You lent the money. They stopped answering.

NY CPLR § 213(2) · GEN. OBLIG. LAW § 17-101

A personal loan is a contract, even without a signature.

Under New York law, a loan is a contract like any other: you handed over money, the other person agreed to repay it, and they have not. Nothing in that sentence requires a promissory note, a notary, or a lawyer. An oral agreement, a text exchange, or a Venmo memo that says “loan” can all create a binding obligation to repay. The legal theory is breach of contract, and if that somehow fails, New York courts will usually still order repayment under the older principle that a person who receives money that in fairness belongs to someone else must give it back.

The practical problem is never whether an unwritten loan can be enforced. It is whether you can prove three things: that money changed hands, that it was a loan rather than a gift, and what the repayment terms were. Everything on this page is about building that proof and then using it.

Loan or gift? That is the fight you should expect.

When a borrower finally responds, the answer is rarely “I don't owe you.” It is “that was a gift,” or “you said don't worry about it,” or “I thought we were even after I helped you move.” You should assume that argument is coming and prepare for it now.

Courts look at what the two of you said and did at the time. Helpful facts include: the borrower asked for the money and described it as a loan; you discussed repayment, even loosely (“I'll pay you back when my tax refund comes”); the borrower made any partial payment; the amount is larger than the kind of money you would normally give away; and, most of all, anything in writing that uses the words loan, borrow, owe, or pay back. The person claiming a gift generally has to show that you intended to give the money away for nothing. A text that says “thanks, I'll get this back to you by March” makes that nearly impossible.

Family loans raise their own version of this problem, because relatives are more likely to have given money freely in the past. We cover that separately in lending money to a family member.

The evidence you already have.

Most lenders think they have nothing because there is no signed document. Look again. The record of a modern personal loan is usually scattered across four places:

• Payment records. Venmo, Zelle, Cash App, PayPal, bank transfers, and ATM withdrawals all leave a dated trail showing money left your account and landed in theirs. Memo lines (“rent loan,” “for the car, pay me back”) are gold. See using Venmo and Zelle records as proof.
• Messages. Texts, iMessages, WhatsApp, DMs, and emails where the money was requested, promised, acknowledged, or apologized for. “I know I owe you, things are tight” is an admission.
• Repayment history. Any partial payment, no matter how small, is evidence the borrower understood it was a loan.
• Witnesses. Anyone who heard the conversation or was told about the loan by the borrower.

Export and save all of it now, before a phone gets replaced or an account gets closed. If the loan was purely spoken, read enforcing an oral loan agreement in New York for how terms get proven without a writing.

A worked example.

Say you lent a friend $4,000 in January 2024 by Zelle, with a text that said “I'll pay you back by the summer.” Summer came and went. In October they sent $500 through Venmo captioned “part of what I owe you,” then nothing. By early 2026 they are telling mutual friends the money was a gift.

Here is how that case looks to us. The Zelle record proves $4,000 moved. The text proves it was a loan with a rough due date. The $500 payment, with its memo, is an admission that a debt existed and that $3,500 remains. The gift story, first told two years after the fact and after a partial repayment, is weak. The six-year clock started no later than the end of summer 2024, and the partial payment in October may well have restarted it. A demand letter laying out exactly that sequence, with the exhibits attached, is the kind of letter that gets answered. If it is not, the claim fits comfortably in small claims, and the borrower will be explaining to a judge why “part of what I owe you” meant something else.

How long you have: six years, usually.

New York gives you six years to sue for breach of contract, under CPLR § 213(2). For a loan with a due date, the clock starts when the payment was missed. For a loan with no stated due date, the analysis is more technical, and you should not assume the clock has not started just because you never set a deadline. If the borrower made a partial payment or sent a signed written acknowledgment of the debt, the period can restart; New York's General Obligations Law § 17-101 covers written acknowledgments. The details matter enough that we gave them their own page: the statute of limitations on a personal loan in New York.

Six years sounds generous. It is not. Evidence goes stale, borrowers move, and the “gift” story gets more convincing with every year you did not ask for the money. Act while the texts are fresh.

What a demand letter does here.

A demand letter from an attorney changes the conversation in three specific ways. First, it replaces “my friend is nagging me” with a formal, dated notice that a New York law firm has reviewed the loan, has the evidence, and has stated a deadline. Second, it puts the borrower's own words in front of them: the text where they asked for the money, the Venmo memo, the promise to repay by a certain date. People who have been ignoring you for months often pay within days once they see that record laid out by someone who can file a lawsuit. Third, it creates a paper trail. If the borrower responds with “it was a gift,” that response is now in writing, and any inconsistency with their earlier messages is preserved.

Our personal loan letters state the amount, the date and method of each transfer, the repayment terms as best the evidence shows them, the borrower's acknowledgments, and a firm deadline. They typically also offer a path: a lump sum by a date, or a short written payment plan. Borrowers who genuinely cannot pay in full often will sign a schedule when a lawyer proposes one, which converts a murky oral loan into a signed, enforceable document. Learn how the process works on our flat-fee demand letters page.

If the letter is ignored: small claims and beyond.

A demand letter is not a lawsuit, and some borrowers will call the bluff. New York's small claims courts exist for precisely this size of dispute and do not require a lawyer. In New York City, small claims handles cases up to $10,000. City courts outside the five boroughs generally go up to $5,000, and town and village courts up to $3,000. For larger loans, you file in the regular part of civil court or in Supreme Court, where the rules are more formal and an attorney becomes important.

The realistic comparison between a letter and a filing is on demand letter vs. small claims in New York, and the filing process itself is walked through in our New York small claims court guide. A judgment also earns interest: New York's statutory rate on contract claims is nine percent per year, which adds up quickly on a loan that has been sitting unpaid.

When to let it go.

We send a lot of these letters, and we also tell people not to send them. Here is when a letter is not the right tool:

• The borrower is judgment-proof. If the person has no job, no bank account, no property, and no prospects, even a court judgment may produce nothing. A letter can still prompt a payment plan from someone who wants to do right by you, but you should go in with clear eyes.
• The amount is small relative to the effort. A flat-fee letter makes sense for a loan in the hundreds or thousands. For $75, a direct conversation is the only proportionate move.
• You have no evidence at all. Cash, no messages, no witnesses, and a borrower who will deny everything. A letter can still work, because many borrowers will not lie to a lawyer in writing, but you should know the lawsuit behind it is weak.
• The loan is more than six years past due with no partial payment or written acknowledgment since. The debt may still be morally owed, but legally it is likely time-barred.

Related situations we handle.

Personal loans overlap with a handful of other disputes between people who know each other. If yours is one of these, start with the dedicated page:

• Oral loan agreements in New York: no paperwork, no problem, but here is what you must prove.
• Venmo, Zelle, and Cash App records as proof of a loan: how to export and use them.
• You lent money to a family member: the gift presumption and how to ask without blowing up the relationship.
• Statute of limitations on a personal loan: six years, when it starts, and what restarts it.
• A roommate skipped out on rent or utilities: your rights against them, separate from the landlord's rights against you.
• An ex won't return your belongings: demand and refusal, conversion, and getting property back.
• Engagement ring return in New York: the statute that settles it regardless of who called off the wedding.
• An uninsured driver hit your car: recovering repair costs from the driver personally.

Each of these ends with the same move: a specific, documented, attorney-signed demand with a deadline. Our flat-fee demand letter service exists so that people owed a few hundred or a few thousand dollars have a proportionate way to get a lawyer involved.