Loaning money to friends -what do you think?

[ReadingMama]

We have some homeschooling friends who have a large family and their own business.  They've been having some tough times lately.  Near the end of April, they called and said their phone was in danger of being shut off and they had no money for food for the weekend.  She told me that they'd be "flush with cash" after the weekend, but that they just needed something to tide them over until then.  They don't have any family nearby (or close to them emotionally, really), so she asked me.

I had money to pay a bill just sitting in the bank, and since she said they be able to pay it back after the weekend, I loaned it to her.  It was $600.  Here it is a month later, and I haven't been paid back yet.  She's saying deals fell through and they got an eviction notice, and are eating "humble meals of beans and rice." 

I thought I was doing them a favor--you know, just helping them make it through a tough weekend.  But now I am just another person who they owe money to.  I feel taken advantage of.  If I'd known that the loan wasn't going to be paid back when they said it would, I wouldn't have loaned it.  It wasn't savings--it was for a bill.  I would have helped them out in another way--looking up assistance agencies or food pantries in their area, for example.

What do you think about this?  Do you loan money to friends?

[34me]

I have a rule of thumb that you only ever loan money that you can afford not to get back. 

[yeahwhat]

I agree.  I don't loan money to friends.  If they need some, and I have it available, I give it to them.  If they ever do pay it back, then it's a happy surprise.  If they don't then I'm not out money I need for something and I'm not resentful.  So far, this has only applied to small amounts of money, because we never have significant dollars with no plan for them.

One friend in particular has asked me to lend her money (more than say $20-$40) a couple of times because she has this idea that dh and I are good with money.  Well, we're not bad with money, but we do have a very limited amount of it and 6 people to house, clothe, and feed, and some debts of our own, so I've always had to turn her down.  Now, if her mother was dying and she desperately needed to hop on a plane and had no means to do so, I'd be the first to buy her a ticket, but I can't lend, and certainly can't give her money, to fund a lifestyle that her income (and ours) doesn't support.  I generally just say we don't have X amount to lend and leave it at that.

[zinemama]

I'm sorry you got scammed. No, I would never loan to friends, although I would try to help out with a gift if asked.

[crunchy_mommy]

I'd happily loan $10 if we were out & a friend needed to buy a snack or something. I'd also happily drop off a few bags of groceries to get a friend through the weekend. But I would not loan out any significant sum of money. I do have a few close friends I might gift large amounts to if they really needed it, but I wouldn't call it a loan & I wouldn't expect it back (though I do think most of them WOULD pay it back depending on the situation!)

$600 is a lot of money!!! I can't imagine needing that much to 'get through the weekend'... I'm sorry your friend hasn't paid you back, I hope she does eventually...

[elsie]

I'd never loan money I needed back. Learned that lessons years ago.

[spedteacher30]

We have a couple of friends we have lent large-ish amounts of money to, and we have a couple of friends who have lent us large-ish amounts of money. We never lend money we have an immediate need for, and we've always gotten it back--even if it takes a while. We still owe my mom money, but we have plans to get it to her, and she follows the same rule we do--which is don't lend money to someone if you can't afford to never see it again.

[Peony]

Nope, lesson learned here as well. I also no longer "sell" something to a friend unless they hand me the money when they take the item, saying they will get it to me next time they see me or even tomorrow also doesn't work. 

I'm sorry this happened to you. 

[zebra15]

Nope- I don't 'loan' money, I will 'gift' money if I have it, and right now I don't.  I don't see how your friend would need $600 for the weekend??  At this point I doubt you are going to get that money back.  I know you can't go back in time but in the future I would offer a bag of groceries, something like that.

[honeybunmom]

We have in the past, but wouldn't now.  In the past when we did it were in a condo and childless with six figure income.  Now, although the income has increased, we have a home in constant need of repair since we are still rehabbing it, 2 more mouths to feed, tuition based pre-school and another on the way.  We simply are not in a position to be without it for however long it may take someone to pay back.

At this stage, if I had friends who couldn't feed their family through the weekend, I would feed them or offer to take them to the grocery store, not give them cash.

[HollyBearsMom]

$600 bucks? yikes that is a LOT of money to just get someone thru a weekend.  She must have been seriously past due on that phone bill.

To answer your question, no I would not have lent the money to them.*Especially* if that money was already earmarked for my own bills!! If they were very close friends I might drop off groceries so the kids could eat, as another poster mentioned. 

In my life I don't loan money other than they usual "give and take" of friendship. The kind of "Here let me get the coffee, you bought me tea last weekend". I think if one of my siblings called that with kind of sob story I might go to the phone company and pay the minimum balance to keep the phone on and then invite the whole family to dinner with major leftovers to take with them. I would not handover cash.

[umsami]

I'm sorry this happened to you.  

In general, I prefer to gift money to friends--rather than loan.  I've learned the hard way as well.

I've never loaned money that I needed for a bill--because I need to ensure my family's security first.  However, it can be tough to be resistant to a sob story.  I guess for me--I wouldn't have viewed a phone as critical for the weekend. Food? Yes.  Heat, if it was cold? Yes--but you can also usually talk to the phone company.  Here, if you have kids under 5, they're not supposed to turn it off.

I'm really sorry this happened to you.  My guess is that your friend believed her story--even if she was lying to herself on some level.  Not sure if that helps, but I know few people who would take such a large amount of money from somebody else without intended to pay it back.

[averysmomma05]

I never loan money. I only give money I don't need back that way I am not scammed. We loaned bro in law $600 last year still haven't seen a dime and we aren't even on speaking terms anymore. Lesson learned.

