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12 Reasons You Should Never Borrow Money From Families And Friends

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Anytime you run out of cash, what is the first thing that crosses your mind? Is it to borrow from families and friends or take a quick bank loan? Anyway, this article is here to give you some reasons why you should never borrow money from families and friends.

The urge to borrow money from loved ones might be stronger than opting for a bank loan.

However, it has it own limitations.

You must be aware of the side effect of getting a loan from your loved ones so you can prepare yourself for it.

The tips am about sharing with you are real life cases from people who have gotten a taste of families and friends loan.

Therefore, let’s get started.

1. You Stake Your Reputation, Relationship And Integrity For Money:

What happens if you couldn’t pay back the loan.

This will tarnish your integrity and trust before them to ever lend money to you in the future.

Borrowing money from families and friends might be convenient but have you considered if something arises and you just couldn’t fulfill your part of the loan agreement.

It could kill your long time relationship in a few days of getting a loan from them.

Though, there are always no written document, but just know the consequences ahead.

Related Article: How To Get An International Student Loan In USA.

2. It Might Breed Conflict Between Other Family Members And Your Group Of Friends:

Families and friends loaning you money most likely expect no interest because they feel you were on a tight spot and needed help.

Hence, your morale to pay back might be low since you know a family member wouldn’t take legal actions immediately.

However, the entire peace of the family might be interrupted and friends might not invite you over for hang-outs because you owe them money.

For instance, in an occasion when other family members might organize a party, how do they make arrangements for sitting and refreshments for the both of you?

They’ll need to prepare your seats separately so the both of you don’t clash into a dispute right there because of your personal issues.

3. The Money Might Be Their Only Source Of Survival:

Does it occur to you that they might also need the money.

Your friends and families are not a loan agency neither are they a microfinance bank or any bank that loans money out in town.

The money might be their only source of living and borrowing it out might place them on need too.

However, sometimes they might give it out so it doesn’t look like they disappointed you by not giving you the loan.

4. You Might Be Trapped To Run Back For Money When You Run Out Of Cash:

There are chances if you get a loan from them, you might have to keep running to them.

It might grow into an habit because you pay zero interest.

Hence, bad money habits might set in over time.

This is because when you consider the loan application process of getting money from your bank, you might not consider getting a bank loan.

On the other hand, the ease of just dropping a text message or giving them a phone call and your loan arrives within some few minutes or hours might trap you to them.

Statistics shows that most people who borrow from families and friends get stuck to the act.

Also, remember this might make them see you as an inferior.

5. You Might Feel Relaxed To Pay Back Or Never Pay Back:

There are huge chances you’ll not pay back your loan when you borrow from loved ones.

Why? This is because your mental brain might not see it as a bad money habit.

Thought like this might start running through your head, “He is my brother, She is my sister, We’ve been friends for 5 years, We are families”.

This thoughts will reduce your potential to pay back and build money troubles and misunderstanding between you and them.

Please be aware that everybody reacts in different ways, so get ready to take any mess you get.

In most cases, zero repayment plans can make it difficult for you to pay back the money.

6. It Gives Birth To Injustice And Fake Loyalty:

If anything happens that warrants finding your lender in a wrong act, injustice and fake loyalty might set in.

For instance, it’ll be very difficult for you to go against your lender even when you fully know he/she is wrong.

It cuts your ability to stand up against injustice and truth thereby making you partial when an issue arises between your lender and other families and friends.

A borrower will have no option but to choose sides with his/her lender even if the borrower knows the lender is wrong.

In simple terms, a borrower is always subjected to the lender.

Also Read: Best Time To Get A Quick Loan Cash.

7. Borrowing Money From Them Might Bring In Pressure Issues:

You might be putting pressure on them which might set them completely uncomfortable.

Families and friends unlike a bank might feel obligated to give you the money even if it warrant taking extra steps to help out.

Similarly, in situations when they couldn’t meet up, you might end up making them feel guilty for not solving your problems.

In the real sense, you should learn to solve your money problems without involving them.

Never borrow money from families and friends to avoid pressure issues.

Therefore, always use the bank.

8. They Might Start Ignoring Your Calls And Messages Even When You’re Not Calling For Money:

When your demands become a pain in the ass. They’ll all start ignoring your calls and text messages even if you don’t want to ask for money.

This is simply because no body likes to be bothered.

Everyone has their own issue even if they might not always bother you with it.

Hence, the best way to avoid being ignored is to solve your issues independently.

You’ve to grow up and stop running around seeking for help.

9. You Owe Me A Favor Attitude Will Set In When You Borrow Money From Families And Friends:

There are chances the family member or friend may come to you in the future and ask a favor.

In this case, you’ll feel obligated, even if you’d rather not grant the favor.

Expect to get a “you-owe-me” attitude based on their past loan to you.

Therefore, you’ll end up doing their request even if it goes against your wish.

This is one of the most important reasons you should never borrow money from families and friends.

10. Awkward Communications Might Arise:

It’ll become awkward when your family members and friends start asking you to pay up your loan.

Late loan payments could also bring in awkward demands on you.

It might set in embarrassment and lead to exchange of abusive words.

Money issues are personal and private matters.

Hence, having your friends pay attention to your financial life may not go well with your mental well-being.

Also Read: Why Does The Rich Pay Lesser Taxes Than The Rich And Middle Class.

11. Such Money Carries No Formal Agreement Thereby Given Your Lender Greater Powers:

Loans between families and friends are completely emotional, hence it mostly involve zero paper works.

There is no business partnership agreement signed, hence putting both parties to depend on trust.

Their is no stated punishment in cases you don’t back.

Hence, be lucky you don’t take loan from a wicked family relative who might take harsh measure on you.

12. Legal Cases Might Set In:

If a friend had to stick his head out to loan you some millions and you just disappeared because you couldn’t pay back, get ready for war.

This is not new and has always been a major loan trouble between friends and family relatives.

As far as possible, avoid becoming an enemy to your lender after picking up your loan.

Similarly, you might both land in trouble when they don’t have money and you seek them to help you as a co-signer to get an external loan.

In such case, you might put them in trouble if you don’t pay back, thereby tarnishing their credit record.




Never borrow money from families and friends if you’ve bad credit attitude.

Hence, if you care about your relationship with them, walk straight to your bank and pick up a loan.

Your financial life should be your private affairs and bothering people with it will only set them off from you when you demands become too much.

Instead, save money for rainy days, set financial goals with smart goal setting plans and stick to it.

You too can become financially free if you avoid losing money to bad spending habits.

Share your contributions with me at the comment section.

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