Taking Collateral
Step into the fascinating world of Hebrew synonyms and explore the rich tapestry of linguistic nuances surrounding the concept of "collateral" and the act of "taking a collateral" from a debtor. For those who don’t know, a collateral refers to a valuable asset or property that a borrower pledges to a lender as security for a loan. When one takes a loan, the lender wants to ensure that they have some form of assurance that one will repay the borrowed money. Collateral thus serves as a safety net for the lender, reducing their risk in case the borrower defaults on the loan. If the borrower fails to make loan payments, then the lender has the right to seize the collateral and sell it to recover their losses. In this essay, we delve into the heart of the Hebrew language to unravel the hidden meanings behind the Hebrew terms for “collateral” and the adjacent concept of “taking a collateral,” shedding light on a realm where language and finances intertwine to create a profound web of significance.
The most popular Hebrew word that refers to a “surety for a loan” is mashkon. Although the noun mashkon does not appear anywhere in the Bible, it does make several appearances in the Mishnah (Sheviit 10:2, Bava Metzia 6:7, Shevuot 6:7). Rabbi Eliyahu HaBachur (1469–1549) in Sefer Tishbi explains that the Mishnaic word mashkon is actually a declension of the Biblical Hebrew root SHIN-KAF-NUN (“dwelling,” “settling,” “neighbor”) with an added MEM to its beginning. He explains that maskhon relates to the original sense of this root because the collateral is an item that "dwells" in the house of another (i.e., the creditor) until it can be redeemed (by the debtor).
As HaBachur explains, once the word mashkon was formed, the initial MEM began to be treated as though it were part of the root, hence in Mishnaic Hebrew, the verb for “taking” a collateral or “designating” something as a collateral is le’mashken and its various inflections (Peah 8:8, Sheviit 10:6, Maaser Sheini 1:1, Shekalim 1:3, 1:5, 7:5, Ketubot 11:3, 13:8, Bava Metzia 9:13, Shavuot 7:4, Avodah Zarah 4:5, Arachin 5:6, 6:3, 8:2) — which are obviously related to the noun mashkon. The Mishnaic term mashkon is also the etymological forebear of the Modern Hebrew mashkanta ("mortgage"). [As an aside, the English word mortgage actually has quite a morbid history, as it is derives from the two Old French words mort ("dead," as in the English words mortal, mortician, and mortuary) and gage ("pledge" or "security").]
The verb chaval is another Hebrew term that refers to the act of “taking” a collateral, or security deposit, from one’s debtors. The Torah uses this word when placing certain restrictions on a creditor regarding how he may take a collateral. For example, if a creditor takes a debtor’s blanket as collateral, he must return it to the debtor every night (Ex. 22:25); a creditor may not take a debtor’s millstone (or other utensils necessary for food preparation) as collateral (Deut. 24:6); and a creditor may not take a widow’s clothing as collateral (Deut. 24:17). In all these cases, cognates of chaval is used. All in all, verbs related to chaval in the sense of “taking a collateral” appear 14 times in the Bible (according to Even-Shoshan’s concordance).
All the early lexicographers like Menachem Ibn Saruk, Yonah Ibn Janach, and Radak, understand the term chaval as deriving from the triliteral root CHET-BET-LAMMED. That three-letter combination also gives us words like chevel ("rope"), rav-chovel ("[a ship’s] captain"), chevel (“strip [of land]”), chevel ("a group [of people]"), tachbulah ("guidance"), chavlei ("pains,” “birth pangs"), and chavalah ("damaging/injuring"). While the classical lexicographers see these various meanings as distinct from chaval in the sense of “taking a collateral,” Rabbi Shlomo Pappenheim (1740–1814) sees all of these ideas as interrelated.
The way Rabbi Pappenheim explains it, the core meaning of this triliteral root refers to a “rope.” The person in charge of a seafaring ship’s ropes was called the rav-chovel (literally, “rope-master”), using the word chevel. One of the primary uses of ropes was to serve as a measuring tool, hence the term chevel in the geographical sense of a quantifiable area that can be measured. Likewise, giving proper advice and guidance requires measured thought, hence the word tachbulah.
Additionally, anything measurable is, by definition, limited and therefore not all-encompassing. Because of this, the three-letter root in question gave way to the terms chavlei, which refers to a localized form of pain that does not affect one’s entire body (like birth pangs); and chavalah, which likewise refers to partial damage or injury that is not commensurate with total destruction. In line with this, Rabbi Pappenheim explains that a chevel of people refers to sub-group that only partially reflects a larger grouping of people. It’s like a club within a club.
Finally, Rabbi Pappenheim explains that chaval in the sense of “taking a collateral” is likewise viewed as an act of injuring or damaging one’s debtor by executing a measured incursion into their property in order to sort out a debt. [From more about chevel in the sense of “rope,” see “Learning the Ropes” (June 2023).]
Rabbi Moshe Tedeschi-Ashkenazi (1821–1898) in his work Otzar Nirdafim takes a more prosaic approach to connecting chaval to chevel, explaining that when one takes a collateral from his debtor, it is as though one has pulled his debtor’s property into his own domain by way of a rope. By this approach, the rope is a metaphorical way of referring to the creditor grabbing his debtor’s belongings. Rabbi Tedeschi-Ashkenazi also considers that the verb chaval may be etymologically related to the word chov (“obligation/debt”), as the two words appear side-by-side in Ezek. 18:7.
Likewise, Rabbi Samson Raphael Hirsch (to Ex. 22:25) offers two ways of explaining how the verb chaval relates to the noun chevel: Firstly, he argues that the item that the borrower uses as a security deposit becomes “tethered” to the lender, in the sense that the borrower can no longer sell or otherwise damage that item (which could cause a loss to the lender). Alternatively, Rabbi Hirsch explains that the collateral is a tangible symbol of the borrower’s personal responsibility to fulfill his financial obligations to the lender, and thus it essentially serves to “tie” the borrower to his debt, in the same way that a rope may be used to tie something down.
