Economic woes in the past few years have made it more difficult for individuals to obtain traditional lines of credit. So when it comes time for them to put a down payment on a house, make home improvements, or buy a car, many are turning to family members for the money. But lending money to a relative brings its own set of pros and cons.
Personal finance expert Roger Wohlner has written an excellent post offering his four tips for lending money to someone in your family. On the "pro" side, your family members won't check your credit score. On the "con" side, failure to repay the loan could ruin your relationships or your family member's finances.
If you're approached by family or a close friend and you have the money to lend, Wohlner offers four excellent tips to make sure the loan doesn't ruin your relationship or your finances. See his four "rules" here: http://retirement.equifax.com/2011/02/4-tips-for-loaning-money-to-family.html
Ilyce Glink is the author of several books, including 100 Questions Every First-Time Home Buyer Should Ask and Buy, Close, Move In!. She blogs about money and real estate at ThinkGlink.com, The Equifax Personal Finance Blog and CBS Moneywatch She is Chief Content Strategist at RealtyJoin.com, a community for real estate investor