If I ever loaned my family money, I'd make them sign a secured, transferable note and then sell it off as quickly as possible. I'd rather extend a monetary gif

If I ever loaned my family money, I'd make them sign a secured, transferable note and then sell it off as quickly as possible. I'd rather extend a monetary gift without any expectation of repayment. Any money-related issue is bound to sour relations with your family sooner or later. Business partners that fall out can go their separate ways, but when your sister-in-law cheats her siblings out of their shares of the estate--because she opened the account for her Mom, and it was a joint account, just in case something happened to her--that brews some resentment. Loans make you involved in the borrower's business, and when things so bad, you need to be able to exercise all your options. Your lazy brother-in-law probably isn't going to prioritize making the loan payment to you over buying a new snowblower, or whatever other toy. Your sleazy brother-in-law might just default, claim your loan was actually a gift, and all but dare you to sue him. So it isn't just that there is a taboo against lending, but there is an insufficiently strong tradition of honoring personal commitments and sacrificing of one's self for the sake of the family.