The Prior complains to Locksley of ill treatment by his men, who have torn his fine clothes, and threatened him with harm if he did not turn over his wealth. The drunken Friar talks to the Prior, who is greatly offended by this poor specimen of a priest. He finds no help from the Friar, and tries to talk his way to freedom. But the outlaws decide that the Jew should name the Prior's ransom, and vice versa. Isaac notes how fine the abbey is, and how well the Prior must live there. The Prior blows up at the Jew, complaining about how much of the church's money the Jew takes. Isaac names a sum, and all deem it fair but the Prior, who must now name the price of Isaac's freedom. Isaac offers to get the Prior his ransom money, if only he will let him off. But no, the Prior notes the wealth and usury of Isaac, and is quite offended. Isaac insists he forces no one to borrow money from him, but the Prior still gives him a sentence of a much higher sum than the Jew gave him. Isaac is mortified, and more so when he learns that Rebecca was carried off by Bois-Guilbert. Locksley feels pity for the Jew, and tells him that his ransom can be the same as the Prior's because Isaac will need all of his resources to free Rebecca.
Locksley then arranges a bargain between the Jew and the priest. Because of his pity for Isaac's situation, and because of a kindness Rebecca paid to him, the yeoman asks the Prior to allow Isaac to pay his ransom for him, in exchange for the Prior's help in getting his daughter back from the Templar. Despite some protestations about the sum by Isaac, an agreement is struck, with Locksley promising the Prior he will see that the debt is paid by the Jew. So, the Prior writes a letter to Bois-Guilbert. He then asks for his belongings back, but Locksley refuses to return the rings and other baubles, which he thinks are not meant for men of the cloth. The Friar offers to take them, which angers the Prior.
Locksley requests some security from Isaac, and suggests the key of his money chambers. When Isaac balks, Locksley reminds him of how little his money would mean if his daughter were lost. At the end of all this bargaining, the Black Knight leaves Locksley with a word of friendship and respect.
