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jtfrogger · 11-11-2011, 01:10 PM

I someone close to you asks you for a substantial loan, I personally wouldn't do it unless you were willing to let the money disappear. I can't remember where I first heard that advice, but I am glad that I did hear it and in fact taken that advice.

I have been in this situation twice, where someone asked for a substantial loan. Strangely enough, they were both a result of gambling debt.

In the first case, my best friend from high school asked me for a loan to help pay for his schooling. I already had my university degree. He was really smart and for some reason kept dropping out of programs and was on his third or fourth program. We had been living in different cities for a number of years and I didn't know all the details of how his life was going. His parents were reasonably well off and considered education extremely important. This smelt fishy to me and I didn't loan him any money. I found out a few years later that he was a gambling addict and the money he was asking for was to fuel his gambling habit. Luckily, he has turned his life around.

The second time, was my sister. Her husband had run them into severe debt through gambling. They had separated and my sister wanted $2000 so that she could do a few renovations in her home. She was in pretty bad financial shape at the time. I lent her the money and figured there was no chance that I was getting it back. She was a single mother with low or maybe even negative net worth. To my surprise, she did eventually pay me back. However, it did take a long time (something like 8-10 years). Most of the repayment came about $100 at a time. The fact that I mentally got myself to a place where I had no expectation of getting it back meant that I never mentioned it to her. I never asked her when I would get my next payment. In fact, by the time she paid it off, I had lost track of how much was owing. I can't imagine what our relationship would be like now if I did demand the money at any time. My approach could have lost me up to $2000. An alternative approach could have lost me a relationship with my sister. In the end, I got to keep both. I did remember thinking at the time that her repairs seemed somewhat frivolous and they could be deferred. Looking back now, they really weren't that frivolous. I am glad I didn't give my opinion, because my opinion was wrong.

11-11-2011, 01:10 PM	#31
jtfrogger Powerplay Quarterback Join Date: Jun 2008 Location: Calgary, AB Exp:	I someone close to you asks you for a substantial loan, I personally wouldn't do it unless you were willing to let the money disappear. I can't remember where I first heard that advice, but I am glad that I did hear it and in fact taken that advice. I have been in this situation twice, where someone asked for a substantial loan. Strangely enough, they were both a result of gambling debt. In the first case, my best friend from high school asked me for a loan to help pay for his schooling. I already had my university degree. He was really smart and for some reason kept dropping out of programs and was on his third or fourth program. We had been living in different cities for a number of years and I didn't know all the details of how his life was going. His parents were reasonably well off and considered education extremely important. This smelt fishy to me and I didn't loan him any money. I found out a few years later that he was a gambling addict and the money he was asking for was to fuel his gambling habit. Luckily, he has turned his life around. The second time, was my sister. Her husband had run them into severe debt through gambling. They had separated and my sister wanted $2000 so that she could do a few renovations in her home. She was in pretty bad financial shape at the time. I lent her the money and figured there was no chance that I was getting it back. She was a single mother with low or maybe even negative net worth. To my surprise, she did eventually pay me back. However, it did take a long time (something like 8-10 years). Most of the repayment came about $100 at a time. The fact that I mentally got myself to a place where I had no expectation of getting it back meant that I never mentioned it to her. I never asked her when I would get my next payment. In fact, by the time she paid it off, I had lost track of how much was owing. I can't imagine what our relationship would be like now if I did demand the money at any time. My approach could have lost me up to $2000. An alternative approach could have lost me a relationship with my sister. In the end, I got to keep both. I did remember thinking at the time that her repairs seemed somewhat frivolous and they could be deferred. Looking back now, they really weren't that frivolous. I am glad I didn't give my opinion, because my opinion was wrong.