Mechiloh

Question:

A friend borrowed some money and I have a signed document to prove it. I have decided to forgo the debt and let my friend keep it as a monetary gift. I have drafted a letter and wish to deliver it:

Dear Friend,

I have decided to waive my right to collect the loan from you. I hereby declare that as of now I relinquish any right I had to claim the debt you owe me.

Is such a letter necessary in order to effect mechiloh? Is it sufficient to make a mental note that I forgo the loan? Is it enough to articulate my thought and let him know without a formal letter? Please advise.

Answer:

The correct way to forgive this loan is by returning the signed document proving the loan and producing a written document of mechiloh that you then deliver to your friend. The letter you drafted is satisfactory. Even though you did not use the term mechiloh explicitly, as long as you made it clear that you are forgiving the debt and acknowledged that you have no claim against the debtor, it is considered mechiloh.[1]

You should add the date of the loan and the date of the mechiloh. Dating the letter is sufficient. Otherwise, the letter could technically be used for any future loan you might give your friend. (It would be an unlawful use of the letter but your “friend” could get away with it.)

Selected Laws Regarding Mechiloh

1. Mechiloh done through a signed letter is enforceable. Your friend (the debtor) can produce the letter if necessary and will not be required to repay the loan. Once he receives the letter, you can never claim the money from him. It is as if he had repaid the loan. Mechiloh of part of the loan is as if part of the loan were repaid.[2] An extension of the due date of a debt is a form of mechiloh and is binding.[3]
2. A mental decision to forgive a debt (when no letter of mechiloh is given) is referred to as mechiloh balev. It is questionable whether or not the debt remains afterwards.[4] Therefore one should not rely on mechiloh balev as a valid mechiloh.
3. If the mechiloh was verbalized (even without a written letter), it is a legitimate mechiloh.[5] However, should the creditor have a shetar (document signed by witnesses or by the debtor that can be used in beis din as proof of the loan), it is questionable whether mechiloh bapeh (verbal mechiloh) is sufficient.[6] Therefore, if you still have such a shetar from the loan, you should not rely on mechiloh bapeh if you want the mechiloh to be enforceable according to all opinions. The shetar should be returned and verbal mechiloh should be given. Returning the shetar (or check) does not annul the loan, but it turns the milveh beshtar into a milveh al peh, at which point verbal mechiloh is sufficient.
4. Conditional mechiloh is invalid.[7]
5. If a condition was made at the time of a transaction (sale or loan) according to which one party could not be mochel, the condition is not binding and he may subsequently be mochel.[8]
6. 6. Mechiloh on a debt that has not yet been incurred can be retracted.[9]

Therefore, it is always important to receive a written, unconditional letter of mechiloh together with any shetar proving the loan in order to ensure that the mechiloh will be binding. You, as the mochel in this case, should deliver the written mechiloh that you drafted together with the shetar. Just add the date of the mechiloh,as I mentioned above.

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ואם רוצים להקדים הזמן, נראה דצריך קנין. ואם לא קבעו זמן להלואה, והשתא רוצים לקבוע זמן, עיין פרישה סימן ע''ג ס''ק י''ח דקצת משמע דלא שייך קביעת זמן לאחר ההלואה. ומסברא היה נראה דמהני ע''י קנין דיש בזה גם מחילה שמרחיב לו הזמן וגם יש בזה הקדמה.