Your Debt to God has Been Paid in Full
But What About Your Debts to Man?

Did you spend too much on Christmas? Perhaps even buying on credit? Many believers did and January brings reminders of this lack of wisdom. Debt is so insidious and satan will use it to destroy our peace. Maybe it isn't Christmas debt that plagues you but something far more disturbing. Please read with empathy this poignant letter we just received:

We are a couple who should know better. I am 52 and my husband is 61. He has a very good reputation as a veterinarian for many years in the community. I have a very good job now.

When we married a little over 9 years ago and since, we did not use good sense in our finances and we find ourselves so completely over our heads in debt that we can't even breathe. I quit my good paying job after I had been there almost 10 years and went into business for myself, it tumbled us more into debt and for 4 years we had no health insurance because we could not afford it, or life insurance.

I was in two serious auto accidents at that time and injured very severely. I did get a settlement which we used to pay off bills, but mounting debts, and interest, along with medical payments and "selfish" interests, we tumbled even more into debt. We want keep our home and our reputations. I was blessed by God in that he gave me back my good paying job and am now working at the same company which I had previously quit, but even with good pay, we can't make it. We have been making payments, barely.

Now I feel suffocated, our marriage and faith is floundering, we feel embarrassed and can't talk to anyone about it. We're too old to have done this terrible thing. We need help very badly. My husband is going to see a bankruptcy attorney in the morning. Right now my bank account is overdrawn and there is no where else to turn.

I feel God will be mad at us and punish us. We have been seeing one of our Pastors for marriage counseling, but I know that isn't going to help, because the debt is our main problem. Neither of us can sleep at night and I am beginning to wish I were dead. I have also had to fight a melanoma which was just found. I have been tithing regularly, but my husband has not been.

Can you give me some peace about this, or some words of wisdom, maybe just some support. I feel so stupid for having done this. God is being squeezed out of our lives because of the worry. Do other professional couples who are not "dumb" ever go bankrupt?

Thank you.

AN AGELESS PATTERN
Can you see what has happened here? This dear couple made a series of small mistakes, each adding to the load of debt and guilt. Meanwhile the enemy brought in emergencies and medical ailments to compound the problem and multiply the debt. As the debt grows, the sense of guilt increases until estrangement from God and each other ensues... a never ending downward spiral! Satan LOVES it!

I am reprinting the March, 1999 article I did on Christians facing bankruptcy because it is such a vitally important subject. Stop the downward spiral. Standing still is tantamount to sliding downhill backwards. Please read with care....

Christians Facing Bankruptcy

In the broadest sense, bankruptcy is a state of having a debt load so large that it cannot be serviced either at present nor in the foreseeable future. The legal definition although weighted with many clauses and other legalese is basically the same but carries with it a variety of remedies: absolution, reorganization or a combination of the two.

Irrespective of the causes, a growing number of Christians find themselves in a state of bankruptcy. Most, however, are determined not to file for legal bankruptcy and herein lies a dilemma. Let me demonstrate with two case histories. First let's forget how these families ended up with such massive debts. We'll discuss some debt traps later in the article, but for now let's focus on ways they handled the situation.

The Smiths had a massive credit card debt which they tried to consolidate with a second mortgage. They also owed more than their two vehicles were worth. Payments for all these creditors totaled almost 90% of their combined income so each month they drew cash advances to buy food and pay utilities, etc. Finally, they had maxed out every card and had no more credit available to them.

Bill collectors were hounding them; judgements were filed against them; their wages were garnisheed. Soon Mrs. Smith lost her job as a paralegal because her employer felt embarrassed by the situation. They sought consumer credit counseling, but their debt load was so great they could not be helped so they were advised to consider bankruptcy. They refused saying that as Christians they could not consider such a thing. Eventually, their cars, home and most furniture were repossessed, yet these did not even cover what was owed on them let alone all the unsecured credit card debt.

Unable to qualify for a rented house or afford the huge utilities deposits, the Smiths now live with relatives. Their relationship has become strained and they are thought of as deadbeats by many of their former friends.

The Johnsons faced similar debt problems and initially tried to cope in the same manner as the Smiths. They tried bill consolidation loans and consumer credit counseling, all to no avail. Then one night as their Bible study group was discussing the Year of Jubilee, Mr. Johnson broke down and tearfully shared his story with the group, confessing that he had not followed Biblical principles on finances and asking for prayer and support.

One member of the Bible study group was an attorney. She invited the Johnsons to come to her office the next day and bring all their financial records. After reviewing all the figures, she explained why the only honorable solution was Chapter 7 bankruptcy. Today the Johnsons still own their home and vehicles and are repaying their debts in a sensible, preplanned way. Here's how and why:

First Things First
Both the Smiths and the Johnsons stopped paying tithing as their financial conditions worsened, but the Johnsons came to realize that the devil attacks us where we're weakest and they were determined not to let their finances drive a wedge between them and their Lord. So, they began to pay the tithes they owed and to make small offerings as the Spirit led.

Sadly, when people face financial trouble, the first thing most do is stop paying their tithing. They make no offerings to the Lord's work, or they give but not cheerfully. Scripture clearly states that all we have is from God. He owns it all! We are to honor that fact with our tithes and offerings. These are but a few scriptures to ponder...

