Summa Theologica Part III (Secunda Secundae) Part 122

We must now consider the sin of usury, which is committed in loans: and under this head there are four points of inquiry:

(1) Whether it is a sin to take money as a price for money lent, which is to receive usury?

(2) Whether it is lawful to lend money for any other kind of consideration, by way of payment for the loan?

(3) Whether a man is bound to restore just gains derived from money taken in usury?

(4) Whether it is lawful to borrow money under a condition of usury?

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FIRST ARTICLE [II-II, Q. 78, Art. 1]

Whether It Is a Sin to Take Usury for Money Lent?

Objection 1: It would seem that it is not a sin to take usury for money lent. For no man sins through following the example of Christ.

But Our Lord said of Himself (Luke 19:23): "At My coming I might have exacted it," i.e. the money lent, "with usury." Therefore it is not a sin to take usury for lending money.

Obj. 2: Further, according to Ps. 18:8, "The law of the Lord is unspotted," because, to wit, it forbids sin. Now usury of a kind is allowed in the Divine law, according to Deut. 23:19, 20: "Thou shalt not fenerate to thy brother money, nor corn, nor any other thing, but to the stranger": nay more, it is even promised as a reward for the observance of the Law, according to Deut. 28:12: "Thou shalt fenerate* to many nations, and shalt not borrow of any one."

[*_Faeneraberis_--'Thou shalt lend upon usury.' The Douay version has simply 'lend.' The objection lays stress on the word _faeneraberis:_ hence the necessity of rendering it by 'fenerate.'] Therefore it is not a sin to take usury.

Obj. 3: Further, in human affairs justice is determined by civil laws. Now civil law allows usury to be taken. Therefore it seems to be lawful.

Obj. 4: Further, the counsels are not binding under sin. But, among other counsels we find (Luke 6:35): "Lend, hoping for nothing thereby." Therefore it is not a sin to take usury.

Obj. 5: Further, it does not seem to be in itself sinful to accept a price for doing what one is not bound to do. But one who has money is not bound in every case to lend it to his neighbor. Therefore it is lawful for him sometimes to accept a price for lending it.

Obj. 6: Further, silver made into coins does not differ specifically from silver made into a vessel. But it is lawful to accept a price for the loan of a silver vessel. Therefore it is also lawful to accept a price for the loan of a silver coin. Therefore usury is not in itself a sin.

Obj. 7: Further, anyone may lawfully accept a thing which its owner freely gives him. Now he who accepts the loan, freely gives the usury. Therefore he who lends may lawfully take the usury.

_On the contrary,_ It is written (Ex. 22:25): "If thou lend money to any of thy people that is poor, that dwelleth with thee, thou shalt not be hard upon them as an extortioner, nor oppress them with usuries."

_I answer that,_ To take usury for money lent is unjust in itself, because this is to sell what does not exist, and this evidently leads to inequality which is contrary to justice. In order to make this evident, we must observe that there are certain things the use of which consists in their consumption: thus we consume wine when we use it for drink and we consume wheat when we use it for food. Wherefore in such like things the use of the thing must not be reckoned apart from the thing itself, and whoever is granted the use of the thing, is granted the thing itself and for this reason, to lend things of this kind is to transfer the owners.h.i.+p. Accordingly if a man wanted to sell wine separately from the use of the wine, he would be selling the same thing twice, or he would be selling what does not exist, wherefore he would evidently commit a sin of injustice. In like manner he commits an injustice who lends wine or wheat, and asks for double payment, viz. one, the return of the thing in equal measure, the other, the price of the use, which is called usury.

On the other hand, there are things the use of which does not consist in their consumption: thus to use a house is to dwell in it, not to destroy it. Wherefore in such things both may be granted: for instance, one man may hand over to another the owners.h.i.+p of his house while reserving to himself the use of it for a time, or vice versa, he may grant the use of the house, while retaining the owners.h.i.+p. For this reason a man may lawfully make a charge for the use of his house, and, besides this, revendicate the house from the person to whom he has granted its use, as happens in renting and letting a house.

Now money, according to the Philosopher (Ethic. v, 5; Polit. i, 3) was invented chiefly for the purpose of exchange: and consequently the proper and princ.i.p.al use of money is its consumption or alienation whereby it is sunk in exchange. Hence it is by its very nature unlawful to take payment for the use of money lent, which payment is known as usury: and just as a man is bound to restore other ill-gotten goods, so is he bound to restore the money which he has taken in usury.

Reply Obj. 1: In this pa.s.sage usury must be taken figuratively for the increase of spiritual goods which G.o.d exacts from us, for He wishes us ever to advance in the goods which we receive from Him: and this is for our own profit not for His.

