How To Avoid Straining Your Relationship With Friends Having Lent Them Money

Lending money to friends is not a bad idea, but most often the consequence may not be worth the stress.

Here are steps that’ll help you stay out of trouble with close friends and still maintain your friendship afterward having lent them money.

#1. Lend to friends who have the capacity to pay back: The first fact check in lending money to anyone is their ability to pay back as at when due. It’s reasonable to say you should know the financial capacity of a borrower before you part with money. Even the banks in this case have an obligor limits and why you cannot get certain amounts as loans just because you have a need for money. Assuming your friend is on payroll with a monthly salary of N30k and is asking to borrow N100k from you to pay back over a period of 3 months. You’ll be reasonably stupid to think he’ll be paying back N20k or even more monthly which should sum up to N60k in 3 months or more, thinking he’ll be surviving on N10k all this while. In this case, you’re still running on a deficit of N40k. The character and willingness to pay back maybe there, but the capacity isn’t there you know.

#2. Don’t lend friends or anyone what you can’t afford to lose: This is common sense, kindly be informed that lending out money could go either way, it’s either you recover such loan or it goes bad. Security should apply first, by ultimate good faith you will need to part with an amount you can forfeit if the loan goes bad. If you think a borrower lacks capacity why not give him/her an amount you can afford to lose for free, they can go source money elsewhere to make up the required sum.

#3. You must establish the borrower’s intent: There are some wants that are not necessary on an economic scale of preference, for example, it’ll be very stupid of you to lend money to a friend who wants to use it for; wedding, burial, child dedication or gamble. This may sound insensitive, but the truth is, money borrowed for any of these reasons have a 98% chance of not being returned. These are termed optional issues you can do without, people borrowing for weddings will tell you they’ll return the money from the proceed sprayed to them. Even if they didn’t tell you how else you expect them to realize such money, good luck anyway.

#4. It’s safer to lend your gender: As a man lend strictly to your gender, as a woman your gender should be ok for you. Not to say that there are genders that do not default, however, women are found to default more in soft loans, while men do most in organized loans. Lending to your gender will ensure you’re rigid and immune to emotional blackmail, you can instill any level of approach to recover your money.

#5. If you must lend money, lend to people close to you: Study has shown that lending to people close to you pays than otherwise. If you stay in Anambra, it’ll make it the most stupid to lend money to a friend in Lagos. If they default on such a loan, how can you drive it? Lending to someone in the same town will ensure visiting physically at every instance of elapse tenor to ask for your money. The Lagos friend may decide to block you on calls and WhatsApp even bad-mouth you, be wise.

#6 Have your loan in writing and ask for collateral: A written agreement should help secure your money when you’re parting with an organized loan, may not stop default anyway. Ask for tangible collateral that is worth the money, you need to play safe. Loans backed up hardly go bad, in the event it does you can recover your money from the collateral, so don’t be too afraid to ask for one.

#7. Avoid lending the second time: Study has shown that most friends return the first loan to gain your confidence, most often with a second agenda to borrow a higher amount. Most second missionary loans are not returned, they go bad and that’s it. If they manage to pay back the first time, a second chance may not be worth the struggle.

#8. Do not lend at all: Friends may not like this idea but it’s just about the safest route to stay out of trouble with friends for lending money. They’ll feel bad, yes, but it saves you emotional pains, time, and money. I can’t stand the sight of dragging a friend irredeemably for lending money. Hope you learned something from this piece, “Oya” share it for everyone to read and save someone from the pains of bad debt.

Source: Finance NGR

they did not know how to tie the appropriate knot. When the groom reached down to loose the ring from the pillow, and pulled the ribbon, the ring did not come loose.  wedding officiant