Frugal Framnett

Have you borrowed money from a friend or family member? I am not talking about $10 or $20 but a significant amount? A couple of hundred or a thousands? If so, how did it work out for you? Any advice?

We have some acquaintances who have loaned an individual a total of $20,000.00 and it appears they are going to lose the money. Some of those lenders made some very fundamental mistakes.

The three lenders I refer to as Aisha, Miriam, and Hamza. The borrower I refer to as Fareeda. The names are changed but the characters in this story are for real.

Aisha agreed to lend money to Fareeda, but Aisha took a loan from the bank to do this. Aisha should have said no, but Aisha has one thing on her side she asked for and got a signed note from Fareeda acknowledging the loan and terms. Aisha & Miriam lent money but let their friendship with Fareeda be the agreement. My understanding is Aisha & Miriam lent the money out of their savings.

Fareeda is not repaying, Fareeda is in money trouble and her business is closed (a store) and shutdown. Fareeda is also now hiding and making herself hard to contact and get a hold of.

I think in this case, all three are going to lose their money. Aisha stands an excellent chance of getting a judgment but I wonder about Aisha & Miriam. I hope (but do not know) they transferred the money to Fareeda via personal check made out to Fareeda so at least they have proof Fareeda received money from them, but given the situation and the characters I doubt it, they gave her the money in the form of a big pile of crisp new $100 bills.

I have borrowed significant money from family. We signed a note and were very clear on the payment terms. We are still paying on that loan but shortly it should be paid off in full.

Get a note, it does not have to be full of legal speak but it needs to specify the amount lent, the date lent, the amount to be paid back, and how the amount is to be paid back. Then use a check to transfer the money not cash.