Last week I made my first loan payment back to my parents. They loaned me $20,000 to help with the down payment on my condo a year ago. This is why I hate borrowing money from family and/or friends...
So, I was sitting in my parents kitchen yesterday and I asked my mom if she had given the check to my step dad to take to the bank yet. (She tends to forget stuff like that.) He asks what the check is for and I tell him the first payment on the loan. Now, when we set up the loan I was told I could pay them back starting one year after I borrowed it and I could either make annual payments or monthly payments, whichever was easier for me. I thought I would go with annual payments, one less bill to worry about monthly. The terms of the loan were a straight 5% of the total, my understanding was making the total $21,000. Hence, my first payment was $2100. He asked why I wrote it for that much and I explained that it was 1/10th of what I owed and I would pay that same amount annually. He then went into this long winded explanation of APR's and amortization schedules, all of which I understand, so I tuned him out for the next 20 minutes. When he was done, I explained that I understood all of that, but it was my understanding that the interest was again, a straight 5% of the total, but if I was wrong, please, let's get this figured out now so I know exactly what I owe at any time. Oh no! He has this way of trying to make you feel dumb when he is talking to you and says, it's fine, we'll do it your way, even though that wasn't his understanding of the loan terms. UGH!! My poor mom is sitting there very uncomfortably when he looks at her and says, what do you think? She says she is fine with either way, and let's just keep it the way I understood it to be. Then he says, well, it probably won't come out that much different anyway. UGH! Well, now you can bet they are going to get their money back much faster than over the next 10 years! I want this paid back to them ASAP!!! So, it will now be my mission to be able to write them a check every few months for the $2100 and have this monkey off my back sooner rather than later!
And that my friends is why I don't like borrowing money from friends or family!
And by the way, I wanted to say to my step dad, that it isn't his money anyway, it's money my mom got from life insurance when my dad passed away, so what the hell is he so worried about?? But I refrained.......for now! :)