Keep to a Schedule

I also recommend starting the repayment period as soon as possible. Don't settle for a lump-sum promise down the line. That puts too much pressure on you to be patient, and on your friend or relative to come up with a big chunk of cash all at once.

Instead, set up a monthly or quarterly repayment schedule and spread it out over an agreed-upon number of months or years. In fact, the smartest move is to have the payments deposited directly from their bank account into yours.

That reduces the chances of anyone getting sloppy or lazy -- and increases the chances that your personal relationship won't be undone by your financial relationship.