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Dear Laurie:
Lending money to friends or family is a daunting proposition – not only are you out the cash for the time being, but the road to repayment is often rife with pitfalls that
may well jeopardize the relationship. The way I see it, you have two problems here. One, you need to get your money back. Secondly, you have to find a way of going about
it that will preserve the friendship (provided you're willing to give her the benefit of the doubt).
Suggest meeting someplace quiet for a drink or coffee. Trust me, she did not forget she borrowed this money from you, and she’s probably been dreading this conversation
for the past year. Meeting on neutral territory will help to lessen any defensiveness on her part. Did you have her sign anything when you lent her the money? If you did,
dig out the paperwork and bring it along with you.
I'm a fan of practicing what you're going to say beforehand and preparing for several different responses – this may be a particularly helpful exercise for you considering the
fact that if you were unafraid of confrontation, you would have addressed this issue six months ago. It’s okay – no one really enjoys bringing up the subject of money with close
friends, but you need to psych yourself up beforehand so that you don't back out completely.
While it would be wonderful if she bursts into tears, begs your forgiveness, and pulls out the money right then and there, that’s probably not going to happen. You will most
likely get one of two reactions: lame excuses and/or an accusation that you're being unfair.
Regardless, keep the conversation calm and let her know how much you value the friendship, but stand your ground on the fact that you want the money back as soon as possible.
Resist the urge to make sarcastic references to her penchant for $25 lipsticks or her new $150 purse. The point is to get your money back, not to alienate or humiliate her.
Offer options such as a payment plan, a lump sum, or any other solution that will make you look flexible and give her some breathing room, but make sure that she commits to
something then and there. Put the agreement in *writing and have her sign it, keep the original for yourself and send her a copy. Depending on the
state in which you live, it may not carry any legal weight, but for many people the mere act of signing their name brings with it a feeling of commitment.
If she values the friendship, this will be the last conversation you will have to have about the money – she will pay you back and that will be the end of it. But prepare
yourself for the off-chance that she may avoid you from that day on. If that ends up being the case, chalk it up to experience and be thankful that you have a perfect explanation
to give when you decide not to lend friends money in the future.
Lacey
*For the proper terminology of a Promissory Note or any other legal document, consult your attorney.
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