<prompt> Human: My friend is starting a side business and needs some extra cash for it and asked me for a personal loan. I currently have the amount he needs sitting around as cash in my chequing account not really doing anything and am willing to help him out my other money is invested already in other equity myself. He said he will pay the loan back with interest, 5, so slightly lower than the banks rate which is 5.6 which is a win for him. For me, I see it as a way to make a little more than if I had invested the money in something like GICs, but of course I am aware it is with much higher risk ie. if the business fails and backrupts. As a result, I want to make the loan to him himself, not to him and his startup account, so that if the business does fail, since he still has a stable full time job he will be able to pay me back. Obviously, I have never done a big personal loan before...what is the process I need to take to protect myself in this case ie. I dont want to just write a cheque to him and be like promise me verbally you will pay it back? Do I just need to write a promissory note? What are some other things that I want to watch out for, and mainly what sort of financial questions do I want to ask about his business before committing myself to it? I feel like a mini shark in shark tank haha!Thanks in advance!  <response>: Dont loan money to friends or family in amounts you arent willing to gift. 