If you want to borrow money for a purchase and you can go to a neighbor who is willing to lend you money for the purchase you have in mind, this can be more beneficial than borrowing money from a lender. Often you do not have to pay interest on your borrowed amount.
Private money borrowing is not entirely without additional issues
However, private money borrowing is not entirely without additional issues. Practice shows that borrowing private money from your neighbor is often accompanied by no additional costs, but borrowing money from someone in your area is a matter of trust.
To finance a small or large expense with borrowed money from a friend or family requires clear agreements. Unlike borrowing money from your bank or an intermediary, your neighbor will not seize your private property if you cannot repay the borrowed amount within the pre-agreed period, but you can cause major conflicts and in some cases even result in a lasting conflict.
Borrow private money wisely?
Whether borrowing private money is wise will of course depend on yourself and your neighbor. If it concerns a small amount, borrowing private money can be more beneficial than borrowing money from your bank or intermediary, but with large releases this method of borrowing money is hardly advisable.
However, you can have this officially recorded in the form of a contract in which both parties agree with the pre-agreed loan requirements.
There are enough situations in which one can come to an agreement
It depends entirely on yourself and your neighbor whether you decide together to come to an agreement. There are enough situations in which one can come to an agreement that is successfully concluded, but at the same time there are also enough situations in which one gets into conflict for good. You will have to consider for yourself whether you can borrow money in good faith in which you can repay it in a disciplined manner.