Interesting SaaS business, for paper trailing personal loans between people who know each other:https://credi.com
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“Why would you want this for an informal loan?” Reduces risk to both parties in the same way contracts always do, by making sure they both understand what they’re agreeing to. Helps with a lot of the cases that otherwise require math / renegotiation (“Hey can I pay 20% early?”)
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Also when one of the parties to the loan is a business they’ll often want Maximum Papertrail for e.g. record keeping / tax purposes.
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e.g. If you have a cash flow crunch and borrow $25k from the Bank of Best Friend for your LLC, if that is legitimately for use of your business, any interest you pay is deductible. Because this looks awfully similar to tax evasion you want a very thorough papertrail on it.
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Incidentally: I have had good years and other-than-good-years in business and life generally, and if there was a message I could throw back into a bottle, it is a) businesses taking on debt is normal and not to be ashamed of and b) even trivial level of docs has reduced stress.
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One person who borrowed money from me accidentally overpaid by 20% and would have been unaware of that had I not been a pack rat on bank statements, and I’d far prefer he have the 20% than I do. All the ones with an amortization schedule and spreadsheet from day 1 = better.
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“How does that happen?” N year transaction, financially other-than-sophisticated counterparty who had a lot going on, me not professionalizing early for social reasons (“basically a gift”) not understanding that that decision was not in counterparty’s interest in all cases.
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End of conversation
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