Question: I made a personal loan to a friend of $3000 to help save their business. In the loan agreement, it stated that the money (plus interest) was to be repaid in six months. The due date has passed by eleven months, and I have not received one cent towards repayment. How much time do I have before I loss my right to sue for the money?
Answer: It sounds like you had a written promissory note. If the loan was made under a written agreement, you must sue within 4 years of the date that your friend breached the agreement. Your friend breached the agreement when the loan became due.
If the loan was a verbal agreement, then you have two years from the due date to file a lawsuit.
For $3000, you should sue in small claims court rather than hire an attorney.
About the Author: Carl H. Starrett II has been a licensed attorney since 1993 and is a member in good standing with the California State Bar and the San Diego County Bar Association. Mr. Starrett practices in the areas of bankruptcy, business litigation, construction, corporate planning and debt collection.
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