[originaltext]Melody Hopson: Thank you. For this question, I would start wi

Melody Hopson:
    Thank you. For this question, I would start with a very basic idea. Before you think about this familial obligation issue, let’s start with "Can you afford it? " And if you can’t afford it, that answers the question right away. Also can you afford it if they don’t pay you back? A bank thinks about the same thing. They assess the risk of the loan that they are going to make. And they don’t make loans that are going to make them bankrupt. You shouldn’t either, but if you go down this path, the one thing that I suggest you and that helps remove some of the resentment or problems that can occur is: Document it. Documentation helps a lot
    So those are the guidelines basically, you’re saying: write it down on paper, sign it, date it, interest rates, someone said, the interest rates are low, so this is a good deal. We do look at family as a good deal, even for paying an interest that’s usually lower than the market rate, right?
    Absolutely did in terms, the terms may or may not include interest. They may include a payment plan; they may include it all back over a lump-sum period. And then last, last but not least, sign it, copy it, make sure you both have a copy and when you get into issues, you pull out that piece of paper.
    If you don’t want to loan family money, maybe you can go to someone else, maybe you can cosign for a loan with the borrower at the bank, really to create that kind of distance... that might be meeting them halfway.
    We’ve been talking about you as the bank in the family, what about if you need to borrow money? Well, if I need to borrow money, I will go to my family members in the most professional way possible and I would be the one saying this is what I need the money for, I’d like to document this and write this down, this is when you can be expected to receive the payment. If I don’t pay you back, I would be here before the money is due to renegotiate these terms, so they get a sense that you are very serious, very credible and you wanna make sure that this goes really, really well.
    It’s also good for your own self-esteem. You know, hey, we get terms here, we get interest payments, I am gonna pay you back.
16. What basic idea does Melody Hopson start with in her talk?
17. What can help a lender get rid of future resentment and problems?
18. What might be a solution when people don’t want to loan family money?
19. What shall the borrower do if he or she can’t pay back on time?