BoB will explain to you the fine art of lending money.
Loan money but get it back!
The end line of loaning money is getting it back. When someone asks you for a loan, you have to first weigh the pros and cons to your convenience.
To ensure getting back your money, follow these steps from BoB.
1. GROUND RULES
There’s no shame in setting up clear ground rules. Think of your friendship or family bond, it will be under pressure. Guidelines will keep it simple, clear and fair!
Keep the transaction simple. Draw up an agreement about the amount and the timing of the refund as you both see fit and then sign on it both of you.
2. In loan, relationship between friends &family is at risk
Know that by loaning money to friends or family it’s one of two ways as a worst case scenario: either they don’t pay you back or you lose your friendship but can still recover with time.
If a close friend has a reason you believe is justified of why they can’t pay, I wouldn’t persist with collection efforts, just drop it, or give it a pause.
3. Creative Action
Communicating with the borrower about the payment is always a sensitive matter.
The action that needs to be done is a reminder. The way to avoid reactions from the borrower on the reminder is by searching for a platform that can do it for you.
Also, it is important to continue communicating during the payback period, to keep the relationship on track.
At the end, keep in mind never to put yourself in a situation where you’re lending more money than you can afford to lose. In that regard, you come first. If handled correctly, it can all go well for both parties.