Reply Obj. 2: The Jews were forbidden to take usury from their brethren, i.e. from other Jews. By this we are given to understand that to take usury from any man is evil simply, because we ought to treat every man as our neighbor and brother, especially in the state of the Gospel, whereto all are called. Hence it is said without any distinction in Ps. 14:5: "He that hath not put out his money to usury," and (Ezech. 18:8): "Who hath not taken usury [*Vulg.: 'If a man ... hath not lent upon money, nor taken any increase ... he is just.']." They were permitted, however, to take usury from foreigners, not as though it were lawful, but in order to avoid a greater evil, lest, to wit, through avarice to which they were p.r.o.ne according to Isa. 56:11, they should take usury from the Jews who were wors.h.i.+ppers of G.o.d.

Where we find it promised to them as a reward, "Thou shalt fenerate to many nations," etc., fenerating is to be taken in a broad sense for lending, as in Ecclus. 29:10, where we read: "Many have refused to fenerate, not out of wickedness," i.e. they would not lend.

Accordingly the Jews are promised in reward an abundance of wealth, so that they would be able to lend to others.

Reply Obj. 3: Human laws leave certain things unpunished, on account of the condition of those who are imperfect, and who would be deprived of many advantages, if all sins were strictly forbidden and punishments appointed for them. Wherefore human law has permitted usury, not that it looks upon usury as harmonizing with justice, but lest the advantage of many should be hindered. Hence it is that in civil law [*Inst. II, iv, de Usufructu] it is stated that "those things according to natural reason and civil law which are consumed by being used, do not admit of usufruct," and that "the senate did not (nor could it) appoint a usufruct to such things, but established a quasi-usufruct," namely by permitting usury. Moreover the Philosopher, led by natural reason, says (Polit. i, 3) that "to make money by usury is exceedingly unnatural."

Reply Obj. 4: A man is not always bound to lend, and for this reason it is placed among the counsels. Yet it is a matter of precept not to seek profit by lending: although it may be called a matter of counsel in comparison with the maxims of the Pharisees, who deemed some kinds of usury to be lawful, just as love of one's enemies is a matter of counsel. Or again, He speaks here not of the hope of usurious gain, but of the hope which is put in man. For we ought not to lend or do any good deed through hope in man, but only through hope in G.o.d.

Reply Obj. 5: He that is not bound to lend, may accept repayment for what he has done, but he must not exact more. Now he is repaid according to equality of justice if he is repaid as much as he lent.

Wherefore if he exacts more for the usufruct of a thing which has no other use but the consumption of its substance, he exacts a price of something non-existent: and so his exaction is unjust.

Reply Obj. 6: The princ.i.p.al use of a silver vessel is not its consumption, and so one may lawfully sell its use while retaining one's owners.h.i.+p of it. On the other hand the princ.i.p.al use of silver money is sinking it in exchange, so that it is not lawful to sell its use and at the same time expect the rest.i.tution of the amount lent.

It must be observed, however, that the secondary use of silver vessels may be an exchange, and such use may not be lawfully sold. In like manner there may be some secondary use of silver money; for instance, a man might lend coins for show, or to be used as security.

Reply Obj. 7: He who gives usury does not give it voluntarily simply, but under a certain necessity, in so far as he needs to borrow money which the owner is unwilling to lend without usury.

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SECOND ARTICLE [II-II, Q. 78, Art. 2]

Whether It Is Lawful to Ask for Any Other Kind of Consideration for Money Lent?

Objection 1: It would seem that one may ask for some other kind of consideration for money lent. For everyone may lawfully seek to indemnify himself. Now sometimes a man suffers loss through lending money. Therefore he may lawfully ask for or even exact something else besides the money lent.

Obj. 2: Further, as stated in _Ethic._ v, 5, one is in duty bound by a point of honor, to repay anyone who has done us a favor. Now to lend money to one who is in straits is to do him a favor for which he should be grateful. Therefore the recipient of a loan, is bound by a natural debt to repay something. Now it does not seem unlawful to bind oneself to an obligation of the natural law. Therefore it is not unlawful, in lending money to anyone, to demand some sort of compensation as condition of the loan.

Obj. 3: Further, just as there is real remuneration, so is there verbal remuneration, and remuneration by service, as a gloss says on Isa. 33:15, "Blessed is he that shaketh his hands from all bribes [*Vulg.: 'Which of you shall dwell with everlasting burnings? ...

He that shaketh his hands from all bribes.']." Now it is lawful to accept service or praise from one to whom one has lent money.

Therefore in like manner it is lawful to accept any other kind of remuneration.

Obj. 4: Further, seemingly the relation of gift to gift is the same as of loan to loan. But it is lawful to accept money for money given.

