|Dealing with deadbeat friends or
Feelings sometimes get frayed the longer a loan remains
"To me, a month might seem like just around the corner, but
if Kim is waiting for that $100 she lent me, that might seem like
a long, long time," says Marsh.
Fortunately, there is a means today to remind an unresponsive borrower
of their obligation without creating hard feelings: e-mail. If you
made your loan through PayPal, the payment company will remind the
borrower on your behalf to pay you back.
"I think an e-mail is nice initially because it's less confrontational,"
says Izzo. "If you're using PayPal, you can use their great
reminder service so they can't pretend they didn't hear you or they
If your e-solicitations prove futile, a frank exchange may be your
"It's not actually rude just to come out and
ask them," says Izzo. "The longer you wait, the more you
brood, the more resentment builds. I hate to say it, but after two
or three times of asking, you may just have a deadbeat on your hands.
You might have to write it off, and write off the friendship, and
that's what happens. If they don't have the money or they're just
unwilling, then what kind of a friend is that?"
If a deadbeat friend is bad news, a deadbeat child or sibling can
be even worse.
"It's a huge problem, and it happens a lot,"
says Ruth Hayden, a financial counselor and educator and author
Money Life." "It's a topic that comes up frequently
in my office, probably more among family than friends. It's very
troublesome because it hurts your relationship. You can't just go
and find a new family."
Hayden recently counseled a couple who had been married
more than 30 years. The wife learned that the husband had secretly
lent money to his brother, who had failed to pay back a previous
loan years ago. Suffice it to say the wife was livid.
"There's a secret issue here, a money issue and a family issue.
It gets very complex," says Hayden. "We split it up into
issues. First, there's the trust issue between the two. We need
to solve that first because that's more important than money and
more important than the brother."
Hayden says the first test is obvious: Do you have the money --
or, more to the point, could you afford to lose the money?
Then she applies the hesitation test: "Do you
absolutely know that this person will pay you back? In the majority
of cases, the truth is in their hesitation. Do you absolutely believe
this person will pay you back, based on past history? If the answer
is hesitation, I encourage them to really think about it."