The easiest way to turn your friend into an enemy is to lend him money. Mark Twain aptly put it as thus, “The holy passion of friendship is so sweet and steady and loyal and enduring in nature that it will last through a whole lifetime, if not asked to lend money.”
While many would count the downfalls of lending money to a friend and recommend not doing so, adverse circumstances such as a layoff, health predicament, annulment, death or new business venture might result in a friend asking for money.
Lending money to a friend can no doubt complicate a relationship, so there are a few ground rules one should follow before saying yes.
Needless to say, you should first figure out if you can comfortably afford to lend the money. The amount lent should not put you in a financial mess, if it is not returned. Ideally, you should think of the loan to a friend as a donation to a worthy cause.
A small loan of a few hundred dollars may require only a handshake; however in case of higher denomination loans, Communication and documentation are essential. It is important that everything is put in black and white.
When documenting a loan, you should make everything crystal clear. The names of the lender and the borrower; the date of the loan; the amount of the loan; the interest rate, if applicable; the period over which the loan will be repaid; the amount of each payment and the frequency of payments should be clearly stated. There is no harm in involving the lawyers before signing the agreement. By doing this, the transaction becomes more businesslike and bestows a legal obligation on your friend to repay the money.
At times it may just be better to say NO, howsoever difficult it may be to say so. If you are financially unable or uncomfortable to lend money to a friend, it is important to be honest. There is no point in lending money to someone who does not have the ability to pay you back. That in any case would spoil the friendship and would leave you poorer. In case your finances don’t permit to lend, you could offer to help your friend explore other options for getting the money.
If you agree to the loan, avoid being intrusive in your friend's pecuniary affairs. Do not offer unsolicited advice. Finally, do not publicize the fact that you are lending the money. Friendship is a treasure in itself. Do not let money come in friendship. If, for some reason it does, follow the aforesaid simple rules and help your friend in the time of a financial crisis. After all, you don’t want to be called a fair weather friend.
.cAsh!!!.
What was written is absolutely right! If you wish you had the kind of excess cash where you actually had money to lend for once, there are these lenders everywhere. Unfortunately, when people look for money to lend, they usually mean money they can borrow – a money loan, and often times most people just need a small loan that will tide them over until payday. Such loans exist – they're called payday loans, and there are plenty of payday lenders out there that can assist you, and get you the temporary financing you need. Since lenders have joined the modern era, there are online lenders that can wire you funds with direct deposit, as they can get you money loans and have the money to lend. And since you’ll benefit from the money you’ll lend, you should also keep in mind that this is accompanied with responsibility.
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