Consider your own needs
If your first response is to be generous, take into consideration your own needs, too. How much do you need in your emergency fund? What would happen to you if your or your partner’s job came under pressure?
If you need the money back in a few months, think carefully about lending it. If it is money that you need for school fees or your mortgage, don’t put it at risk. While the borrower might have a sincere intention to pay it back, you do need to consider the scenario that you might not see the money again. Setbacks can happen, particularly in a crisis.
It is best to be quite business-like with a loan. You need to have a detailed conversation with your sibling about their finances. Do they make poor financial decisions generally, or are they usually financially rock solid? If you lend them money, will you be asked for more money in the future?
Also be sure that they have made the most of the hardship assistance available: JobKeeper, JobSeeker, withdrawing money from their super fund as well as applying for bank freezes on mortgages and other state benefits.
Put it in writing
You want to avoid a dispute over whether the money was a gift or a loan. So always set out the terms of the loans including the amount, repayment schedule (perhaps when your sibling finds a job) and any interest to be charged. Unless you have it in writing and signed by lender and borrower, the reality is recollection of the deal will fade.
Loans that aren’t documented and signed are often not repaid. You could get a lawyer to draw up a document, but expect to pay around $1000.