Therefore it is lawful to accept repayment by loan in return for a loan granted.

Obj. 5: Further, the lender, by transferring his owners.h.i.+p of a sum of money removes the money further from himself than he who entrusts it to a merchant or craftsman. Now it is lawful to receive interest for money entrusted to a merchant or craftsman. Therefore it is also lawful to receive interest for money lent.

Obj. 6: Further, a man may accept a pledge for money lent, the use of which pledge he might sell for a price: as when a man mortgages his land or the house wherein he dwells. Therefore it is lawful to receive interest for money lent.

Obj. 7: Further, it sometimes happens that a man raises the price of his goods under guise of loan, or buys another's goods at a low figure; or raises his price through delay in being paid, and lowers his price that he may be paid the sooner. Now in all these cases there seems to be payment for a loan of money: nor does it appear to be manifestly illicit. Therefore it seems to be lawful to expect or exact some consideration for money lent.

_On the contrary,_ Among other conditions requisite in a just man it is stated (Ezech. 18:17) that he "hath not taken usury and increase."

_I answer that,_ According to the Philosopher (Ethic. iv, 1), a thing is reckoned as money "if its value can be measured by money."

Consequently, just as it is a sin against justice, to take money, by tacit or express agreement, in return for lending money or anything else that is consumed by being used, so also is it a like sin, by tacit or express agreement to receive anything whose price can be measured by money. Yet there would be no sin in receiving something of the kind, not as exacting it, nor yet as though it were due on account of some agreement tacit or expressed, but as a gratuity: since, even before lending the money, one could accept a gratuity, nor is one in a worse condition through lending.

On the other hand it is lawful to exact compensation for a loan, in respect of such things as are not appreciated by a measure of money, for instance, benevolence, and love for the lender, and so forth.

Reply Obj. 1: A lender may without sin enter an agreement with the borrower for compensation for the loss he incurs of something he ought to have, for this is not to sell the use of money but to avoid a loss. It may also happen that the borrower avoids a greater loss than the lender incurs, wherefore the borrower may repay the lender with what he has gained. But the lender cannot enter an agreement for compensation, through the fact that he makes no profit out of his money: because he must not sell that which he has not yet and may be prevented in many ways from having.

Reply Obj. 2: Repayment for a favor may be made in two ways. In one way, as a debt of justice; and to such a debt a man may be bound by a fixed contract; and its amount is measured according to the favor received. Wherefore the borrower of money or any such thing the use of which is its consumption is not bound to repay more than he received in loan: and consequently it is against justice if he be obliged to pay back more. In another way a man's obligation to repayment for favor received is based on a debt of friends.h.i.+p, and the nature of this debt depends more on the feeling with which the favor was conferred than on the greatness of the favor itself. This debt does not carry with it a civil obligation, involving a kind of necessity that would exclude the spontaneous nature of such a repayment.

Reply Obj. 3: If a man were, in return for money lent, as though there had been an agreement tacit or expressed, to expect or exact repayment in the shape of some remuneration of service or words, it would be the same as if he expected or exacted some real remuneration, because both can be priced at a money value, as may be seen in the case of those who offer for hire the labor which they exercise by work or by tongue. If on the other hand the remuneration by service or words be given not as an obligation, but as a favor, which is not to be appreciated at a money value, it is lawful to take, exact, and expect it.

Reply Obj. 4: Money cannot be sold for a greater sum than the amount lent, which has to be paid back: nor should the loan be made with a demand or expectation of aught else but of a feeling of benevolence which cannot be priced at a pecuniary value, and which can be the basis of a spontaneous loan. Now the obligation to lend in return at some future time is repugnant to such a feeling, because again an obligation of this kind has its pecuniary value. Consequently it is lawful for the lender to borrow something else at the same time, but it is unlawful for him to bind the borrower to grant him a loan at some future time.

Reply Obj. 5: He who lends money transfers the owners.h.i.+p of the money to the borrower. Hence the borrower holds the money at his own risk and is bound to pay it all back: wherefore the lender must not exact more. On the other hand he that entrusts his money to a merchant or craftsman so as to form a kind of society, does not transfer the owners.h.i.+p of his money to them, for it remains his, so that at his risk the merchant speculates with it, or the craftsman uses it for his craft, and consequently he may lawfully demand as something belonging to him, part of the profits derived from his money.

Reply Obj. 6: If a man in return for money lent to him pledges something that can be valued at a price, the lender must allow for the use of that thing towards the repayment of the loan. Else if he wishes the gratuitous use of that thing in addition to repayment, it is the same as if he took money for lending, and that is usury, unless perhaps it were such a thing as friends are wont to lend to one another gratis, as in the case of the loan of a book.