Check These Before You Lend Your Money to Someone

May 24, 2022

Hi guys, good evening. I am not feeling well tonight, I have a headache but here I am trying to grind. Well, I guess this headache won't stop me from achieving my goals.

Are you allowing someone to lend money from you? Or if not,are you the person who borrows money from others?

If you are the one whom other people borrows money from, what are the qualities that you consider before you let your money be borrowed by others?

Lending your money to other people is not that easy thing to do even if you have money.

Before you let your money be borrowed, check the 5C's in Credit.

Have you heard / encountered this 5 C's of Credit?, Well, if you are a business ad student, for sure you will tackle this topic.

Ps: I will not be able to discuss all but let me just explain the 2 or 3 of the 5C's, namely capacity, character, collateral, conditon and capital.

1. Capacity

Before you lend your money to someone, make sure that your lendee has the capabibility to pay what he / she borrowed. Look if that person has a source of income. Make some little investigation if that person has a habit of paying your money on the right time. Or know if that person has a lot of debts to anyone.

1. Character

Always see to it if the person possess a good review when it comes on paying debts. Make also investigations if that person knows how to handle money well. If that person is "magastos" think twice or thrice before letting him / her lend your money.

See to it also if what is really the purpose on why he / she is borrowing money. If he / she told you that it is for emergency, there might be a high possibility that you will let them but if his / her purpose is on buying things that are not necessary, then that's red flag.

If his / her purpose on borrowing is for him / her to repay her debts to someone before, then there is a great possibility that what he / she is going to pay you is a money that is again borrored by her on someone.

1. Collateral

If the money that is going to be borrowed is a huge amount of money then you should first set is the collateral.

A collateral is very important beside from having your lendee appoint a guarantor because if the money is not being paid, the lender will somehow use the collateral as a payment of the debt.

• ps: I will just explain to you the three c's, I can no longer explain the rest.

Why did I come up with this topic?

Story time:

I have a friend in where I am working now who once borrow money from me, at first I was hesitant, I do not know why but I just do not feel to borrow money from me. But then, after some moments of thinking, I let her borrow my money. She is the one who set the date on when she will be paying her debt. I just agreed. When the maturity of her borrowed money has already reach, sadly! She told me that she may not be able to pay her debts since she's running away from cash and she's a eldest in them. So she was also the one who set the date agaim but them she did not kept her words. "Walang isang salita"

It was about months when finally she paid her debt and the moment she handled me the money, I promiesd myself for not letting her borrow again monet from her.

Months passed, she them told me if I have an extrau money and if it is okay if she'll borrow again . Of course as what I have promised myself, I did not lend her money - that's her punishment for not having a word of honor.

I didnot let her borrow again not all because of that, I have a lots of reason if I did not let her borrow from me.

First one, she has a lot of loan like mpany loan, sss loan, PAG-IBIG loan, not only that, she also has a debt on our other workmates. One of them was someone who I told the story about her first debt to me, let's just call her "Ms. A." At first Ms. A told me, she's not that sure if she will let her money be borrowed by that person but suddenly she let her and now Ms. A is regretting that she let her borrow money from her because she keeps on re-scheduling if when will she pay and keeps on disappearing on the date that she scheduled.

So guys, before you lend your money to someone, make sure that the person is a good payer because during this time, mahirap maningil ng utang, minsan kung sino pa ang nangutang un pa ang galit.