shimon, who then goes and lends it to Reuven. Even though it emerges that, technically, Shimon is the one who lends to Reuven and therefore when Reuven pays him, it is ribbis that is paid from the borrower to the lender; it is nonetheless permitted since it is only s’char amirah.

The Binas Adam learns from the Ritva that it is only is a situation where Reuven doesn't request of Shimon to be an areiv shluf dotz; rather Shimon decides on his own to borrow from Levi and lend it to Reuven. But, if Reuven would be paying Shimon to be such a high level guarantor, it is as if he were hiring Shimon to borrow from Levi and then lend to him, which would constitute a prohibition of paying ribbis, since it is no longer just s’char amirah.