There may come a time in your life when you will ask or be asked for a loan from a close friend or family member. Handling money with a loved one can be a delicate situation, but fear not, we’ve got some great tips for you.
First things first, make sure you are asking the right person. Avoid petty people who might throw your financial woes in your face later down the road or worse ask you, “Where’s my money?” every time you see them. Also if you know you’re going to be that way to someone who asks you for a loan, save yourself the headache and just say no.
If you’re asking for a loan, make sure you have exhausted all other feasible options first. If you’re being asked for a loan, make sure that your friend has exhausted all of their options first as well.
Get everything in writing, it doesn’t matter if it’s $200 or $2,000. Unfortunately, things can get lost in translation, but if you record everything and have both parties sign it, you’re in much better shape. Plus, if things go left and you end up on Judge Judy, at least you’ll have your receipts in order.
Set up a repayment date and stick to it. Whether you’re paying back in installments or one big lump sum, pay when it’s due and if you can’t, let that person know. Same thing goes if you are awaiting repayment, don’t be pushy but if you haven’t been paid on time speak up and say something about it.
Realize that if you loan out this money, you may never get it back so if you can’t afford to help out don’t. If you’re on the receiving end of this loan, also realize that not pay someone back will result in a deteriorated relationship as well as the possibility of getting sued depending on the seriousness of the loan.
There’s nothing wrong with borrowing money from a friend or helping a friend out when in need, just be sure to be careful of who you choose to deal with in this situation.
Written By: Taylor Johnson