Question: My sister and brother-in-law have announced that they are broke, and want to borrow money. They went bankrupt a few years ago, but have since blown two inheritances on high-risk investments. They also borrowed extensively from our parents and never repaid the loans. Although both are college educated, neither has had a regular job for years, and now they say they can't find work. We turned down their loan request, and now my brother-in-law is threatening to never let us see my sister and nephew again. What are your feelings about loaning money to relatives, particularly when they have a history of not repaying loans? --Elaine
When Brian Hetherington complained to his father two years ago about the weighty 9% rate he and his wife were paying on their home-equity line of credit, Jim, the senior Hetherington, had an idea. He could lend the couple the $100,000 to pay off the loan and charge them only 6%. It's been win-win ever since. "We haven't missed a payment," says Brian, 43. And his folks are still earning a return on their money.
If you're considering starting a business in 2009, you're probably wondering how the heck you'll finance it. Raising start-up capital has always been a challenge, but the downturn has made a hard process harder.
Dear FSB: Way back when, there were low-interest rate loans from the government for women and minorities in small business. They no longer exist, business advisors say. Why is this? I am an older woman in business and find it all but impossible to get a loan.
A woman wearing a T-shirt with the slogan "Go fund yourself" across her chest offers me a grilled shrimp hors d'oeuvre. Another woman, dressed as a "Georgette" (a female version of George Washington), hands out dollar bills with a blank face on the front. The scene? A launch party in Boston for Richard Branson's new company, Virgin Money USA. The message? Branson's new firm will change the face of money by replacing inflexible loans from big banks with a more personal, nimble approach to lending.