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You the jury March 2009 - Would you lend money to a friend?

In these financially stormy times, it's a big decision - help a friend or help yourself by hanging on to your money? Interviews by Elizabeth Openshaw

No

Simon Warr, 50, from Ipswich, Suffolk, teaches during the week and is a sports reporter at weekends. He lent £2,000 to a friend five years ago, which he has never got back.

Juliet* was the mother of one of my pupils and over time we became very good friends. I'd known her for a couple of years when she came to me one day in November 2004 in tears. All of her problems came out, about her husband leaving her, how much her house was costing and how she was worried about her children. Juliet hinted she needed money. I felt sorry for her and wanted to help so I asked how much she needed and she said £2,000 would be enough. When Juliet became pushy untilI actually wrote a cheque, I realised how desperate the situation was for her, but it didn't arouse my suspicions.

I drew up a written agreement, which we both signed. We arranged for Juliet to pay me back monthly in instalments of £500, starting from the next April.

Juliet was grateful and we remained good friends, but in April the money didn't go into my account. I asked her about it and she said, "Yes, I must put it in, I'll do it at the weekend." It never materialised. Excuse after excuse followed and then she stopped taking my calls. I realised I'd been duped and was both surprised and upset she could treat me like that. As time went on,I started feeling angry. I called Juliet from a friend's phone and she picked up. Fuming, I demanded my money back but I knew by the end of the call the only way I stood a chance of getting it back was via the judicial system.

In 2006, I took out a civil case against her to get my money back. She was found guilty in her absence of failing to pay back a loan, having signed a written agreement to do so. She was ordered by the court to pay back the £2,000, plus interest, but she couldn't be found.

I hired a solicitor who traced her to a flat in Glasgow but by the time they got there, she'd disappeared. Then in November last year, I found out she'd declared herself bankrupt so I doubt I'll ever get my money back.

Money is a driving force like nothing else; it's very powerful and can change people for the worse. I believe Juliet was a decent woman who got herself into trouble and couldn't face up to it. The money meant more to her than our friendship and that saddens me. My advice is don't lend money, it breaks up friendships - I learnt the hard way.

Yes

Karen Green, 41, lent £1,000 to her best friend. Karen lives in Southend-on-Sea, Essex, with her husband Dave, 49, and their nine-year-old daughter.

Mandy and I have been best friends since we were 17. At the beginning of last year, Mandy confided in me that her son, Daniel, hadn't been paying the rent on his flat. He was £4,000 in arrears because he'd been going out a lot and spending money on other things. The council was going to repossess it if he didn't pay the money. Mandy said,
"I need you to do me a favour." I wasn't that shocked when she asked me to lend her £1,000 to get Daniel out of trouble. He already had the other £3,000 from another friend. Mandy was such a good friend, I said yes. I didn't really have to think about it, I knew she'd pay me back as we've been best friends for years and she wouldn't want to jeopardise our friendship. Plus, I knew she'd do the same for me if it were the other way round. We've always done favours for each other.

I did wonder, however, if it was a good idea for her to bail Daniel out so easily, as he might think he could run up debts then turn to his mum for help. I mentioned this to Mandy and we both spoke to him to make sure he understood this was just a one-off.

A few days later, in August last year, I drew £1,000 from my credit card and gave it to Mandy. She was very grateful. We agreed she could pay me back in instalments of £300 a month, starting the following month. I said if there was any interest on the credit card, she'd have to pay that too and she did. Mandy was due to pay me the last £200in December but because of ChristmasI said it could wait until January. However, Mandy said she'd rather clear the loan so I didn't have to worry about it. Daniel is paying his mum back but it's their business how they sort it out.

I lent the money to Mandy because she's my best friend. She's always been on time with payments and has never missed one. To me, £1,000 doesn't seem a lot to lend Mandy but it would be if I lent it to someone I wasn't so close to. It hasn't affected our friendship at all and we speak every day. I think it all depends on who you're lending the money to. If it's not to a good friend I'd urge people to lay down rules beforehand about how they want to be repaid. I'm glad I lent the money because it helped out a good friend and kept a roof over her son's head.

Would you lend money to a friend? (CLOSED)

Yes

No

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