Is It Ever Okay to Have Debt? A Biblical Perspective

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Debt is an ever-present reality in modern life. From student loans to mortgages, credit cards to car payments, few people live entirely debt-free. For Christians seeking to live according to biblical principles, this raises an important question: What does the Bible say about debt?

Debt In the Bible

The Bible talks a great deal about debt in various forms. There are many examples and illustrations across Scripture that can help us paint a picture of how to think about debt.

One of the first references to debt is in Exodus 22, just two chapters after the 10 Commandments were given, “If you lend money to one of my people among you who is needy, do not treat it like a business deal; charge no interest. If you take your neighbor’s cloak as a pledge, return it by sunset, because that cloak is the only covering your neighbor has. What else can they sleep in?”

God commanded Israelites to be compassionate to the needy by not charging interest and even going so far as returning their pledged asset if they need it. This verse mirrors God’s intention about money throughout the whole Bible in that it’s not about the debt – it’s about the heart and God’s plan for you.

Debt is Not Immoral, But It Can Be Unwise

The Bible does not explicitly call debt a sin. There are no verses that categorically forbid borrowing.

However, Scripture consistently portrays debt as something that should be approached with caution. It is easy for debts to spiral out of control and create hardship unless approached with care.

Proverbs 22:7, “The rich rule over the poor, and the borrower is slave to the lender.”

When you take on debt you are obligating yourself to commitments that impact not just this year but for all of the years in the contract. With commitments come limitations that can impact what you are capable of doing in the future including following God’s calling in your life.

God recognized the downsides of debt and addressed it through regular forgiveness. In Deuteronomy 15, God commanded the cancellation of debt every seven years.

How to be Biblically Wise with Debt

Plan Carefully Before Taking On Debt

Proverbs 21:5 warns, “The plans of the diligent lead to profit as surely as haste leads to poverty.”

Jesus states in Luke 14 illustrates a wise person sitting down to “count the cost” before building a tower illustrating the importance of planning. And while Scripture reminds us in James 4 that we do not know what tomorrow holds, we should ensure that we have a plan to repay the debt.

Proverbs 22:26–27, “Do not be one who shakes hands in pledge or puts up security for debts; if you lack the means to pay, your very bed will be snatched from under you.”

Part of the planning process is understanding how debt works. You should know how mortgages, credit cards, and student loans work before taking them on. Understand how interest rates applied over time can increase the cost of something significantly.

Do Everything You Can to Ensure You Repay the Debt

Romans 13:7–8, “Give to everyone what you owe them: If you owe taxes, pay taxes; if revenue, then revenue; if respect, then respect; if honor, then honor.
Let no debt remain outstanding, except the continuing debt to love one another.”

The Bible warns in multiple places that we should do everything to in our power to repay out debts.

Psalm 37:21, “The wicked borrow and do not repay, but the righteous give generously.”

Be Cautious Taking on Debt for Others

Proverbs 17:18 cautions, “One who has no sense shakes hands in pledge and puts up security for a neighbor.”

Taking on debt for other people is often a bad idea as you are assuming a commitment for someone else who no longer it bound by the terms. They could avoid their responsibilities to you and leave you in a financially difficult situation.

This is debt principal is where the oft quoted Proverbs 6:1-5 passage is applied, “Save yourself like a gazelle from the hand of the hunter, like a bird from the hand of the fowler”

Include God in the Decision

As Christians, we should consistently invite God into our lives through prayer and that is still true with debt. Pray about your decision to take on debt and ask for wisdom.

Prayer for Someone Considering Taking on Debt
Lord, give me wisdom as I consider taking on this debt. Help me to weigh the cost carefully, to seek godly counsel, and to make decisions that reflect trust in You—not fear or pressure. Keep me from impulsive choices, and guide me toward paths that lead to freedom, generosity, and faithfulness. I entrust this decision to You. Amen.

Is Declaring Bankruptcy a Sin?

There is often a lot of shame around bankruptcy, but bankruptcy is a legal remedy—not a moral failing.

If someone:

Took debt with honest intent to repay
Made faithful efforts to meet obligations
Was overwhelmed by unforeseen hardship, illness, job loss, or business failure
And pursued bankruptcy through lawful and ethical means

Then they are not sinning—they are acting within the bounds of both legal and biblical frameworks for mercy and protection.

Scripture constantly reminds us that our worth is not based on wealth, and our redemption is not based on a balance sheet.

Psalm 103:10: “He does not treat us as our sins deserve or repay us according to our iniquities.”

Romans 8:1: “Therefore, there is now no condemnation for those who are in Christ Jesus.”

God is not tallying up your credit score—He’s looking at your heart.

Today’s lending system anticipates risk. Credit cards, personal loans, and even mortgages build higher interest rates and lending criteria based on the possibility that some borrowers will default.

In other words: the lender knows the risk when the loan is issued. This makes bankruptcy not an unexpected betrayal of the system, but a known possibility within it.

However, intentionally abusing bankruptcy can be a heart issue.

Prayer for Someone Struggling Under the Weight of Debt
Father, I feel overwhelmed by the burden of debt. It clouds my peace and drains my hope. But I know You are not only a God of justice—you are a God of mercy and restoration. Help me take wise steps toward freedom. Provide for my needs, soften the hearts of those I owe, and surround me with support. Above all, remind me that my worth is not measured by money, but by Your love. Amen.

Debt and Biblical Stewardship

Debt in the Bible is never treated lightly—but it is also never without hope. Scripture calls us to be wise, humble, and intentional in our financial lives, recognizing that all we have ultimately belongs to God. Stewardship means managing resources in a way that honors Him—whether through avoiding unnecessary debt, faithfully repaying what we owe, or generously releasing others from what they owe us. The Bible invites us to seek freedom over bondage, integrity over impulse, and grace over greed. Whether we are borrowing, lending, or recovering from financial hardship, God’s Word offers both practical wisdom and spiritual comfort. At the heart of biblical stewardship is the truth that God is our provider, our redeemer, and our guide—even in the most complex financial decisions.

This article is part of a broader series about Biblical Money. Read more here: What the Bible Says about Money – Gilbert Wealth