Is It Ok For A Christian To Settle A Debt For Less Than The Amount Owed?

Given the state of the economy over the past few years, many, many people receive debts they tin lav no longer pay. One of the ways those debts are settled is through negotiations that end amongst the debtor satisfying the debt yesteryear paying less than the full amount owed. Though this has boot the bucket a fairly park exercise, it tin travel gut-wrenching for a Christian. We are required by our faith to pay our obligations, as well as settling a debt for less than the amount owed tin seem un-Christ-similar.

Bankruptcy together with foreclosure may non elicit the same airplane of concern. Though they likewise tin can live seen every bit unholy based on biblical interpretation, they at least withdraw hold got the blessing of the civil government in improver to are legally binding on all parties.

Settling a debt for less than the amount owed, however, is an informal arrangement between you and one or more creditors. Perhaps since it isn’t ruled on by a judge, it’s viewed as a greater sin. But is it?

What does the Bible say nearly repaying debt?

The Bible is quite clear when it comes to paying our debts; consider the next verses:

Let no debt rest outstanding, except the continuing debt to love i some other, for whoever loves others has fulfilled the police push pull. — Romans 13:viii NIV

It is meliorate non to create a vow than to create 1 as good as non fulfill it. — Ecclesiastes five:v NIV

The wicked borrow inward add-on to do non repay, but the righteous give generously; — Psalm 37:21 NIV

There doesn’t seem to be any wiggle room here, does there? In addition to paying our debts inwards total beingness “the right thing to do,” it’minute also a existent practiced Christian gamble to witness. It says nosotros honour our obligations and piece of piece of work to terminal inwards peace with the globe around us.

If you’re inwards a country of affairs correct at inwards i instance of needing to settle ane or more than debts for less than the full amount owed, allow this sense survive a reminder that we should never convey borrowing lightly. The amend course of didactics is to avoid it as much every chip yous tin then that yous aren’t pose inwards positions such every flake this where you lot receive got to create tough choices.

If the selection is betwixt survival as good as paying a debt . . .

Sometimes yous’re between the preverbal “rock together with a hard topographic point” — debt has a way of making that exceed on off (which is why it’sec to live avoided). You may be forced to pick out betwixt honoring a debt inwards improver to supporting your household, but if that’s the instance, the Bible also tells us this:

”Anyone who does non provide for their relatives, besides particularly for their possess household, he has denied the organized faith and is worse than an unbeliever” – 1 Timothy 5:8 NIV

That poetry isn’t specifically around obligation hierarchies, but it does give us unmistakable management as to where our priorities should live. And this is especially true if you lot atomic number 82 continue responsibleness for theme children or elderly or disabled adults; they cannot select tending of themselves together with it falls on you to do it for them. Debt bag-size town becomes a consideration when your obligation to the people inwards your assistance is at stake.

Before you essay a debt settlement, start consider the alternatives.

Keeping the to a higher identify inwards mind, what should you do if you are inwards a province of affairs where debt hamlet needs to be considered?

Pray for guidance.

You’ve incurred a debt that Scripture requires you to repay, but you also have family survival issues and the Bible is clear on that as well. Is there a “biblical” way out? Pray nearly it; pray long and hard. Consult with other believers. You never know what God will open your eyes to or make available to you. You’re in a difficult situation—trust Him for management.

Retirement accounts or other investments.

Do yous hold got retirement accounts or some stock that you could liquidate, or partially liquidate, inwards club to pay your debt? Most people testament suggest against doing either because of potential revenue enhancement consequences, but inward social club to honour paying a debt, you lot may have got to consider ALL assets. Of course of teaching of pedagogy, you entirely desire to convey this route if the revenue enhancement consequences don’t lay you lot inwards a deeper hole than yous are already inward with your debt.

Get an additional income.

The inability to satisfy a debt is often due to curt-term financial difficulties, like a rash of unexpected expenses. Consider getting a part-time job to get over the rough spot. You can even consider starting a side line concern cutting lawns, shoveling snowfall, doing habitation repairs, typing or tutoring.

Though it’s usually one of the first options people consider when they need money, you’d probably be better off avoiding borrowing money from family or friends to pay your debt and instead work these ideas. You may not grip out able to repay your line corporation fellow member or friend for all the same reasons you tin’t pay your creditor, inward add-on to that could add together human human relationship conflict to a debt job.

Note from Bob: If you find yourself in this position, we have partnered with a Christian Debt Management company that works with you to help you better manage your debt rather than settling it. Find out more here.

Debt hamlet should never live used to engage inward strategic default.

Debt settlement should never be used as a backdoor path into strategic default or anything that looks remotely similar it. You engage inwards strategic default when you lot walk away from an obligation when it no longer benefits yous to accolade it. However, failing to pay a debt that you lot could inward fact pay is actually some other form of theft.

Debt little town should alone live undertaken when it’sec a thing of personal financial survival. You’re working out some diversity of debt reduction every bit a way to provide life’moment necessities for yourself inward summation to your loved ones. Any other run of debt hamlet tin live a course of written written report of strategic default. And every flake Christians, that’s non a route we should e'er convey.

If later on considering all of the potential options, you do acquire inward a debt hamlet amongst a creditor, suffer sure that all price are agreed to inwards writing earlier sending the creditor whatever money. Verbal agreements are non enforceable inwards judicature.

This is a tough topographic point out! What are your thoughts on Christians settling their debts for less than what they owe? Leave a comment below!