Lending money to a family member might seem like the right thing to do when your relative needs financial help, but this transaction could end up causing problems later on. Family loans can be hard to collect, in some cases, and they can cause family divisions if the collection of the money turns into a problem. Here are three things you should know about family loans and collecting the money that is owed to you.
If you and your spouse are maintaining separate households and each have a separate mailing address, you may assume that you are legally separated. But the truth is, legal separation can only be issued by the court. This quasi-married state serves to outline the rights and responsibilities of married couples who are living apart, but who have not yet divorced. In the case of couples with children, it outlines custody and child support issues until a divorce is final.