The word avot as “collateral” appears only four times in the entire Bible — all in Pararshat Ki Teitzei (Deut. 24:10–13). This noun derives from the triliteral root AYIN-BET-TET. A verb form of this root occurs another five times in the Bible, all in the Book of Deuteronomy (Deut. 15:6, 15:8, 24:10). Interestingly, Rashi (Bava Kamma 115a) actually uses the word mashkon to define avot.
There are another two terms which seem to be derivatives of this triliteral root, but have totally different meanings: a verb in Joel 2:7 (which means “to stop”) and a noun avtit in Hab. 2:6 (possibly meaning “thick mud”). Similarly, the term avit in the Mishnah (Bava Metzia 5:7, Keilim 23:2 and Taharot 10:4-5) refers to a “container” used for produce.
Rabbi Tedeschi-Ashkenazi differentiates between the verb of avot and the verb of chaval by postulating that avot implies a bilateral decision between the lender and borrower for a borrower to give the lender some security deposit in order to receive a loan. On the other hand, the term chaval refers to a lender forcibly taking such a deposit from the borrower in order to secure his dues. In this way, chaval denotes a form of financial violence that a lender might commit against his debtor, while avot denotes an amicable agreement that is not being imposed on a debtor totally against his will. Indeed, Rashi (to Ex. 22:25) explicitly writes that chaval implies taking a taking a collateral to pay off a debt when the time of payment has arrived (after the fact), as opposed to taking a collateral at the time of the loan in the first place.
Rabbi Samson Raphael Hirsch (to Ex. 22:25, Deut. 15:6, Ps. 2:3) connects the word avot to the word eved (“slave/servant”), because the first two consonants of both words are the same and the third consonants are interchangeable with one another (TET and DALET). He explains that the defining characteristic of an eved is that he is “tied to down” to his master’s whims and his freedom has been taken away from him. In the same way, avot represents an even more intense form of subservience (shiabud/shibud, which is an inflection of eved in the shaphal verb conjugation scheme) in the way that a borrower has certain financial obligations to his lender. Indeed, the Bible itself already likens a borrower to a lender’s eved (see Prov. 22:7). Additionally, an avot is an item which has been detained by one’s creditor, and the freedom to use it has been taken away from its actual owner. Rabbi Moshe Tedeschi-Ashkenazi also connects avot to eved in the same ways.
Rabbi Hirsch also connects avot to its homonym avot (with a final TAV), which refers to a “thick rope” (see “Learning the Ropes,” cited above) used to tie things down. In that sense, Rabbi Hirsch explains why the verb chaval also refers to the act of “taking a collateral,” as it is the quintessential way that a creditor shows his dominion over his debtor and ties him down like subdued eved.
The Mishnah (Eduyot 8:2) discusses the Halacha of a Jewish girl who was given over to non-Jewish creditors as collateral until her family was able to pay off their debt. The question was whether afterwards, this girl would be allowed to marry a Kohen. In that context, the word used for her being given over as collateral is an inflection of rahan.
Rabbi Gershon Shaul Yom Tov Lipman Heller (1579–1654) differentiates between the terms rahan and mashkon by explaining that a mashkon refers to when a debtor gives his creditor a collateral to guarantee a loan that the debtor already owes the lender. On the other hand, rahan refers a security deposited by a potential borrower into the hands of the potential lender so that the lender will trust him enough to offer him a loan. In other words, mashkon refers to a collateral given after the fact, and rahan refers to one given before or at the time of the actual loan. Rabbi Heller sees this distinction as implicit in Maimonides (Laws of Maaser Sheini 3:18).
Rabbi Hirsch (to Ps. 37:35) connects the word rahan to the word ra’anan (“fresh”) — via the interchangeability of HEY and AYIN — explaining that just as freshness is characterized by continuous moisture in a given plant or flora, so too does rahan refer to a collateral that is continuous, in that it is deposited with the creditor upon the finalization of the loan, remaining there for a long duration, as it is not returned until the loan has been repaid in full.
The Mishnah (Gittin 4:4) uses the term apoteiki (sometimes pronounced apoteka'i or upoteke) in reference to a specific item or property that a lender set aside, or pledged, from which his creditor may collect his debt, should he default on his obligations (see Rashi to Gittin 40b and Ketubot 54a). Rashi (Bava Kamma 11b, Bava Batra 44b) and Sefer Ha’Aruch explain that the word apoteiki is a portmanteau of the Aramaic phrase a'po te'hei ka’i ("upon here, shall you be"); in other words, the word reflects the declaration to one's creditor that he should collect his debt "from here (i.e., this specific item or property)."
Rabbi Eliyahu HaBachur in Metrugaman cites this tradition as well, but notes that actually the word apoteiki is Greek. Indeed, Rabbi Dr. Daniel Sperber in his Dictionary of Greek and Latin Legal Terms in Rabbinic Literature identifies the Mishnaic word in question as a form of the Greek term υποθηκη (hypotheke/hupothḗkē), which literally means "to put down” or "pledge.” This term is built on the hypo- prefix in Greek, which means "down" (fairly common in various English words like hypothesis, hypothetical, hypocritical, hypochondria, hyponym, and more). The Latin equivalent of this Greek word is hypotheca, which gives way to the English word hypothec, which the Merriam-Webster Dictionary defines as “an obligation, right, or security given by contract or by operation of law to a creditor over property of the debtor without transfer ofpossession or title to the creditor.”
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תוס' יו"ט (עדיות ח:ב)
