What You Need to Know When Lending Money to Family and Friends
It is lending money that you are able to see some people will be doing. If it is friends and family that will be borrowing money then it is this one that can be different. And for you to be guided on how it is done then read on this article.
You need to pretend that the loan that you have given is a gift. Getting unpaid is a thing that some loans from friends and family will become. And that is why to save yourself from anger and disappointment then you will need to have this mindset.
Charging an interest is also another thing that you will need to do. It is this one that you are doing to help them. It is during the repayment that you don’t need to discount this one.
Drawing up an official agreement is also a thing that you will need to do. You need to see to it that you will have negotiable instruments . Whenever it is this one is what you are able to do then you can avoid any argument later on.
IIt is money that you should not lend the borrower once you think that you are enabling them. If the family or friend that you have is financially irresponsible then lending them money will only make them more irresponsible.
It is you that will have to say no to loans that will have no due date. When providing loans then it is important that you will know when it will be repaid. And once you will not set any due date then the repayment will be the last priority of the borrower.
Not losing sight of the relationship is also another thing that you will need to do. You need to remember that relationship is important with your friends and family. And that is why it is important that you will not be losing sight of it. It is the relationship that you have that is more important than money.
Another thing that you can also do is to find other ways to help. Before lending them money then see if there are any other options available. You need to remember that lending them money should be your last option. Looking at any other option first is a thing that you will need to do.
Lending then money more than you can afford is a thing that you should not be doing. The is always a possibility that you will not be getting the money that you have lent. See to it that you will not be lending them money more than you can live without. Looking at the finances that you have is a thing that you should be doing first before lending anyone money.