Debt collateral usually consists of something prized by both parties. As a temporary form of payment, something of value is offered to hold or use as a lien until the debt is paid. In the mid-1800s, lenders considered enslaved persons to be prime collateral because their ownership represented wealth.  In many cases, however, lenders exploited these debt arrangements to the detriment of the borrower. Enslaved persons used as collateral were often abused or simply sought for their monetary value. Such was the case with Thomas Phillips, a slave owner pressured to leave his enslaved people behind as a surety for unsettled obligations to a creditor named N. C. Giddings.

By all indications, Phillips was a financially upright man who seemed to take full responsibility for his debt. Phillips voluntarily submitted a trust deed in Elizabeth City County (now the City of Hampton) in 1859 to use two enslaved people as collateral. Although the debt value is not given, one might reasonably assume that the amount was substantial given Phillips’s willingness to place his valuable human property in jeopardy. To make matters worse, heightened tension between the country’s northern and southern sections increased the likelihood that authorities could seize these enslaved people, leaving Phillips with little hope of their return.

Upon executing the deed, Phillips attempted to relocate to Richmond, but N. C. Giddings balked at … read more »