EXOD703 As Maimonides notes, a particularly high level of tzedaka is making an interest-free loan to a person in need [this verse and Deuteronomy 23:20-21]. Throughout Jewish history, Jewish communities have set up Free Loan Societies (known as Gemach, from the Hebrew term gemilut chesed, "acts of kindness"), in which loans are given to help people cover basic needs (Such as rent, food, school tuition), and larger sums are extended for broader purposes, such as to help a person start a small business. Such loans "spare the poor embarrassment" (Rashi's commentary on Shabbat 60a).

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EXOD706 If someone needs money, but would be ashamed to receive charity, then find a way to coax her into taking the money as a gift or, if that would also embarrass her, as a loan Ketubot 67b. [While today we think of charity primarily in terms of donations, the Bible--perhaps because it was written at a time when few people had large amounts of money that could be given away--primarily associates charity with interest-free loans. See for example, this verse.] The psychological advantage of a loan-- particularly to someone who used to have money--is obvious: "a dole demeans by the very fact that the recipient is on a level subordinate to that of the donor but, in the case of the loan, both parties are deemed equal" (Byron Sherwin, Jewish Ethics for the Twenty-First Century, 146). Such a loan should, of course, be interest-free.

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EXOD708 It was taught: R. Yishmael says: "If money you lend" -- This ["If money, etc."] is mandatory, [as it may be in Hebrew]. But perhaps it is optional! [This is not so, for] (Deuteronomy 15:8): "and lend you shall lend" indicates that it is mandatory and not optional (Mechilta).

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EXOD714 Gemiluth chesed loans are to be extended to all: man or woman, rich or poor, adults or minors (through their guardian and the like, to prevent the money being lost. Gemiluth chesed with one's person is to be extended to the minor directly). Scripture has stated: "If you will lend money to my people." Whoever is included in the term "my people" is entitled by law to benefit from gemiluth chesed.

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EXOD715 R. Yosef taught: "If money you lend My people, the poor man with you": "My people" and gentiles -- "My people" come first [for the granting of a loan]; a poor man and a rich man -- the poor man comes first; your poor [i.e., those of your family] and the poor of your city -- your poor come first; the poor of your city and the poor of a different city -- the poor of your city come first (Bava Metzia 71a).

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EXOD716 If someone asks us for money or information, we should treat him as we would want someone else to treat us. The words "the poor that are with you," teach that you should look upon yourself as though you were the poor one. (Rashi). If you would need to borrow money from someone, you would dislike it if he acted condescendingly toward you. The Torah tells us to put ourselves in the other person's place and act toward him as we would want him to act toward us.. Rabbi Chayim Shmuelevitz frequently says that the same principle applies to all instances when someone needs to consult another person. If you needed to ask someone for information on any matter, whether Torah knowledge or practical advice, you would want him to act kindly toward you. Act the same way toward others. Don't act in a superior manner to someone who asks you for information. Patiently and humbly answer him to the best of your knowledge. Rabbi Chayim Mordechai Katz, the late Rosh Yeshiva of Telz, used to admonish those students who were reluctant to answer the questions of others. They felt that it was a waste of their time to interrupt their own studies to explain a difficult passage to others. But the Rosh Hayeshiva said that this attitude is improper. If you are able to teach others Torah, you are obligated to do so.

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EXOD717 A lender is forbidden to pressure a borrower who is unable to repay a loan. [author lists seven aspects of this prohibition - AJL]. Rabbi Chayim Shmuelevitz, Rosh Yeshiva of Mir in Jerusalem, said: "We find that both a lender and the borrower have their obligations. The lender must not pressure the borrower and the borrower must pay back on time. If each one would do everything possible to fulfill his own obligation, all would be well. Troubles begin when someone forgets about his own obligation and just worries about the other person fulfilling his obligation."

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EXOD718 Indeed, the amount of money owned by a person in excess of his needs is a trust fund deposited by the Master of the Universe, Who appointed him to administer it, to take pity on the unfortunate and to extend favors to the needy. On [this verse], R. Moshe Alshech has commented: "This is comparable to a person who has deeded all his money to one of his sons. [The law presumes that] he only intended to appoint this son a trustee, since it is reasonable to assume that he would not cut off the rest without anything. Hence the share of each of the other sons is held to be a trust fund kept with him. So in our case. God made one person rich. Is it possible to assume that he has left the rest in penury? Are they not his sons as well? God, then, appointed the rich person a trustee to support the poor, and their share with him exceeds his own portion." This is what the verse (Ibid), "the poor that is with you," conveys: Whatever the poor really needs belongs to him. It is deposited with you on his behalf, therefore you must not withhold it from him.

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EXOD719 One should be aware not to subject the borrower to any indignity, Heaven forbid, but lend to him cheerfully. (See above, chapter 9, where we have explained the matter thoroughly.) He should consider himself. Suppose he wanted to obtain a favor from his neighbor. How ardently would he wish his neighbor to receive him graciously. He should act the same way towards his neighbor. So Rashi has commented on [this verse]: "If you lend money to My people, to the poor that is with you, you shall not treat him disrespectfully when lending him money, since he is "My people." "The poor that is with you"--look at yourself as if you were the poor man.

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EXOD721 Collecting the money owed to him will allow the giver to lend it out again, as the Torah has intimated by [this verse]: "If you take a pledge…" following immediately after "If you lend money to my people…", the implication being, according to the Mechilta (Ibid.) that one should first give the loan and then take a pledge. (The pledge here referred to can only be exacted with the permission of the Beth Din. As pointed out in the Gemara [Bava Metzia 113b], to take a pledge without the authorization of the Beth Din is to transgress the prohibition [Deuteronomy 24:10]: "You shall not go into his house to fetch the pledge." Even to seize a pledge from the debtor in the street is forbidden, as is laid down in Choshen Mishpat, Chap. 97 [q.v.].) This refutes the illusory belief that it would be better for the lender to allow the money not to be repaid, since then he would not be obliged to bother lending it out again. The Torah teaches us proper conduct. It is better to keep claiming the money till it is recovered, and then to lend it out once more.

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