Loan Agreements With Family And Friends

You may have bypassed the bank by getting a loan from family or friends, but you should still treat the situation as strictly commercial. The written agreement protects not only both parties, but also your relationship. After all, borrowing money is not the same as lending the car. If someone you know personally needs money and you are able to help them financially, as a generous friend or family member, it can be very tempting to offer this help. While this is certainly commendable, it`s important to think about what will happen if things don`t work out as expected. Even though it is quite clear that the money was presented as a loan and not as a gift, implementation problems can arise if, as a lender, you have not insisted on full compliance.

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