How to get a personal loan with a friend

Check out tips on how to borrow money without causing discomfort. Borrowing money from a friend is often easier, safer, and less bureaucratic than applying for personal credit from the bank. But borrowing can be annoying and annoying if done the wrong way. So we have prepared these six steps for you to succeed in this mission.

1 – Choose the right person to apply for a loan

money loan

Separate relationships that give you openness to talk about money, financial investments, and of course letting you know that you can afford to lend you the amount you requested. If this person already has financial investments in other types of investment such as savings or stocks, it is a point in favor.

2 – Submit the loan application as a financial investment

money loan

Repaying the loan with interest is the best way to make the application attractive. Otherwise, it’s like asking for a gift. The average bank interest rate on a personal loan is 7.05% per month. Other lines like overdraft or credit card revolving reach 15% per month.

However, if your friend invests in savings, CDI or other common investments, the average earnings are up to 1% per month. Compensating it with 2 or 4x average savings earnings is very attractive to those who invest and yet you would pay less than bank interest.

3 – Formalize the loan

money loan

Insist on formalizing the loan with the agreed amounts, interest, installments and payment methods. This will give more financial security to your friend. Coming up with an already formatted proposal with advantages to the lender is a great way to initiate a loan application. You can make the formalization with a contract containing all agreed data.

4 – Prioritize the payment of installments

money loan

Studies show that the main reason lenders refuse to lend money to a friend was the fear of having to charge them and that would end friendship or friction between relatives. It is therefore crucial that you repay this debt as if you were paying a bank. You may propose to pay a fine and interest if you are late. Showing this is critical to getting a yes.

5 – Tell me the reason for the loan

money loan

If you need money, it is for some specific reason. Showing specifications for this reason may be a way to validate your order. If you want to pay off expensive debts, such as overdraft or credit card, show that you want to exchange this debt for cheaper debt.

If the money is for a new business, show the planning and how well prepared you are to get this venture to work. In addition, people do not tend to lend money to consumer items, such as buying clothes, shoes, and other nonessential items.

6 – Prove You Have Financial Planning

money loan

Do not take out a loan if you do not know how you will repay or have not done any financial organization. You can show that you have bank credit limits like overdraft or credit card. Also, you prefer cheaper debt or are waiting to receive a bonus – 13th or some other amount that will help to equalize your debt. Then you can pay the installments without problems.

Remember that your friend is not a bank, he is unable to do a risk analysis of his profile on his own. Then bring the information you find relevant to it.

Bonus Financial Tip

Our platform is the simplest way to borrow money from a friend or relative and get a yes. Through Mutual, you submit your loan application, already containing the interest that fits in your pocket, the amount and value of the installments and the payment day. Your friend receives your loan application as an investment option. We showed him that his order could be more profitable than other investments and we also took all his concern out of charging because Mutual does all this.

If he accepts, the installment slips are generated by Mutual and you receive all the money in your account. You get less bureaucracy and increase your chances of getting your personal loan and earning your friend who gets all the interest on repayment, has no worries about debt collection and even formalizes and legalizes this loan so you don’t have a headache.