• "each one of you should set aside a sum of money in keeping with his income..." (1 Cor 16:2)
• Each man should give what he has decided in his heart to give, not reluctantly or under compulsion, for God loves a cheerful giver"(2 Cor 9:7)
• ""But seek first His kingdom and His righteousness, and all these things will be added to you." (Mat 6:33)
• "Honor the LORD with your wealth, with the firstfruits of all your crops." (Proverbs 3:9)
• "Give and it shall be given to you; good measure, pressed down, shaken together and running over. shall men give into your bosom." (Luke 6:38)
• "He who sows sparingly shall reap sparingly and he who sows generously shall reap generously." ( 2 Cor 9:6)
• "Your giving not only supplies the wants of the saints but brings forth thanksgiving to God"(2 Cor 9: 12)

Also, in Luke 6:38, Jesus says that as you give, you will receive. Paul tells us in 2 Cor. 9: 10 that the Lord will multiply the resources of the giver as he sows.

So, the first thing Christians need to do is pay tithing! Note, there is a difference between tithes and offerings. Offerings are made as the Lord leads on an individual basis, whereas tithes belong to the Lord and the amount has already been set for us by scripture.

Applying the above Biblical truths, we can see that when we stop paying our tithes and withhold the offerings we are led to make, we help bring about our own financial ruin. For as we sow, so shall we reap. Of course, we cannot fool God! He knows if we are just trying to earn a reward by giving rather than giving out of love and with a joyful heart.

Your Daily Bread
The Johnsons made and carefully followed a sensible budget which allowed for a few "extras" so they wouldn't end up on stress driven spending sprees. Everything beyond that was divided proportionately among their creditors.

Certain needs must be met; food, housing, clothing, etc. Carefully devise a budget for these needs and stick to that budget. Anything left over is available for debt service. Period. You cannot make a wishful commitment of funds you and your family need for everyday living expenses. Now, you can take a realistic look at whether it is at all possible to repay your debts under any plan acceptable to ALL your creditors.

Don't Make Deals
Many creditors, especially credit card companies and other unsecured note holders will offer attractive deals to entice you to pay them in favor of your other creditors. This can come back to haunt you if later you do indeed need to file for bankruptcy. It is legally important (and morally fair) to treat all unsecured creditors equally, showing favoritism to none. Payments to secured creditors should be continued if you plan to keep the secred item(s).

After the Johnson's bankruptcy was final, they made proportionate payments to their unsecured creditors as a matter of moral responsibility even though they know that under their present circumstances, it will take over 20 years to repay everyone.

The Big Decision
If consumer credit counseling cannot work in your case, it is fairly obvious that a repayment schedule acceptable to all your creditors will not be found and you are faced with making a decision about bankruptcy. Reorganization is one form of bankruptcy which is similar to consumer credit counseling in that it sets up a revised schedule of payments. The difference being that the court orders your creditors to accept these reduced payments and there is a time limit. Often, however, the debtor is in so deep, there is no reasonable repayment schedule to be had.

In Chapter 7 bankruptcy, unsecured debts are "forgiven." These creditors then no longer have legal recourse to collect from you. This does not, however, prevent you from voluntarily repaying them a bit at a time after the bankruptcy is finalized as did the Johnsons. As for secured creditors, you have the option of keeping the debt plus the secured item and repaying according to the original note or returning the secured item and declaring the debt null. The secured creditor may refuse to permit this but most do accept it.

Simply put, Chapter 7 allows you to keep a certain dollar amount of many kinds of assets. The excess is to be sold to satisfy your creditors to the extent available. The allowances are fairly generous, including a substantial equity in your home. All unsecured debts and any secured debts you choose are dissolved and you leave the process with a fresh start. At your option, you may later repay any creditor as much as your reasonable budget affords.

Is Bankruptcy Biblical?
No, not really. But then neither is the alternative. Christians are taught to pay the debts they owe. To keep their promises. To be indebted to no man... But we are past that point. Whatever brought you to the situation of needing the relief of bankruptcy is already in the past and cannot now be changed. How you deal with your fiscal dilemma is the issue at hand.

In the Year of Jubilee, all debts were forgiven. This Old Testament concept has been carried over into our modern legal system to afford relief for those hopelessly in debt beyond reasonable remedy. While there are no debtors' prisons in our society, those in debt are most certainly in bondage. Whether they choose to be set free and the manner of their release is a personal choice which must be prayerfully made after a detailed examination of their fiscal circumstances.

Is Bankruptcy a Sin?
Most certainly not. While I know many will differ, I see no sin in filing Chapter 7 or 11 or 13, if that applies. Any sin associated with filing bankruptcy was committed prior to the filing. The Bible is full of financial counsel. If we choose to ignore those teachings and end up in trouble, we need to confess this before the Lord and fully repent. Seeking legal remedy for the situation is not the sin some would claim it is. And what of Christians who, through no fault of their own, end up with an unbearable load of medical debt, or a judgement on an auto accident, or some other unpredictable encumbrance? Many roads can lead to disastrous financial situations.

The devil is a liar and the father of lies. He would have us believe it is more honorable to rob Peter to pay Paul or to spend our days in bondage, trying to outfox bill collectors, dreading to answer the phone or read the mail. No! We must face the truth. If we cannot pay the debts we owe, we must admit that and make positive plans to remedy the situation in an honorable, legal manner.

Jesus came to set us free. He doesn't want our hearts so full of money worries that He is crowded out. "No man can serve two masters...." and if you are buried beneath a mountain of debt, your heart and mind will dwell on it constantly. It is foolish to allow the accuser to convict you when Jesus has not.

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