Collecting money from a family member

[F16]

Originally Posted by disneysteve

I never said to withhold from family. I send not to lend. There is a big difference. If someone close to me was truly in need, I'd certainly GIVE them what I could to help out. It wouldn't be a loan. It would be a gift. If they chose to repay it in some way, that would be terrific (and I might or might not accept it). I think, in general, lending money is a recipe for trouble. Obviously there are exceptions, but as rules of thumb go, I think not lending money to friends and family is a good one.

Completely agree. Very good posting, Steve!

[mishi07]

Thats always a difficult thing to approach but from experience as it can be awkward and embarrassing for both parties.

I think I gave real advice--a mediator. I also disagree with the rule of thumb that one should never lend money to family. I actually find pretty shocking the idea of withholding from family.

I agree. Or something that doesn't require a face-to-face collection like email or voice message. If he/she takes time to reply then that when speaking would be best.

[cschin4]

Yes 10K is a lot of money. Sorry you are in this position. First, I personally would not loan money to relatives. I have given money to relatives and have made clear it was a gift with no repayment necessary or expected. If I cannot afford to make a gift of it or choose not to then I don't give them any money. There have been 3 occassions where we have given money to my BIL due to financial difficulties. However, he was recently in more financial difficulty and called to "borrow" money to pay his daughter's tuition. And, we had to say no to that one. We have our own children to think about and sorry but that was way too much money to part with. And, so his options were to bring his daughter home and and let her work a year (not a bad option), transfer to a cheaper school or borrow money from elsewhere which was what he managed to do.
ANyway, most likely the 10K will never be seen by you again and now the relationship will have a permanent blot. That is why I advise people never to loan to relatives as 9/10 times that is exactly what will happen and it will ruin the relationship.

[money2009]

I had to learn this the hard way as well. Now if a family member asks for money I simply look at it as a gift with no expectation of getting it back.

These scenarios can be quite discomforting to say the least and I'm sorry to hear that you had to go through one.

[alw_ays]

Each in our family is capable of getting loans, but our family believes that we can avoid paying interest to a third party and keep the money in house. However, our family also invests in each other's companies, and one family's success is all of our success. It kind of branches out that way and I'm really happy we've made this arrangment. My MIL carries my school loans, though I put them through the federal government first, she paid them and I pay her. I would rather pay interest to someone I know than some ephemerial entity.

However, my sister is is still young and bought a car from said MIL, made poor choices, and is not paying it off properly. But I have NO problem telling her time and again that she needs to make her monthly payment.

If I were you? I'd just send little monthly reminders via email or in the mail, printed through quickbooks or something. I'd tack them on their front door if necessary. Every check you get towards the loan, send your relative a box of chocolates or a flower or something. A new movie. Some petty little "thank you" incentive. They ARE your family, after all.

[DebbieL]

While it may work for the minority (in my opinion) I do think that lending to family is usually a write-off. I don't think you'll ever see your money again. I'm so sorry, but I think this was an expensive lesson.

[b4freedom]

Court. It's harsh, but sometimes family members need to be screamed at by someone like Judge Judy. But, even after the judgement, don't expect to see any money.