by Brandi Savitt – March 9, 2011
Lending Money To Employees
Our friend Hannah came to us recently with a dilemma. It all started with her lending money to an employee 3 years ago…
At the time, Hannah was living on the North side of Chicago, and she had a fabulous housekeeper she adored. Rose was meticulous about cleaning her house – and she was a genuine pleasure to be around. The two women struck up a friendship and their conversations soon turned from what brand of disinfectant to use to deeper personal issues.
The Friendly Loan
One afternoon Hannah came home to find Rose visibly upset. Rose confided in her that she had some mounting bills she needed to pay and – hesitantly – asked Hannah if there was any way she could borrow some money to cover her expenses – $500 to be exact. Without hesitation, Hannah agreed to loan her the money. Rose was an amazing person – and employee – and Hannah wanted to help in any way she could. Rose was extremely grateful and told Hannah she would pay the money back as soon as she could and didn’t expect it to be more than a couple of months.
The Big Move
A couple months went by and something Hannah considered to be miraculous happened – it had nothing to do with getting paid back – but her longtime boyfriend had finally proposed! Hannah had been holding out on moving in with Jim until they were engaged, and now, ring on finger, was ready to move into his condo on the South side of Chicago.
Rose was so excited for Hannah – having had so many conversations with her about Jim, she was delighted he had finally gotten his head on straight and proposed to her! The only bummer of the whole engagement? With Hannah moving clear across town, it would not be possible for Rose travel all that way to clean her and Jim’s home. Tearfully, the two ladies expressed their appreciation for one another and promised to keep in touch…
In all the excitement of moving and wedding planning, Hannah hadn’t given much thought about the $500 she had loaned to Rose. But as time went on and her wedding expenses began to tally up, the thought of the unpaid loan started to really nag at her…
Hannah went over the conversation she and Rose had had a million times in her mind. Rose had said she would pay it back when she could…and though she had said she thought it would just be a couple months, no specific date had been set. And since Rose no longer cleaned Hannah’s home, she had not seen her since the big move. Sure, they were Facebook friends, but it obviously wasn’t the same as interacting in person on a weekly basis.
Cut to Three Years & Counting
It’s recently come up on three years since Hannah lent Rose the $500 – and Hannah has not heard a peep from Rose regarding the loan. At this point, so much time has gone by that Hannah doesn’t know what to do…
Jim thinks Hannah should just call Rose and be straightforward – and ask for the money back! But Hannah’s gut is just the opposite. Though it bothers her, she feels bad even asking Rose about the money. Rationally, Hannah knows she shouldn’t feel bad asking for the money back, but on an emotional level – she just can’t deal.
Hannah’s friends are split on this one. Some of them feel it was Hannah’s own fault that she agreed to lend the money with such open-ended repayment terms. Others feel that three years was more than enough time for Rose to repay the loan. And still others argue that even if Rose couldn’t repay the loan ‘in a couple months’, enough time had gone by that Rose certainly should have at least called Hannah to touch base on the subject and keep her updated. But the bottom line – NONE of Hannah’s friends think that SHE should feel bad!
Communication Is Key
As in business, the key to any successful deal is communication, setting clear expectations and keeping your word! But – as easy as it might be for Hannah to blame Rose, Hannah was one half of the deal herself and mistakes were made on her end too. As the loaner, she should have laid out more specific repayment terms – or at least communication terms – at the outset of the loan. At the very least, she owes it to herself to call Rose and ask for an update on the situation. As awkward as it might feel to her to broach the subject, chances are both Hannah and Rose will feel much better having a heart to heart discussion – even on this awkward of a topic!| Print