Getting hit up for a loan can make you feel like youre stepping into a minefield.
In todays economy, its easy to understand how someone can find themselves in a dark place financially.
On the one hand, you want to help out a loved one whos in need.
This article originally appeared onLearnVest.
A true friend or relative will be willing to accept no and then thank you for any additional help.
If she doesnt, better that your relationship sours before youve forked over any funds.
But as it turned out, Whites sister appeared to have another idea in mind.
Now shes been working for years, yet she hasnt mentioned anything about payback, says White.
I had no idea we were on a 10-years-and-counting plan.
I wouldnt be upset, but now Im considering some investments and that money would help.
By nailing down this schedule, theres also no mistaking this money as a gift, adds Ellis.
The loanee also cant postpone repayment indefinitely and claim she didnt know you needed it so soon.
As Ellis mentioned above, its also wise to charge interest and work that into your repayment schedule.
Her foresight paid off.
you’re free to draft a simple personal loan agreement without hiring an attorney, Prakash says.
Make it more businesslike, so neither of you feels like youre taking advantage of the other.
Ive attached an original copy, in case youd like to refer to it.
So glad I was able to help my cousin out.
*Names have been changed.
Information shown is for illustrative purposes only and is not intended as investment, legal or tax planning advice.
kindly consult a financial adviser, attorney or tax specialist for advice specific to your financial situation.
Image byJulia Tim(Shutterstock).
