Individual borrowing - how to enter contract and effect payment if default

[jacqueline0724]

What is the name of your state (only U.S. law)?

I considering of borrowing an amount of money to one individual, free of interest. I would like to know whether we can have an agreement legally for the amount owing me and in the event of default, can i take legal action to recover my money, eg garnishee order, etc? what are the procedure that i need to do if i want to lend to this person based on good faith?

 

[racer72]

2 things.
1. US law only.
2. Are you borrowing or loaning the money? Your post is very confusing.

 

[jacqueline0724]

2 things.
1. US law only.
2. Are you borrowing or loaning the money? Your post is very confusing.

Thank Racer72,

Will be kind of you if you can enlighten me on this issue. I actually wanted to borrow the money to a friend but would like to know what is the correct proccedure legally i can do just in case he default my payment. Looking at his financial stand,he can actually paid but character wise does not honour all the payments. I'm wondering what are the things that i can do if he default, can i sue him?

The loan is free of interest and i just want to help him in good faith but at the same time i don't want to lose my money borrow to him.

I know probably i did not have a clear picture to you, sorry for making you confuse

 

[racer72]

I actually wanted to borrow the money to a friend

No, you want to loan money to a friend, let's make that soon to be ex-friend.
This is the best way to end a friendship known to man, these forums are full of posts by folks that have loaned money to friends and when the borrower can't or won't pay the money back, goodbye friendship. Another thing, do not loan the money if you cannot afford to lose the money.

If you truly want to loan the money, based solely on your posts, see an attorney and have a loan agreement written to your needs. This won't cost much and it will guarantee you have an ironclad contract. Also consider asking for collatoral from the borrower, this will give him a little more incentive to pay you back.

 

[jacqueline0724]

No, you want to loan money to a friend, let's make that soon to be ex-friend.
This is the best way to end a friendship known to man, these forums are full of posts by folks that have loaned money to friends and when the borrower can't or won't pay the money back, goodbye friendship. Another thing, do not loan the money if you cannot afford to lose the money.

If you truly want to loan the money, based solely on your posts, see an attorney and have a loan agreement written to your needs. This won't cost much and it will guarantee you have an ironclad contract. Also consider asking for collatoral from the borrower, this will give him a little more incentive to pay you back.

Hi Racer72,

Thanks for your speedy advice. I think now i know what i should do.