To loan money or not to loan money?

It is always difficult to make this decision: to loan money or not to loan money . And it is often very difficult to turn your back on a family member or close friend who needs financial assistance, especially if there are no other alternatives available to them. In this post we will see some points that you should think about before deciding to lend money. This is all you need to know.

Do not rush to lend money

Don't be in a rush to transfer money or withdraw cash from an ATM and give it to the person asking for it that easily. First seriously consider all possible options. The consequences can be the most unpredictable and even your relationship with this person who has asked you for money can change dramatically. Remember that it is safe to lend money only when this debt is duly justified in writing . The documents must confirm the agreement by both parties on the transfer of the money in debt. The conditions of the transfer, the return period, etc. must also be recorded.

The money-back guarantee does not exist

There are no absolute guarantees that the person to whom you are going to lend the money will pay it back. Of course, if you have a paper agreement (a contract), you can go to court if the return does not occur, but this is an additional waste of time, effort and money. With all that in mind, you can agree to only lend the amounts that will not hurt your budget and that you can easily afford. California payday loans

How to claim the money

If the debt has not been paid on time, you must claim it by speaking transparently about the situation: you loaned a certain amount with a specific repayment term. Dealing with the issue will be difficult depending on the situation and the relationship with the borrower, but it is important to claim payment.

How to reject a request

If you've already granted him a loan once, then the other person may feel that you are in good financial standing. It can start to come to you periodically over and over again, until it reaches the point that, without returning an amount, it asks you for a new one. It is important to learn to reject it , otherwise they will see you as an additional source of money.

Risk the relationship

If someone came to you because they needed money and you have a strong relationship with that person, think twice before agreeing. Both parties will lose much less if a loan is simply rejected, citing lack of money or another reason. If the person you trust does not return your money on time, you will remember it forever and nothing will ever be the same in the relationship .

Make the loan official

If you decide to lend a significant amount to someone, be sure to complete two documents:

- Agreement or loan contract signed by both parties.

- Receipt of the money transfer.

Ideally, the documents should be certified by a notary , so that they have truth in front of a court if necessary. If for some reason you do not decide to lend money to that person who comes to you to help them in the face of an economic difficulty, you can advise them to go to other sources, such as Kredito24 or other online financial companies, where they can request an urgent loan if they comply the requirements to obtain it.