Legal Question in Credit and Debt Law in Michigan

verbal agreements-lending money

I wanted to know if a verbal agreement will hold up for paying back a loan from a friend to open a business, even if the recipient of the loan refuses to put the agreement in writing?


Asked on 9/07/06, 10:41 pm

1 Answer from Attorneys
Rochelle Guznack Law Offices of Rochelle E. Guznack, PLLC

Re: verbal agreements-lending money

Verbal agreements are enforceable so long as they do not fall within the Statute of Frauds. I do not believe a loan for a business falls within the Statute of Frauds, and if you have a paper trail for the loan funds, starting with a check or bank withdrawal, you may have enough evidence to sue the person you loaned the money to (if you are the lender). I have to wonder though, why anyone would loan money to someone who refuses to put the agreement in writing. Is there some other consideration for the loan?

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Answered on 9/08/06, 8:31 am


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