Loan agreements become tricky when it involves lending or borrowing from family or friends.
We would all like to help out the people we love in their times of need but sometimes the risk of losing the money AND the relationship stand in our way.
Debt.org outlines important factors to consider when lending borrowing from family or friends. Statistics from the Federal Reserve Board Survey of Consumer Finances highlighted that overall $89 billion is loaned between family and friends each year in the United States.
Loans between family and friends is a popular way of receiving financial support. This form of lender also offers lower interest rates and usually the exact amount that is needed. However, one unfortunate aspect when borrowing from loved ones is that your relationship is on the line and can potentially be damaged.
That is why Debt.org suggests you protect those relationships and build on that trust by forming a long contract. Regardless of your relationship with the other party, this contract will help protect both parties in the case of a disagreement.
Debt.org also believes that that fact of whether you know the other party or not doesn’t matter. Lending or borrowing money entails obligations and responsibilities and both parties should be accountable.
That’s where Credi.com can help these two friends of family members. Our platform helps form an agreement for people by people, not by institutions for people. Credi helps safeguard trust that you share with your friend or family member. Our platform helps protect your relationship and helps you get on with life.
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Credit: Bill Fay
Tim K. Dean, Credi Founder | Commentator & Expert on Family Lending, Bank of Mum & Dad and Neo-Credit Scores is available for media interviews and appearances. More…
Credi Pty Ltd is a Financial Technology business, not a marketplace lender. Our mission is to change the way we lend money. We want to empower people to help each other and take control of their financial relationships without creating friction and stress.
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