[ReadingMama]

Well, we still don't have the money, though I am getting emails saying she will pay it back as soon as she can.  The $600 was a supposedly short-term loan to keep things on and running for their home and family business over the weekend.  The way she presented it was that they'd be getting paid for advertising jobs the next week, so this was just a short-term emergency loan for the weekend.  It's a really big family and the call was made late on a Friday.  I asked her about food pantries, but as it was late on Friday, that wasn't an option.  We don't even live in the same state, so I couldn't get her groceries. And they have no family nearby.  I used PayPal to send the money. 

She's now saying that they are trying not to get evicted and are eating very basic meals, and that she'll let me know when something changes.  I think I've just become yet another person they owe money to.  If I had known that up front, that the money they were expecting "after the weekend" was hopeful thinking rather than a sure thing, I wouldn't have loaned it.  And I won't again--period.  Unfortunately, being generous and helpful doesn't go unpunished nowadays. 

What really makes me mad is that she doesn't seem very concerned about how late the repayment is getting to be.  I feel used.  I think this is the end of the friendship.  Perhaps this is why there wasn't anyone else for her to go to for help......

Thank you all for your answers and compassion.

[mattemma04]

I loaned over 600 and never got it back.Strained the friendship.Gift money but never loan to family and friends.

[Amys1st]

So sorry this had to happen. You are a good person for trying to help your friend, but its an expensive lesson/mistake. I cannot imagine how your DP feels about this since my DH would have a royal fit if I lent any money out. We have a similar person in our life right now, has 5 kids, going thru a divorce and all kinds of other issues.

The whole 'call late on Friday' sounds incredibly fishy to me, so I think you have been had. I would let her know how used you feel and be upfront about that money was reserved for bills that you had, not for fun.

Originally Posted by ReadingMama 

Well, we still don't have the money, though I am getting emails saying she will pay it back as soon as she can.  The $600 was a supposedly short-term loan to keep things on and running for their home and family business over the weekend.  The way she presented it was that they'd be getting paid for advertising jobs the next week, so this was just a short-term emergency loan for the weekend.  It's a really big family and the call was made late on a Friday.  I asked her about food pantries, but as it was late on Friday, that wasn't an option.  We don't even live in the same state, so I couldn't get her groceries. And they have no family nearby.  I used PayPal to send the money. 

She's now saying that they are trying not to get evicted and are eating very basic meals, and that she'll let me know when something changes.  I think I've just become yet another person they owe money to.  If I had known that up front, that the money they were expecting "after the weekend" was hopeful thinking rather than a sure thing, I wouldn't have loaned it.  And I won't again--period.  Unfortunately, being generous and helpful doesn't go unpunished nowadays. 

What really makes me mad is that she doesn't seem very concerned about how late the repayment is getting to be.  I feel used.  I think this is the end of the friendship.  Perhaps this is why there wasn't anyone else for her to go to for help......

Thank you all for your answers and compassion.

[cocoanib]

OP, so sorry that happened to you. Like the PP's, I had to learn my lesson the hard way too.

Now, I never loan money I can't be without. Not to my friends or fam.

Can you call her up and tell her what you said here and really make yourself heard? Tell her that money was for a bill and she's really hurting your family by not returning it on time. Tell her that you never would have loaned it unless she had promised to pay it back the next week. I would really lay it on her. If you don't get it back after that, then unfortunately you just have to move on.

[lookatreestar]

i am the same way- only loan if i want to consider it a gift. if they surprise me and pay me back- good for them but i don't let them know it wasn't expected. i just gave up a 20inch flat screen tv and my neighbor was supposed to pay me 50 each week and i haven't seen anything yet. she knows where i live and i haven't seen her in awhile (just been crazy busy!) and if she ends up paying me awesome, if not that's fine too. the tv was just in the closet collecting dust.

[ReadingMama]

Yeah, about that....  I still haven't told my husband.  Or anyone besides my best friend and you guys.  I am so embarassed.  It was a stupid thing to do.  I've got a grace period on the bill.

I emailed her and said that the only reason I loaned her the money was because she said they'd be "flush with cash" the next week.  I told her that I offered to loan my mom money (she's a couple months behind on rent), but my mom declined because she didn't want to borrow more than she was sure she could pay back.  Every week I email her asking her about the money, and every week she says things like, "Just trying to keep food on the table.  None of our business deals are working out thanks to Corporate America.  Will let you know when things change." 

And that's it.  No effusive apologies.  No, "I'm so sorry!  I really thought we'd be able to pay it back.  Here's $50..."  It is now 5 weeks after it was supposed to be paid back.

I have a Facebook advice column.  What do you think about me posting about this as a general situation with no names or identifying info used?  Group members can post advice and she's a part of the group.  Would that be mean or passive aggressive or get the point across?

 

Originally Posted by Amys1st 

So sorry this had to happen. You are a good person for trying to help your friend, but its an expensive lesson/mistake. I cannot imagine how your DP feels about this since my DH would have a royal fit if I lent any money out. We have a similar person in our life right now, has 5 kids, going thru a divorce and all kinds of other issues.

[zebra15]

Sorry she hasn't paid you but the FB posting is a bit Passive Aggressive.  Ouch, Dh doesn't know, that's gonna be tricky.  At 5 wks out now I don't think she is going to pay you back.  Either she never intended to or she just wont be able to get caught up on her bills to pay you.  Its probably the 1st option but you never know.  At this point I would 'write it off', call it a charitable donation, early christmas present, whatever and move on.