Loaning friends money

[JaBlue]

I think you gotta have [censored] friends to ask for loans unless they really need it. They've gotta know the snare that puts you in: a)if you don't loan, you run the risk of looking like a jerk, not being a real friend. b)if you do loan it could get ugly. My friends have never asked me for a dime. Of course I'll spot them for a dinner or something. They pay me back. If a friend was in need there is no doubt I would give them money.

[Black Wings]

If im lending a friend money, they have to be pretty close. if someone lends me money, i buy them a drink and would judge someone by the same standards. if im lending, i tend to lend a bigger sum than i ask to borrow. i'm often a little short when watching the footie due to bad planning, if that person is prepared to lend me 20 notes quite often, i have no problem lending a much bigger sum every now and then.

[MasterLJ]

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I loan close friends money, and they've always repaid it. My general rule is if I believe our positions were reversed and they would loan me the money, then i'll lend it to them.

However, I loaned my brother $3200 a little over 2 years ago and am starting to think I'm not going to get it back. This has really been bothering me, not because he owes me money, but because he is screening my calls now and I basically have gone from a good relationship, to him avoiding me because he feel embarassed that he has owed me money for so long... Now I wish I'd never loaned him the money. Also I heard from a relative my brother went on a 2 week vacation out of the country recently rather then paying me back... Honestly I don't know what to do, because I know if I come down on him he'll probably never talk to me again.

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This is one of my biggest pet peeves and grounds for me ending a lifelong friendship.

When you owe people money you should not be buying shoes going on vacations or whatever...

[trapsetter]

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a friend owes me 2k. It's just come up on a year now. He says if things go well, he can pay me before the end of the year

Also, am I a nit here being irked by the fact I'm losing like $200 in inflation/opportunity cost?

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Yes. If he is a good enough friend that you're willing to loan him 2k, then you shouldn't be worried about the $100-$200 foregone in interest/investment opportunities.

[trapsetter]

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Lately though, he's been hanging out with the wrong kind of people, getting mixed up with selling drugs (pretty harmless)

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Come again??

[AJackson]

I don't loan. When I was younger I did loan and never once got paid back. Now I keep my finances to myself. Money and friendships don't mix.

If I feel the need is real and serious, I make it gift-not a loan. However, I have to ask why their family isn't helping out and why they are in this situation and have no reserves. The answer is almost always that they live their lives with no consideration for emergencies and have burned bridges with their family.

Also, to those that say they make the loan, but consider it a gift and a bonus if they're paid back, I think you're taking a big chance with your friendship. An unpaid loan weighs on their mind and yours. If it's a gift, make it a gift.

[Go_Blue88]

I will never loan a friend money again. I lent money to a good friend of mine and he took ferever to pay me back and as a result, every conversation we had was about him owing me money as opposed to our usual fun talks about poker/computer games n such.

Here are some of his excuses:

In January: "I ran into a tree...I'm in the hospital..." of course I respond with kindness and tell him to pay me whenever he gets a chance. Oh and yes, he physically ran into a tree...

February: I ask him to pay me before I go on my Vegas trip. Him: "Sure, no problem, I might even meet you down there." He doesn't come and doesn't send the check. I call him b/c I need the money to pay taxes (a lot of my money was on FT and in a CD). He's like "OH OK sure." Then the next day he calls me to tell me that he has mono and might be too sick to mail the check, but he'll "try." Of course he doesn't try, and I'm really understanding and tell him to take his time. I end up borrowing money from my dad for this.

March: I call him and he tells me he's in the mountains. WTF WTF WTF WTF does that mean? They don't have mail boxes in the mountains? Ohhh the humanity.

April: He's back from "the mountains," and I call him and he says he'll transfer me the money on FT. I'm all excited but don't end up getting the money. He then tells me that he sent the money to the wrong person. WTF WTF WTF.

Later in April: I ask him to mail me a check, he takes down my information again and hangs up. Of course he doesn't send the check for another week even though it'd take 5 minutes of his day to do me that favor.

May: The check apparently gets lost in the mail. WTF WTF? I also hear that he's been spending money like crazy and start to worry that he'll have no money left if he puts off sending the check for any longer. So now I have no idea what to do and so I talk to my dad about my options. My dad wants to sue him, and I'm like "woah woah woah, I'll talk to him."

So finally, I think the check is coming tomorrow. haha it's weird though b/c I believe every excuse of his even though everyone I talk to thinks I'm naieve.

The whole situation is unbelievable to me. In the past 4.5 months it would have taken him 5 minutes of his life to really help me out...and he couldn't even do that. Just very strange for me to see a friend do that.

I dunno, in conclusion, I'm never lending money to a friend unless he absolutely needs it (ie not for poker, pot, and "the mountains").

[HP]

blue, reading that post pissed me off cause i went through like the same thing

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haha it's weird though b/c I believe every excuse of his even though everyone I talk to thinks I'm naieve.

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I can identify with this

[LearnedfromTV]

I've loaned a few hundred dollars both to a cousin I'm close with and a good friend. In both cases the money was used for something that we both wanted to do but they couldn't afford at the time. So I just covered them and they're paying me back $100/month. I wouldn't have made the loan if I cared about getting interest on it or if I worried about them missing a month here and there. Both have significant debt (med school, undergrad, credit card, you name it), but eventually they'll pay it all back. And their attitude toward money and other people's success is ideal for this sort of situation - neither one of them is ever going to be anything but happy for a friend with a lot of money, jealous of someone with more money, etc.

There are very few friends I would trust in this situation (both in terms of getting paid back eventually and in terms of not letting the relationship be weird), but these guys I do. I never bring it up. When they bring it up, like "hey man, I'm sorry I haven't paid that all back yet, I'll get you another hundred in a few days" I just say no worries. Imo if you aren't absolutely sure that the way they'll handle it won't affect the friendship (even if they can't pay for a time) or you will ever be in a position to have to ask for the money, don't loan.

I thought Scorpion Man's post was excellent.

[MatthewRyan]

I loaned a friend $800 once. It took almost 2 years to get that money back and put a strain on our friendship because everytime I saw him spending $20 to goto the movies or get some beers I would just thiknk to myself that he should be giving that money to me.