Q&A from the Bais HaVaad Halacha Hotline

Deposit Slip

December 4, 2025

Q My partner in a real estate business asked me to provide the funds for a deposit on a property, which I obtained from my personal line of credit. We agreed that he would reimburse me for the interest I have to pay. Is there a ribbis problem here?

A Your deposit was actually a loan to the business, so it constitutes a halva’ah beribbis, even though your intention was only to recover the interest you pay and you are making no profit (see Igros Moshe Y.D. 3:93). In this arrangement, the liability for the loan is shared by all partners in the business, so you are the lender and your partner is one of the borrowers, which makes the interest payments forbidden.

One might object that this is not a loan at all, because the funds are deposited not into the business’s account but into the title company’s escrow account. This is incorrect, however, because the escrow account is in the name of the purchaser identified in the purchase contract, which is not you but the business. Although the title company’s records may show you as the source of the funds because you wired the money from your own account, the money is designated as belonging to the legal buyer of the property, which is the business.

For any interest that has already accrued, you might be able to rely on R’ Moshe Feinstein (Igros Moshe Y.D. 2:63), who permits lending to an LLC with interest, as the LLC’s members aren’t personally liable. But most poskim do not rely on this heter (see the comprehensive list in Sefer Mishnas Ribbis 2:6). Also, in this case there might be implied personal liability for your partner, depending on how he communicated the request. Therefore, you must immediately sign a heter iska to prevent an issur when interest accrues from now on.