Has a friend or family member asked you for a loan recently? Lending money to friends and family is becoming more common, but there are pitfalls.
Watch this 5:41 video from MSNBC for tips on how to turn down the loan, offer other types of help, or create a contract for the loan.
March 12th, 2009 at 12:51 pm
Loaning money to friends or family has the potential to put a heavy strain on the relationship.
You may put yourself in a position of having to choose your money or your friendship.
I try to consider “loans” to family members a gifts. If the receiver gets back on their feet and pays me back, that’s a nice treat. Or maybe they’ll be in a position to help someone else down the road. I can’t make the “loan” if I wouldn’t be willing to give it as a gift.
I still have a pile of unpaid IOU’s from my sister from when I was 10. She signed the promissory notes, but how was I going to collect?
March 12th, 2009 at 12:52 pm
That is hilarious. You still have IOU’s from your sister but never made her pay up? Ha!
March 13th, 2009 at 12:07 pm
“Loan” only what you can afford to lose. People “loaned” me money and I have never been able to repay, but I still have friends. I loan to others, as much as I can, and dont expect to get it in return. If I cant afford to “give it away” I decline the request for a “loan”.
March 13th, 2009 at 3:05 pm
No, don’t do it! I worked with a lady, we became good friends, she asked me if she could borrow $500.00 and said she would pay in back in 2 weeks. She ended up moving to TX, never told me she was moving, I heard it through a mutual friend. After several calls to her, she had a hundred different excuses, (lies) about the money being “in the mail, sending it Western Union, etc., etc., etc. It’s been almost a year and a half, still not a dime. Now I call and she never answers her cell phone and her home number is no longer in service. In a certified letter to her, telling her I would have no other choice then to take her to small claims court, I have not done this yet because of the “nice” person I am. Times are tough right now and I sure could use that 500 bucks I’ve lost. I will never ever as long as I live loan a friend a single dime.
March 13th, 2009 at 7:48 pm
My brother loaned me $3000 back in 1974 to buy a house. I paid him back and happily enjoy the house. Except for his trust and generosity I never would have purchased a home.
March 13th, 2009 at 9:33 pm
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