Loans what to do when Friends and Relatives don’t Pay you Back

So you loaned your friend or relative some money, and they still haven’t paid you back yet. It has been a few months, and you have given plenty of time for the loan to be repaid, and you feel as if it is time that you get your money back, or at least some sort of payment plan in place. You realize that people run into money problems, and if they had money in the first place then they wouldn’t have asked, but what do you when you are getting a raw deal?

First off, what were the terms of the loan? Was there an agreement that the money would be paid back in certain amounts at certain times? Was there an agreement at all that the money would even be paid back? Some people assume that if you wait too long, that the money was just a gift, or not a big deal.

The best thing you can do for yourself is to write a formal agreement between you and your friend or family member. While it may seem like you don’t trust someone when you ask them to sign an agreement, you are really just heading off a fight down the road. If someone doesn’t pay you back, and you really do need that money, it is easier to point to an agreement, as opposed to having to get nasty about it.

If a friend or a family member doesn’t pay you back, or it has been awhile since payments have been made, I would suggest a diplomatic approach to the issue. I borrow money from my mom all the time, and I know I have every intention of paying her back as soon as possible. I don’t want to be a leech on my parents, and have to hit them up for money, and then not pay them back, and then have to ask for more later on.

However, it does bug me when she asks a lot for it. It makes it seem as if she only cares about getting her money back. I am not saying that you shouldn’t pay them back, but if you get harassed a lot for money, it can seem as if you are pressuring a family member, and that doesn’t help the unity among the family.

If a relative or a friend doesn’t pay you back I say you should look at the whole of the situation. Has that person helped you out in the past, or has that person been there for you when you have needed help. Did they hound you for money, or did they just let you pay it back as you could? If this person has been there for you in the past, I say let it slide one time.

If they have been a leech in the past, and always hit you up for cash, maybe you should put your foot down. Don’t lend any more money, or perhaps just cut that person out of your life.