Finance

I want to ask my friends and family to help me financially with my travel business for six months. How do I prepare a formal request?

min read
Opinions expressed by Entrepreneur contributors are their own.
Any time someone agrees to provide you with a loan, it should be documented in writing. This is especially so when it comes to family and friends. Otherwise, without something in writing, the loan may be perceived as a gift, in which case both you and your "lender" could miss out on some valuable tax advantages.

You want to be very clear about the amount you're requesting, when you intend to start paying the loan back and the interest rate you'll pay. You also need to be very clear about what happens if you default on the loan.

Speak to an attorney to make sure you have the right legal language in the document. It's not just the money that's at stake--it's your personal relationship, too.

More from Entrepreneur

Whether you are launching or growing a business, we have all the business tools you need to take your business to the next level, in one place.
Enroll Now

Are paying too much for business insurance? Do you have critical gaps in your coverage? Trust Entrepreneur to help you find out.
Get Your Quote Now

In as little as seven months, the Entrepreneur Authors program will turn your ideas and expertise into a professionally presented book.
Apply Now

Latest on Entrepreneur

My Queue

There are no Videos in your queue.

Click on the Add to next to any video to save to your queue.

There are no Articles in your queue.

Click on the Add to next to any article to save to your queue.

There are no Podcasts in your queue.

Click on the Add to next to any podcast episode to save to your queue.

You're not following any authors.

Click the Follow button on any author page to keep up with the latest content from your favorite authors.