Singletary: Should I let a friend with debt, no place to live move in?

During a recent online discussion, a reader wanted advice on whether she should allow a friend to move in with her.

The background: “I am 58 and I have lived alone for 30 years. I am financially secure and could retire today with no problems. My friend is recently divorced and in a terrible financial mess. She lost her house, has no job, and her husband is not paying the support he is supposed to pay. She has student loan debt of about $150,000 that, according to her, is in an income-based repayment plan. She was living with her parents, but they are moving into a nursing home. They have to sell the home, so now she is homeless.”

The plea: “She called me sobbing that she has nowhere to go,” the reader wore. “She begged me to take her in.”

The dilemma: The reader really wants to help her struggling friend but she’s fretting about how best to do so. “I would like to sit down with her and get some timelines for her getting on her feet.” The friend is living on the other side of the country while she’s helping to get her parents’ house cleaned out and ready for sale, so that buys her a little bit of time. “I need to get the conversation started before she packs her car and drives 3,000 miles,” the reader added. “I want to stay friends with her and be of some support, but I don’t want to be her total and only support.”

Without knowing the full details from the anonymous post, here are my suggestions for this reader and, for that matter, for anyone taking in someone with limited or no financial means.

Exercise due diligence. Get a full accounting of the person’s financial situation — any income, expenses, debts and, most important, spending habits. Ask to see pay stubs, bank records, credit reports — everything. Do this before they move in. (If privacy is a concern, the person can certainly black out account numbers, etc.).

In this reader’s case, find out the status of the student loans. What is she doing to enforce the support agreement with the ex-husband? What’s her plan for finding employment in the new location? You need a clear understanding of how bad things are to calculate how long the person may need to stay.

Find out the landlord rules in your state. Even the best of friends can become enemies when the living situation goes sour. What will it take to get her out should it come to that?

I suggest you have the friend sign a month-to-month rental agreement giving you the right to terminate the living situation fairly quickly if things get bad or overwhelmingly expensive for you. You need an exit strategy before she enters your home.

Figure out your financial breaking point. How long can you afford to cover the person before it negatively impacts your finances? Don’t underestimate the cost of your assistance because it won’t just be higher utility or food bills. You could easily get sucked into paying for other things such as a visit back across the country to see her parents.

Don’t make a decision based just on your emotions. People in need often don’t explore all of their options. Why is she a financial mess? That’s important to explore — if you can separate the emotion of feeling that you can’t let her be homeless — because perhaps she needs to fall hard before she makes some needed changes. Your help may actually hurt that process.

Here’s what my husband and I have learned in opening our home to people. No matter the circumstances or need, you’ve got to think things through. You should care for others, but sometimes your help may best be given from a distance.

Michelle Singletary welcomes comments and column ideas. In care of The Washington Post, 1150 15th St. N.W., Washington, D.C. 20071; singletarym@washpost.com