Does this sound like a reasonable deal to make my brother?

Question

He is having money problems and wants to pay off his car. I'll pay off the $11,500 he owes, if he agrees to pay me back at 4% interest whenever he can in the future. I'll write something up for him to sign. 4% is what I get from a CD or high-yield savings account, so I think that's fair.

Oliverlogan263 · Accepted Answer

Yo, that sounds like a pretty reasonable deal to make with your brother, bro. Helping him out with that $11,500 car loan is a big deal, and the 4% interest rate you're proposing is definitely fair.

The 4% is basically the same as what you'd be earning if you just stuck that money in a CD or high-yield savings account, so you're not really profiting off him or anything. You're just trying to make sure the money is working for you a little bit while you're letting him use it.

And having him sign something formal about paying it back whenever he can is smart too. That way there's no confusion or miscommunication about the terms. Plus, it protects you in case anything ever goes sideways down the line.

The main thing is, you're trying to help your brother out in a tough spot, but you also want to make sure you're not getting the short end of the stick. The 4% interest and the written agreement seem like a pretty reasonable compromise.

As long as your brother is cool with those terms, I say go for it, bro. It's a solid way for you to lend him a hand without getting totally taken advantage of. Just make sure he understands the importance of holding up his end of the deal too.

Overall, it sounds like a win-win situation. You get a little return on the money, and your brother gets the help he needs to pay off that car. Definitely a reasonable arrangement in my book.

ohsheeT · Accepted Answer

Family or friends it's hard to loan money to

Just because it's something happens they feel like they can skip or they don't have to pay you back that moment because of whatever happened

So if you don't have the money to lose then don't do it

Or you can do it but you can make it really tough on them

Because no matter what there's always going to be a problem it doesn't matter there's always going to be a problem

So you have to work that into your contract

And it has to be in very fine detail in your contract

How would a bank do it

You can say you have to make me whatever he says that he can make in a payment every month let him pick that amount so it's clear he's one picking the amount that he's going to pay back every month

And if you don't receive it on due date it goes up $5 per day

When he picks the amount that he can pay you every month lower it by 20 bucks that way you're being fair to him you're making it easier on him at the same time if he doesn't pay on that day he owes you five bucks per day

I always say no to people who ask if they should loan their brother or friend money but

I do it all the time and it sucks I make it as hard as possible nowadays for my family or friends to borrow money

RandomUser1000 · Answer

It's hard to take interest from family.

But it's not completely unreasonable either.
(assuming it's something like you say, what you could get from a high-yeild savings account or something like that. Not trying to make max interest/profit from your brother).

RavVid · Answer

On the list of debtors, you'll be the last to be paid. 'Whenever' means you aren't going to be paid back. You will be better off making it a free gift because you are not seeing the money again.

Staximus · Answer

Don't do it, if you mail him out he will never learn to be financially responsible

Does this sound like a reasonable deal to make my brother?

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Is my brother asking for too much?

Does this sound like a reasonable deal to make my brother?

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Is my brother asking for too much?

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