From one of our readers:
A friend of mine is switching apartments and having trouble getting money together for his first month, when he'll have to pay rent and a security deposit (equal to another month's rent). He asked if I could lend him some money—in the neighborhood of $200—and I'm not sure what to do.
On the one hand, I have enough savings to comfortably loan out that money for a couple of months, but I feel like I've heard so many horror stories about friends lending money to friends... I would hate for this to ruin our friendship. At the same time, I'm afraid it might ruin our friendship if I don't lend him the money, since he pretty much knows I can.
So what should I do: Lend him the money? Tell him "no"? Make up a lie for why I can't spare the cash?Want advice from Dollarish?
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Comments (48)
No.
And a longer answer: No, instead give him the money or not, but don't loan it. You don't want that between friends. Given the small amount I think I'd just give it to them, and if they choose to in some way repay you in the future that's cool, but don't loan it out expecting it to be paid back. Your friendship is worth more than $200 I would hope.
Hate to say it, but you shouldn't. Lending money always leads to problems. If you really do feel bad about it, the best thing you can do is just give it to him. Because he's your friend, he might push it off and say he'll pay you back later, which is code for 'not going to happen'. You could also make a deal, like you lend him the money, while he gives you something really important to him for you to keep until he pays you back what is owed.
NO. never. You don't want to end up on one of those televised courtshows, do you?
Unless you NEVER want to see your money again, then you should lend it to him. But if you like your money where it is, DON'T!!
no, if he can't provide rent himself, he's not ready to rent on his own---recommend he try splitting the cost with a roommate---there's always craigslist to help him in that area. you are only setting yourself up to be used if you lend out money.
Here is my $0.02:
When you lend money to a friend, do not expect your friend will ever pay you back. So when you lend that $200, think as if you drop that $200 into the ocean and you won't see it again. It will make you feel better if you cannot collect it at the end. Things can turn ugly if you press him/her to pay back the money.
If you are uncomfortable to lend $200, but if you are ok to "lend" $50 or $100, then make an offer to him and I'm sure he will appreciate it. But if you are uncomfortable to "lend" any amount, I suggest not to do it. However, what will you feel if you were in his shoe? (especially if both of you know you can afford that $200). It's not easy for someone to ask friends for financial help. It takes a lot of guts to do so.
Good luck!
If you need it, make up an excuse. Otherwise if the amount is small to you go ahead and lend it. Just don't expect it to be repaid.
First off, your possession of the funds should have no bearing on this, this decision should be based off of his ability to pay back the loan. The best thing to do in this situation is eliminate the friendship in considering whether to offer the loan, would you offer it to a stranger with the same situation? There are a few red flags present in this,
1st, he knew about the bill when he signed the lease for the new apartment, which means he had the time to prepare and save for the payment yet failed to do so, which implies financial mismanagement.
2nd, given #1, he previously overestimated his ability to obtain funding, why does he think he will be able to repay you? Is he overestimating again?
3rd, there was no mention on his part about the specifics of when he would pay it back and at what agreed upon interest rate
4th, no collateral was offered
5th, he is asking you for the loan instead of a bank, which means that either he was turned down by a bank, or he knows he wouldn't be approved for a loan. Either scenario has a very valid reason that you need to consider.
6th, if you have to ask dollarish, you are skeptical about his ability to pay, I think you know the answer is no, but you just want someone to tell it to you, so the answer is no. If he is a good friend your unwillingness to help him will not damage the relationship.
If you still want to help your friend even if you know he can't afford it financially, perhaps you can find some tasks/ services you can have him do to earn it. (ex: computer repair, snow removal, laundry service)
Agreed with the other commenters. Once you give money to a friend, don't expect it to come back, no matter how trustworthy they seem. See if he can do something back for you if you know he can't pay it off.
If he is really in a pickle make him sign something.
If you feel like you should loan him the money, I recommend having him sign something saying stating the amount that has been borrowed and when/how it will be repaid. ($10 a week or all of it by March 31.) Whatever you are both comfortable with.
My theory behind that is a friend who will pay it back no matter what doesnt mind signing it - because they will stick to the agreement. A friend who would stiff you will have a problem with signing it.
I would only do it if he's a really good friend. See if he could pay you back $50 a month or something like that?
@xsimplepleasuresx@xanga - nicely put! i agree!
I'm always iffy when friends ask to borrow money. Small amounts like $10 is one thing.
I had a friend who needed to borrow money for school because she had problems with her parents and they wouldn't help pay. She asked me to borrow some, and I thought about it for a while. I told her I couldn't, and I'm glad I did because I don't talk to her anymore now.
Yeah you might be great friends, and it is definitely a nice gesture, but honestly, it's not worth it. Like many people have said, you may have a chance of not seeing that money again. I've heard stories about people letting friends borrow money, and people usually end up trying to dodge their friends on purpose because they can't pay it back.
i've gotten screwed doing this a few times, by very best friends. you & them sign 2 papers (1 for them & 1 for you) saying that they will pay you back so much a week or by a certain time. if they don't you can take them to court cauz it is a written agreement. may sound kinda harsh especially if they are a best friend; but it has helped me getting paid back.
Yes. If you're a friend, be a friend. Kiss the money goodbye though hehehe.
if you are having second thoughts and felt it necessary to ask on a blog... well then you just shouldnt.
it has been experience in the past that lending money to friends will ruin the relationship but i also know that good deeds equal good blessings in the long run so i think that if you could comfortably lend the money to a friend that will use the money for the right thing you should do so with the thought in mind that you may not get it back. lokk at it like a gift. tell your self that you may not get it back. anything could happen that may hender that person from getting it back to you. it's up to you if you let it ruin the relationship. times are hard right now for most people. do a good deed and i promise you that good carma will come back to you. it's called "The Law of Attraction!"
I'd have to say no, just because people don't tend to pay eachother back. And when they do they take ages and make excuses and it just drags out for far to long and puts a daper on the relationship..
no. close friends and money should never mix.
tell them to get it from someone else.
My take on lending is you should just look at it as giving. If you can't afford to GIVE it then don't LEND it. That way if you get paid back then "woohoo!" that's a plus but if not YOU'RE not the one that gets screwed over.
No. You should never loan friends money. It just gets too weird. What if he doesn't pay you back right away or ever? If you really want to help him, well, as others have said, don't loan him money unless you truly do not expect it back and are truly okay with that. Think of it as a $200 gift. In fact, when you give it to him, you should be able to honestly say, "Pay me back whenever you are able" and accept that. So the next week when you see him buy a new plasma TV or out at the bar drinking it up, you should be okay with that. My suggestion, if you really feel like he's sincere and he's wanting to pay you back and all... just give him the money. Tell him it's a gift. Personally, a real friend would pay you back anyway.
I lent my friend $100 one time after he decided to up and move away. When he returned, he promised he would pay me back once he got paid at the end of the month. When the end of the month rolled around, he informed everyone that I said "don't worry about it" I don't remember saying this, and pretty much got dicked out of $100.
I guess I deserved that.
NO. If you do lend him the money, I doubt you'll ever get the money back.
If it's a friend who's never really asked for much, especially that much in monetary value, I would say that a good friend is definitely worth at least that much and I would say to give, not lend. If a situation arises over your reimbursement, then essentially you'll have paid $200 to end that friendship. That's just my take.