Money Owed to you by a Friend and how to recover it
Money Owed By A Friend and How To Recover It
Private Loans do not necessarily have to be provided by a bank, building society or financial institution. Money owed by a friend is a common issue.
It may provide some comfort to know that if you are owed money by a close friend, there are thousands like you.
Depending on the amount, borrowing money from a friend may seem like a completely normal situation.
There are almost as many people wanting to lend money to you as there are people wanting to borrow it.
Also, money can become owed for goods and services that were provided by one party on the promise of payment from the other.
If that promise is not met, this needs to be collected as soon as you see no payment incoming.
If you leave the recovery of the money, this could leave you with even more financial difficulty.
Personal loans between friends and family members are nothing new but when agreements get broken, tensions can arise.
Here are some top tips to act upon the situation when non-payment from friends or family members does not happen as it should.
No one should have to be put into a difficult financial situation, especially if it is due to someone they are supposed to be close with.
If a friend decides that they don’t want to pay you back the money you lent them, there’s nothing you can do. Right?
You may think that taking legal action is a valid way of getting your loan money back, but this will come with unnecessary court fees.
Asking a professional for legal advice may help, but there are ways in which you can do this by yourself.
The first action you take to get the money you have loaned back should be before the loan is made.
Put It In Writing
Probably the most important advice you can take is to put the loan agreement you are making down on paper.
In the short term, this may seem like a wasteful task however can help your bank account in the long term.
It can be difficult to broach the subject of formalising the loan, especially when it comes to friends and family.
The official document will need to be signed by both parties and will outline details of the sum of money and the time it is being paid over.
So, you’ve got it in writing and payments are being missed. What can you do?
First of all, you should always be polite during all communications with the person that owes money.
If you enter the discussion in a combative mood, then you’re much less likely to reach an amicable conclusion.
Most problems can be resolved, reaching an agreement via polite conversation.
If the conversation fails to bear fruit, then put your requests for payment in writing.
Incremental past due notices can be used to create a paper trail, which illustrates your commitment to being repaid and can be as evidence used in court.
Consider Reaching a Compromise Agreement
If you feel that compassion is the best course of action, you can amend the original arrangement.
This can be done with either a reduced amount or an extended time frame that better suits their circumstances.
It can often be a move that can save face for the lender and in turn, a friendship.
Seek Professional Help
If all of your personal attempts to recover your debt fail, then it is time to talk to a professional.
A Private Debt Collection specialist can assess the situation and act on your behalf without the need for expensive lawyers or court action.
Money owed by a friend can be a real headache but it can pay to know there are specialists who are ready to help.
A Professional Debt Collection specialist will guide you through the process and advise on the best course of action.
Lending money, especially to friends and relatives can be tricky, so remember to be smart and take action if somebody is taking advantage of your good nature.