DEBT AND HOME OWNERSHIP
WHAT DOES THE BIBLE SAY ABOUT PURCHASING A HOME WITH BORROWED MONEY?
Key Facts
More U.S. households are renting than at any point in 50 years. [1]
The national homeownership rate is at 65%. [2]
For those adults under 35 years of age, the total average debt is an estimated $67,400. [3]
Key Scriptures
Proverbs 22:7 “The rich rule over the poor, and the borrower is slave to the lender.”
Proverbs 24:3-4 “By wisdom a house is built, and through understanding it is established; through knowledge its rooms are filled with rare and beautiful treasures.”
Romans 13:8 “Let no debt remain outstanding, except the continuing debt to love one another, for whoever loves others has fulfilled the law.”
Psalm 37:21 “The wicked borrow and do not repay, but the righteous give generously.”
Application
Debt is a point of concern for many Christians. While Christians may seek to glorify God in their finances, because of what the Bible says about debt, they may wonder if this excludes them from ever being able to purchase a home short of a 100% down payment. Most home purchases are assumed to be paid with a loan, but it is important to examine how the Bible addresses this issue. While the Bible does not speak directly to the concern of home ownership as it relates to debt, there are biblical principles concerning debt. These principles can help each Christian make wise decisions with finances and home ownership while using our finances to the glory of God (1 Cor. 10:31).
What Does the Bible Say About Debt?
Because the question of debt requires discernment and wisdom, it is no surprise that most of the verses that apply to the question come from books of wisdom literature—Proverbs and Psalms. Proverbs 22:7 shows the cost of indebting oneself to another, saying that the borrower is a slave to the lender. Christians, on the other hand, should seek to be slaves to nothing other than Jesus Christ (Eph. 6:6). Psalm 37:21 reveals that the refusal to pay back a loan is sinful. Christians should avoid participating in every type of evil, which means that the only appropriate time to borrow money is if one knows they can pay the lender back (1 Thes. 5:22).
Based on what the Bible says, is debt sinful? The short answer is: not always. It is not inherently sinful to take out a loan in every circumstance. However, it may be unwise in many instances, and sometimes even sinful. Wisdom is something that Christians have the opportunity to exhibit in all areas of life, including fiscal responsibility.
Should Christians Use Loans to Buy a House?
The passages above show that it is ideal for a person to avoid debt. If a person does take a loan, that money should only be borrowed with assurance that it can and will be repaid quickly and in full. It seems that the Bible does not consider it sinful to borrow money, but whenever a Christian is indebted to someone, it is a priority to pay that money back. Therefore, the cases in which it is wise to borrow money are the exception rather than the rule. Home ownership can be one such exception. One reason is that owning a home can be more financially responsible than renting because it builds wealth and equity.
For Christians, debt is not a way of life. However, in the instance of home ownership, it is nearly impossible for many to afford a home without first entering into debt. In this instance, it is important to be assured that the home loan is taken on as a financial investment more than a burden and will be able to be repaid fully.
Conclusion
Home ownership is a big decision for a Christian that is best done prayerfully and with proper guidance. The Bible cautions us concerning debt. This means that when entering into a home loan (or any other debt), Christians should be diligent in research and assured of their ability to repay the loan. With godly counsel and financial wisdom, Christians can enter into a home loan while being good stewards of the finances God has blessed them with.