Every seven years we have a Shemitah year. MOst of the laws are agricultural and only affect those living in Israel. But one of the laws of Shemitah has an impact on us living outside of Israel too. It is that
all debts are nullified. This is one of the many laws in the Torah meant to
protect the poor and disadvantaged, affording them a chance to escape from
eternal debt.
“At the end of seven years you
will make a release. And this is the manner of the release; to release the hand
of every creditor from what he lent his friend; he shall not exact from his
friend or his brother, because time of the release for God has arrived.”
(Devarim 15:1-2)
However, this law wasn’t great for
lenders who would never be reimbursed once the Shemitah ended. The rich refused
to loan money during the latter years of the seven-year cycle, refusing the
poor even a temporary opportunity to make ends meet. They began to fulfil the
verse “Beware, lest there be in your heart an unfaithful thought, saying, ‘The
seventh year, the year of release has approached,’ and you will begrudge your
needy brother and not give him, and he will cry out to God against you, and it
will be a sin to you.” (Devarim 15:9)
The wealthy were concerned that
the poor would always rely on the shemitah year to cancel their debts so they
stopped loaning money in the latter years of the shemitah. This caused tremendous hardship on the poor and caused the wealthy to be going against God’s
commandment. Hillel the Elder came up with a wonderful loophole to solve the
problem. The answer was the prozbul (can be pronounced pruzbol or pruzbul).
The prozbul is a legal document
signed in front of the Beit Din or in front of 2 witnesses which technically changes
the status of individual private loans into loans to the public administration.
Loans to the public administration are not nullified by the Shemitah year so the debts
can now be collected after the Shemitah year. The Beit Din can now appoint the
lender to collect the “public funds” owned. This legal loophole benefited both
borrower and lender; because lenders knew their money was safe even following
the Shemitah year, they were likely to loan to the poor.