How do you get someone to pay you back the money they borrowed?

Some of the most gut-wrenching complaints filed with are about money lent to family, friends, or neighbors. Others are written by people who kindly co-signed car loans, student loans, mortgages, even cell-phone plans – and were then left holding the bag.

First, try not to get into that situation. If you’re going to act like a bank…act like a bank. If you wouldn’t be willing to write off  the debt as a dead loss if necessary, then draw up a contract. Make sure the borrower fills in social security info, terms of repayment, means of payment, full legal name, etc. – and signs it in front of a witness. Your bank will often provide notary services free of charge.

If they default, however, there are not many realistic options beyond trying to drag the deadbeat into court. (That’s assuming you can even find them.) So it’s not surprising that people file claims about unpaid loans on PeopleClaim.

Sometimes claims are resolved very quickly, once notice is delivered. Some take longer. One complaint about a personal loan was recently resolved after nearly two years, when the posted claim finally caught up with the respondent.

More often, the debtor is willing to pay but can’t, or at least – not right away.

Then comes the inevitable question to our customer support: “They say they’re going to pay it back but they want me to close the claim first. What should I do?”

That’s the easy part.

1)   Memorialize the agreement. Write it all out in the “add information” section on your response page. e.g. “XYZ has agreed to pay me back $5,000 at $500 per month for 10 months. Each payment will be sent by (PayPal, Venmo, Zelle, check, wire, Western Union…whatever!) by the first of the month. If any payment is not received and XYZ hasn’t made arrangements for a later payment, the claim will be re-posted.”

2)   Then either close the claim – knowing you can reopen it if you have to – or extend the posting date. We’ve had posting dates extended for as long as a year while a large invoice was paid off, but there’s really no limit.  If you choose to extend the posting date, make sure that the debtor has responded on the claim so that their “rating” doesn’t continue to degrade, even though the claim isn’t public.

And you’re done. Easier than you thought, right?

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