Shmitat Kesafim in the Sabbatical Year

The Torah states: “At the end of every seven years you shall grant a release. And this is the manner of the release: every creditor shall release what he has lent to his fellow. He shall not exact it from his fellow, his brother, for Hashem’s release has been proclaimed.”
This passage contains two commandments:

• A positive commandment: To release loans in the Sabbatical (Shemitah) year.

• A negative commandment: Not to demand repayment from the borrower.

In our times, the commandment of debt cancellation is observed by rabbinic decree, since the biblical obligation applies only when the Jubilee (Yovel) year is observed, which is not practiced today.

Debt cancellation applies only between Jews. It does not apply between a Jew and a non-Jew. Therefore, if a Jew purchases a promissory note from a non-Jew stating that the non-Jew lent money to a Jew, the Sabbatical year does not cancel that debt.

The laws of debt cancellation apply equally to both men and women.

Debt cancellation takes effect only at the end of the Sabbatical year. Thus, a person who lent money may collect the loan throughout the entire Sabbatical year. However, as soon as the new year begins after the Sabbatical year—on the night of Rosh Hashanah—the debt is canceled, and it becomes forbidden to collect it.

Debt cancellation applies only to loans whose repayment date falls before the end of the Sabbatical year. Loans with repayment dates after the Sabbatical year are not canceled. For example, if someone made a five-year loan and its repayment date arrived before or during the Sabbatical year, the loan is canceled immediately at the end of that year. However, if someone made a five-year loan with a repayment date two years after the Sabbatical year, the loan is not canceled. Likewise, if a loan was given in the month of Elul of the Sabbatical year with a repayment date one month after the end of the year, it is not canceled.

At the end of the Sabbatical year, both verbal loans and written loans are canceled.

Only loans without collateral are canceled during the Sabbatical year. Loans secured by collateral are not canceled at the end of the Sabbatical year.

The Sabbatical year cancels only loans, not debts. Therefore, if someone owes money at a grocery store, the Sabbatical year does not cancel that obligation, as it is not considered a loan. Similarly, if a man divorced his wife and obligated himself to pay her ketubah but did not do so until after the Sabbatical year ended, the Sabbatical year does not cancel the ketubah. Likewise, if someone owes money for work performed, or if a court ordered a person to pay another, these obligations are not canceled, since they are considered debts rather than loans.

If someone lent oil, wine, or similar items that are not returned in their original form, and the Sabbatical year passed, the lender may not demand repayment, as this is considered a loan and is canceled by the Sabbatical year.

If someone served as a guarantor for a loan and paid the lender on behalf of the borrower, and the Sabbatical year then ended, the guarantor may not demand repayment from the borrower, as the Sabbatical year cancels the loan.

Anyone who violates these laws and does not cancel loans owed to him transgresses both a positive and a negative commandment. Therefore, it is not appropriate to call such a person to the Torah reading for the portion in Deuteronomy that discusses these laws.